In 2003, as part of a comprehensive tort reform package, the Texas legislature again rewrote the law of supersedeas.1 Courts and attorneys alike have found the new law, and the new rules promulgated thereunder, to be less than models of clarity. Indeed, as with many of the laws passed in this era, the legislation creates some rather novel issues and leaves many questions unanswered. This article will address the rule changes and how the courts have dealt with them in the context of money judgments.2 In addition, the article will propose changes to the rule which should simplify the procedure for trial courts.

A. The basic elements and procedure

The methods for superseding a judgment are set forth in the Texas Rules of Appellate Procedure:

[A] judgment debtor may supersede the judgment by: (1) filing with the trial court clerk a written agreement with the judgment creditor for suspending enforcement of the judgment; (2) filing with the trial court clerk a good and sufficient bond; (3) making a deposit with the trial court clerk in lieu of a bond; or (4) providing alternate security ordered by the court.3

For a money judgment, the amount of the bond, deposit, or security must equal the sum of (1) the compensatory damages awarded; (2) interest for the estimated duration of the appeal; and (3) costs awarded in the judgment.4 The amount of the security may not, however, exceed the lesser of (1) 50 percent of the judgment debtor’s net worth, or (2) $25 million dollars.5

 A judgment debtor who provides security based on its net worth must file an affidavit stating its net worth and providing “complete, detailed information concerning the debtor’s assets and liabilities from which net worth can be ascertained.”6 Once filed, the affidavit is “prima facie evidence of the debtor’s net worth.”7

A judgment creditor may file a contest to the affidavit and may conduct reasonable discovery concerning the judgment debtor’s net worth.8 The trial court must hear the contest promptly after discovery is complete,9 and “issue an order that states the debtor’s net worth and states with particularity the factual basis for that determination.”10 The net worth finding is used to set the maximum amount of the bond. The judgment debtor may reduce the amount further only by establishing that posting the amount based on net worth is likely to cause the judgment debtor “substantial economic harm.”11 If the court finds that net worth is zero or negative, the bond is set at zero.12 If there is more than one judgment debtor, the trial court must analyze the evidence adduced on behalf of each one and set a separate bond amount for each one, even if liability is joint and several.13

 The creditor may also petition the trial court for injunctive relief if the debtor is transferring or dissipating assets to avoid satisfaction of the judgment. The trial court may not, however, make any order that interferes with the judgment debtor’s use or transfer of assets in the normal course of business.14

B. What is included in the amount to be superseded?

Unless reduced by the trial court, the bond amount must equal the sum of compensatory damages, interest for the duration of the appeal, and costs awarded in the judgment.15 The term “compensatory damages” is not defined in either the statute or the rules, but the Texas Civil Practice & Remedies Code defines it to be “economic and noneconomic damages.”16 The definition expressly excludes exemplary damages.17 It is therefore likely that it will also exclude damages which are similar to, or in the nature of, exemplary damages.18

The definition is silent, however, with respect to prejudgment interest and attorney fees. Not surprisingly then, there has been a question as to whether the supersedeas amount must include them. The likely answer is yes. Interest has traditionally been defined as “compensation for the use, forbearance or detention of money,”19 so it is compensatory by nature. No opinion, however, directly addressing the issue has yet been issued.

Attorney fees have frequently been awarded as “costs,”20 so it would appear proper to include them, too. In the only reported decision addressing the issue, the court did so.21 There, the contract between the parties provided that, in the event of suit, the prevailing party was entitled to recover attorney fees. Plaintiff suffered a take-nothing judgment, and the court awarded the defendant its attorney fees. That was the only award. Plaintiff argued the bond should be zero because attorney fees were not “compensatory damages.” Both the trial and appellate court disagreed. First, nothing in the statute expressly excluded attorney’s fees from the calculation. Second, the fees were either “costs” awarded in the judgment, or compensation provided for under the contract. In either event, the fees were properly included in the supersedeas amount.

C. Burden of proof

The judgment debtor has the burden of proof on net worth and substantial economic harm.22 If the debtor does not file a net worth affidavit, the supersedeas amount is determined by adding the compensatory damages, interest and court costs, subject only to the $25 million cap. If the debtor files a net worth affidavit, that affidavit is prima facie evidence of net worth.23 Presumably, then, once an affidavit is filed, the trial court clerk would simply use the net worth figure in the affidavit to calculate the supersedeas amount. Presumably also, in the event of a contest, the affidavit would retain its prima facie character until controverting evidence were introduced.

It all sounds relatively simple, but it is not. Neither “prima facie evidence” nor “net worth” is defined in the rules, and the little available case law does not fill the vacuum. Indeed, as the Texas Supreme Court has noted, albeit in construing a statute rather than one of its own rules, the phrase “prima face evidence” is “ambiguous at best:” “[I]t is sometimes used ‘as equivalent to the notion of a presumption,’ i.e., it entitles the proponent to an instructed verdict on the issue in the absence of evidence to the contrary. The term is also used to mean that the proponent has produced sufficient evidence to go to the trier of fact on the issue.”24

What the term means for the supersedeas rules is uncertain. In the absence of clearer language in the rules, trial courts are unlikely to accept minimalist or untrustworthy affidavits as presumptively true. On the other hand, if “prima facie evidence” means only that there is enough evidence to go to the trial judge who then has the option to dismiss it as incredible, the question arises as to whether the rules subserve the stated policy behind the statutory amendments, namely to provide more meaningful access to appeal. Compounding the problem is the rule’s requirement that, in a contest, the trial court must conduct a hearing after which the court must state a net worth figure and the reasons behind it. While that may not be difficult in cases in which the net worth evidence has been developed, it may be extraordinarily difficult or impossible in cases in which the evidence is either non-existent or entirely incredible.

Changes to the rules which may alleviate or eliminate this problem are being contemplated, but in the interim trial courts must still attempt to comply with the rules as written.25 Those rules do not allow the trial court simply to rule that the judgment debtor has not carried its burden of proof and, therefore, is not entitled to a reduction in the supersedeas amount. Rather, they require the determination and rationalization of a specific net worth number. Practically speaking, the only way to attempt to achieve that in many instances will be through the use of a presumption.

It is certainly likely that, insofar as the duties of the trial court clerk were concerned, the phrase “prima facie evidence” was intended to create a presumption. Rather than making any substantive determination of the merits of the affidavit, or the manner in which net worth was calculated, the clerk could simply presume the net worth figure in the affidavit to be correct and calculate the supersedeas amount accordingly. Such a presumption would facilitate the processing of supersedeas bonds and eliminate the necessity of the trial judge having to review every net worth affidavit. Given that the opposing party may contest the affidavit if it so chooses, there is no real risk of harm.

If, however, the language means presumption for the clerk, consistency requires that it also mean presumption for the trial court in a contest. Thus, upon the filing of a contest, the net worth figure presented in the affidavit is presumed true, the judgment debtor has satisfied its initial burden, and the burden of producing controverting evidence shifts to the judgment creditor. If the creditor does not produce controverting evidence, the presumption triumphs and net worth is what the affidavit says it is. If the creditor produces controverting evidence, the presumption disappears in the same way any other presumption would.26 The presumption itself is no longer considered evidence, but the facts upon which the presumption was based may be introduced as evidence and will support any reasonable inference that may be drawn from them.27  The court, which is required under the rules to state the net worth figure as well as the basis for that determination, considers the evidence, decides what it finds credible, and issues its net worth finding.

Interpreting “prima facie evidence” as creating a presumption provides significant assistance to trial courts in one particular aspect. While there may be cases in which the parties develop substantial evidence on net worth and the court has the means available to determine a specific figure, there will also be cases where there is either little or no evidence. Indeed, the net worth affidavit itself may be suspect or internally inconsistent. In those situations, the presumption provides the trial court a method by which it can state a net worth number as required by the rules. Using a presumption in that manner would be similar to the way in which affidavits of indigence are treated under appellate Rule 20.

An obvious drawback of using a presumption is that it shifts the burden of producing evidence to the judgment creditor who, in effect, must undertake discovery to prove what the rule explicitly requires the judgment debtor to prove. Although this may seem somewhat unfair, it is not illogical. The judgment creditor has an undeniable interest in discovering assets anyway. If, as is reasonable to assume, judgment creditors desire, and would pursue discovery of, the information anyway, it is not inappropriate that the burden of producing evidence should shift to the creditor.

Nonetheless, there will still be cases that present particular difficulty. Assume, for example, a debtor files a skeletal affidavit reflecting no assets and considerable debt resulting in a negative net worth. The creditor files a contest. At the hearing, the creditor elicits, on cross-examination, that the debtor has misstated its net worth. That controverting evidence destroys the presumption, and now the debtor must prove net worth by a preponderance of the evidence. Neither the debtor nor the creditor, however, introduces any more evidence at the hearing. How is the trial court to derive a net worth figure, let alone defend it? The answer is that, on that record, it cannot. There is no evidence of net worth. The only potential resolution is that the trial court itself is permitted to examine the witnesses to attempt to derive a net worth figure. Undoubtedly, this places an additional burden on the trial court, and it will not resolve all net worth contests, but it is, practically speaking, the only means by which the trial court can attempt to comply with the rules as presently worded.

One proposed change in the rule’s language would delete the requirement that the trial court determine a net worth figure in all cases.28 In its place, suggested revisions would permit the trial court to rule that the net worth affidavit was not sufficient or that the debtor had not met its burden of proof. 29 Presumably in those situations, the supersedeas amount would be the rule’s default figure. To insure that trial courts do not arbitrarily deny supersedeas bond reduction, and to facilitate appellate review, the trial court would have to detail the reasons why the proof was deficient.30

The revisions have not yet taken formal shape but they appear to be on the right track. As an alternative, however, the authors suggest the following. First, the rule should be changed to delete the ambiguous phrase “prima facie evidence” and replace it with a rebuttable presumption: “In the absence of a contest, the net worth stated in the affidavit is presumed true.” If the judgment creditor does not challenge the affidavit, there is no need for the court to become involved, even if the purported proof in the affidavit is, in some sense, defective. If, on the other hand, there is a contest, the presumption disappears and the debtor bears the burden of proof at the hearing by a preponderance of the evidence. If the debtor does not bear its burden, and the evidence is not sufficient to permit the trial court to determine net worth, the trial court would so state and articulate the factual basis for the ruling. The supersedeas amount would not be reduced.31

D. How is the judgment debtor’s net worth determined?

“Net worth” is not defined in the statute or rules, but it has been the subject of several opinions. The appellate courts for Dallas and both Houston districts have defined net worth as the difference between total assets and total liabilities determined under generally accepted accounting principles (GAAP).32 The Fourteenth Court, relying primarily on the definition applied to “net worth” by federal courts under federal statutes, expressed no uncertainty as to the matter: “While determining ‘net worth’ under GAAP may be quite complicated and may involve different considerations based on the circumstances of the judgment debtor and based on GAAP, the unambiguous meaning of this term is the difference between total assets and total liabilities determined in accordance with GAAP.”33 The court therefore rejected the judgment creditor’s argument that net worth could be measured by market capitalization.34 The court stated that the trial court may have discretion to determine the value of the debtor’s net worth but did not have discretion to alter the meaning of the term itself.35

Only about a month earlier, a different panel of the Houston First Court of Appeals had originally declined to adopt such a rigid definition. Relying on the legislative history of the new statute, the court, in its first opinion, stated “Thus we hold that, for supersedeas purposes, a company’s net worth should be determined after evaluating all of the relevant evidence and should not be restricted to the narrow definition of the excess of assets over liabilities. As both the Legislature and Supreme Court have recognized, a company’s book value net worth assets minus liabilities—can be manipulated, making it an unreliable means of determining a company’s true net worth.”36 On rehearing, however, the opinion was withdrawn, and a new en banc majority opinion was issued, reiterating that net worth is determined by current assets minus current liabilities in accordance with GAAP. 37

The Texas Supreme Court has not yet decided the issue, but it has issued one opinion which seems inconsistent with a strict GAAP-based approach. In In re Smith,38 the Court ruled that, in determining net worth, a trial court may consider evidence and make findings with respect to alter ego claims. If the court determines the evidence supports a finding of alter ego, the assets of that entity may be considered in determining net worth.39 Hence, even the term “asset” is not entirely clear.40

Whether the Supreme Court will adopt a GAAP-based approach or another approach affording the trial court greater discretion is not clear, but tying the definition of net worth to GAAP proffers no panacea. First, requiring proof of net worth in accordance with GAAP may, in many instances, render the process needlessly more expensive. There will be numerous cases in which neither party is familiar with GAAP and must, therefore, engage experts to put on their evidence.41 Second, even the experts do not always agree on the meaning and application of GAAP.42 Finally, GAAP itself permits discretion in certain areas of reporting. For example, under GAAP, a law suit is typically treated as a contingent liability, that is, an off-balance sheet item that must nonetheless be disclosed in the notes to the financial statement. A judgment, pending appeal, may also be treated as a contingent liability but could just as well be argued to be a current liability directly affecting net worth.43

Similarly, under GAAP, balance sheets value certain assets at book value - the original acquisition cost - regardless of market value. The simple subtraction of liabilities from assets can thus result in a negative net worth despite the presence of extremely valuable assets. In Enviropower, L.L.C. v. Bear, Stearns & Co.,44 for example, application of GAAP resulted in a net worth of negative $12 million because the primary assets of the company–federal air permits–were valued at book value. The market value of the permits, however, had appreciated considerably, and the company had located a buyer who was willing to pay $10 million to buy the business. Based upon the market value of the business, in large part attributable to the market value of the assets, the trial court determined the company’s net worth to be $8 million. The appellate court reversed. Determining net worth by valuing the company and its assets was not a proper methodology. Net worth must be calculated as current assets minus current liabilities in accordance with GAAP. 45

Depreciation is another familiar GAAP line item that can significantly affect the determination of net worth. An asset may still have market value although it has been fully depreciated. Hence, a trial court should have discretion to consider that market value despite its GAAP depreciation. Depreciation may also be manipulated. In LMC Complete Automotive, Inc. v. Burke,46 for example, a depreciation entry appeared for the first time on the company’s balance sheet just three weeks after the verdict. The entry was unexplained and had not appeared on prior balance sheets. The trial court ruled the entry was not made in the ordinary course of business but rather had been inserted to reduce the value of the assets. Although the court of appeals disagreed with the trial court in several respects, it agreed on the depreciation issue. The court of appeals eliminated the depreciation allowance and then determined net worth by deducting liabilities from assets. 

As to the types of evidence the judgment debtor may adduce, the most frequent is testimony from the judgment debtor itself as to the nature of its assets and liabilities.47 Although such testimony comes from an interested witness, it may establish a fact as a matter of law so long as the testimony could be readily contradicted if untrue, and is clear, direct, and positive, and there are no circumstances tending to discredit it or impeach it.48 Similarly, uncontradicted balance sheets may also establish net worth as a matter of law.49 Tax returns, although they may provide some information relevant to financial wherewithal, do not state net worth.50 Testimony from a bonding agency may also be useful not only to establish net worth but to show the prospect for being able to post a bond.51

E. When is the judgment debtor’s net worth determined?

Neither the statute nor the rule states precisely when the judgment debtor’s net worth is to be determined, but the rule, unlike the statute, uses the word “current” to modify net worth. As with the phrase “net worth” itself, it appears that the lack of a definition was to provide the trial courts flexibility. After all, in normal usage, “current” does not refer to a specific time. In addition, “current” is a relative term. One company’s “current” financial statement may be three months old yet another’s is only days old. Finally, “current” does not necessarily mean “as close as possible but prior to today.” “Current news,” for example, can refer to events that will take place in the future.

Only one reported decision has involved the issue to any degree. In Enviropower, L.L.C. v. Bear, Stearns & Co., Inc.,52 the judgment debtor argued that its “current” net worth was negative $12 million despite a pending sale which included the assumption of liabilities and payment of $10 million. According to the debtor, the future sale was irrelevant to a determination of “current” net worth. The trial court disagreed and determined the company’s net worth based in part upon the pending sale. The appellate court reversed, but its decision did not hinge on the definition of “current.” Rather, the court ruled that the trial court’s use of market value was not a proper method for determining net worth.53

Although the term “current” may provide some flexibility, it is still problematic. First, it does not resolve the issue of whether the amount of the judgment itself should be included in determining net worth. Second, tying the bond amount to the debtor’s present financial circumstances may, for some debtors, encourage manipulation of the balance sheet. One potential solution is to provide that net worth should be determined at a set time before the judgment. Florida has such a supersedeas statute.54 To avoid manipulation of the balance sheets, net worth is determined by applying generally accepted accounting principles to the defendant’s financial status as of December 31 of the year prior to the judgment.55

Adding a similar time provision to Rule 24.1 would clarify whether the judgment amount should be included in the net worth determination, and it would reduce the likelihood of manipulating the balance sheet. To complement this determination, the trial court would be given discretion to consider changes in financial status, whether positive or negative, between the benchmark time and the time of judgment. 

F. What is substantial economic harm?

Regardless of the net worth determination, a trial court must reduce the amount of the bond to an amount that will not cause the judgment debtor substantial economic harm, if, after notice to all parties and a hearing, the court finds the security required is likely to cause the judgment debtor substantial economic harm.56 Neither the rule nor the statute defines “substantial economic harm.”

The courts have not yet defined it either, but two have noted it is less than “irreparable harm,” the standard under the prior statute, and that it requires the court to focus on the judgment debtor’s practical ability to supersede the judgment.57 “[T]he court should be less concerned with what price the company might fetch in the marketplace if sold today and more concerned with the company’s available resources and its ability to use them to post security.”58 The court should therefore examine the judgment debtor’s overall financial situation, including its cash position, sources of funds, ability to borrow, and availability of unencumbered assets to sell or pledge, and determine the likely economic impact posting the supersedeas bond would have on the judgment debtor.59 If it would likely trigger liquidation or bankruptcy, substantial economic harm has probably been established.60 Short of that, the trial court has considerable discretion in deciding the issue.

G. Conclusion

The 2003 changes to supersedeas practice were premised on a substantial change in focus. Under the old procedure, the priority was to protect the judgment creditor; under the new procedure, the objective is to permit a judgment debtor a meaningful opportunity for appeal. The new rules have undoubtedly succeeded in accomplishing that objective in many respects, but it has not been without its cost. They have created headaches for trial courts and fostered a fair amount of peripheral litigation. A few changes could resolve these problems.

Patrick Dyer practices business litigation and appeals in the Houston area as a solo practitioner.  He is board certified in civil trial law.

Jacalyn Scott graduated magna cum laude from the University of Houston College of Law in 1978.  She is board certified in civil trial and civil appellate law.  She practices business litigation and appellate law in Houston with Wilshire & Scott P.C., and  previously practiced with her co-author, Patrick Dyer.  

Endnotes

1. See Tex. Civ. Prac. & Rem. Code Ann.  §52.006 (Vernon Supp. 2006).  House Bill 4 wrought a number of significant changes in Texas law.  See Scott Rothenberg, “A User Friendly Guide to House Bill 4,” Texas Bar Journal (September 2003).   2. For a comprehensive and detailed analysis and history of Texas supersedeas practice, see Elaine A. Carlson, Reshuffling the Deck: Enforcing and Superseding Civil Judgments on Appeal After House Bill 4, 46 S.TEX.L.REV. 1035 (2005).   3.Tex. R. App. P. 24.1(a).   4. See Tex. Civ. Prac. & Rem. Code Ann. §52.006 (Vernon Supp. 2006); Tex. R. App. P. 24.2(a)(1).   5. See Tex. Civ. Prac. & Rem. Code Ann. §52.006(b); Tex. R. App. P. 24.2(a)(1).   6.Tex. R. App. P. 24.2(c)(1).   7.Id.   8.Tex. R. App. P. 24.2(c)(2).   9.Tex. R. App. P. 24.(c)(3).   10.In re Smith, 192 S.W.3d 564, 568 (Tex. 2006) (orig. proceeding) (quoting Rule 24.2(c)(3)); LMC Complete Automotive, Inc. v. Burke, 229 S.W.3d 469 (Tex. App. - Houston [1st Dist.] 2007), pet. denied).   11.Tex. R. App. P. 24.2(b)   12.G.M. Houser, Inc. v. Rodgers, 204 S.W.3d 836, 845 (Tex. App.–Dallas 2006, no pet.)   13.Ramco Oil & Gas, Ltd. v. Anglo Dutch (Tenge) L.L.C., 171 S.W.3d 905, 911 (Tex. App. - Houston [14th Dist.] 2005, no pet.).   14.Tex. R. App. P. 24.2(d).   15. See Tex. Civ. Prac. & Rem. Code Ann.  §52.006(a) (Vernon Supp. 2006); Tex. R. App. P.  24.2(a)(1). The bond amount is still subject to the $25 million cap.   16. Tex. Civ. Prac. & Rem. Code Ann. §41.001 (8) (Vernon Supp. 2006)   17.Id.   18. At least one court has already so held in the context of usury penalties.   In Umbrella Bank, FSB v. Jamison, 341 B.R. 835, 840-42 (W.D. Tex 2006), the trial court held that usury penalties are penal and more in the nature of exemplary rather than compensatory damages. Accordingly, the court ruled, the penalty amount should not be included in the supersedeas amount.   19.First USA Management, Inc. v. Esmond, 960 S.W.2d 625, 627 (Tex. 1997).   20.Williams v. Compressor Engineering Corp., 704 S.W.2d 469, 474 (Tex. App. –Houston [14th Dist.] 1986, writ ref’d n.r.e.); Valley Ranch, L.P. v. City of Irving, No. 05-03-01416-CV, 2004 Tex. App. Lexis 5658, *6 (Tex. App.–Dallas June 25, 2004)(mem.op.)(“[A]ttorney fees are more appropriately viewed as an ancillary amount (such as costs or sanctions)”); City of San Benito v. Ebarb, 88 S.W.3d 711, 723 n.15 (Tex. App.–Corpus Christi 2002, pet.denied)(“[A]ttorney’s fees are in the nature of costs, not damages.”).   21.Clearview Properties, L.P. v. Property Texas SC One Corp., 228 S.W.3d 262 (Tex. App. - Houston [14th Dist.] 2007).   In Umbrella Bank, FSB v. Jamison, 341 B.R. 835, 838 n. 7 (W.D. Tex 2006), the attorney fee award was also included in the supersedeas amount, but there was no discussion as to whether they constituted compensatory damages or costs.  The judgment debtor assumed, and the court agreed, that attorney fees were to be included in the amount to be posted.   22.Tex. R. App. P.  24.3(c)(1) and (c)(2); Tex. Civ.  Prac. & Rem. Code Ann. §52.006(c);Ramco Oil & Gas, Ltd. v. Anglo Dutch (Tenge) L.L.C., 171 S.W.3d 905, 910 (Tex. App. - Houston [14th Dist.] 2005, no pet.).   23.Tex. R. App. P. 24.2(c)(1).   24.Coward v. Gateway Nat’l Bank, 525 S.W.2d 857, 859 (Tex. 1975)(citations omitted)(construing a former version of Article 2226 which provided that the State Bar Minimum Fee Schedule shall be “prima facie evidence” of reasonable attorney fees).  As another court has put it, “Sometimes it means evidence raising a presumption; that is, proof establishing the existence of the fact at issue as a matter of law if no opposing evidence is offered.  In other contexts it means proof that merely entitles the proponent to go to the jury on the existence of the fact at issue if no opposing proof is offered.”  Valley Forge Life Ins. Co. v. Republic Nat’l Life Ins. Co., 579 S.W.2d 271, 276 (Tex. Civ. App.–Dallas1979, writ ref’d n.r.e.)(construing Article 5541, which provided that the armed forces death certificate was prima facie evidence of the date and place of death).   25. See, e.g., February 16, 2007 and June 8, 2007 transcripts of the meetings of the Texas Supreme Court Advisory Committee, available online at the website of the Texas Supreme Court.    26.General Motors Corp. v. Saenz, 873 S.W.2d 353, 359 (Tex. 1993).   27.Id.   28. Texas Supreme Court Advisory Committee, February 16, 2007 Transcript at 15518-15538.   29.Id.   30.Id.   31. To accomplish this, the language could be changed to the following: “The trial court must hear a judgment creditor’s contest promptly after any discovery has been completed.  The judgment debtor has the burden of proving net worth.  If, at the hearing, the judgment debtor introduces sufficient evidence from which the trial court can determine net worth, the court shall issue an order that states the debtor’s net worth.  If sufficient evidence is not introduced at the hearing, the trial court shall so state.  In either event, the trial court shall state with particularity the factual basis for its decision.”   32. LMC Complete Automotive, Inc. v. Burke, 229 S.W.3d 469 (Tex. App. - Houston [1st Dist.] 2007, pet. denied); G.M. Houser, Inc. v. Rodgers, 204 S.W.3d 836, 840 (Tex. App. - Dallas 2006, no pet.); Ramco Oil & Gas, Ltd. v. Anglo Dutch (Tenge) L.L.C., 171 S.W.3d 905, 915 (Tex. App. - Houston [14th Dist.] 2005, no pet.).   33. Ramco Oil & Gas, Ltd. v. Anglo Dutch (Tenge) L.L.C., 171 S.W.3d 905, 915 (Tex. App. - Houston [14th Dist.] 2005, no pet.)   34.Id. at 914.  Market capitalization is the price per share multiplied by the number of outstanding shares.   35.Id.   36.Enviropower, L.L.C. v. Bear, Stearns & Co., No. 01-04-01111-CV, 2007 Tex.App.Lexis 3692 at *22-23 (Tex. App.--Houston [1st Dist.] May 10, 2007).   37.Enviropower, L.L.C. v. Bear, Stearns & Co., 265 S.W.3d 1, 6 (Tex. App.--Houston [1st Dist.]  2007, pet. denied)(en banc).   38.In re Smith, 192 S.W.3d 564, 568-69 (Tex. 2006)(orig.proceeding)   39.Id.  The alter ego findings cannot, however, be used to enforce the judgment against a non-judgment debtor.  Id.    40. Fraudulent transfer theory has also been used to reconstruct the asset side of the balance sheet.  See G.M. Houser, Inc. v. Rodgers, 204 S.W.3d 836, 841 (Tex. App.–Dallas 2006, no pet.).  The judgment creditor succeeded at the trial court level but the appellate court reversed on no evidence grounds.   41. One might even query whether expert testimony is required.  In a case unrelated to supersedeas issues, the court of appeals stated in Browning-Ferris Industries, Inc. v. Meszaros, 845 S.W.2d 926, 944 (Tex. App. - Corpus Christi 1992), rev’d on other grounds, 881 S.W.2d 288 (Tex. 1994) that net worth is a technical and specialized matter with respect to which expert testimony may be admitted to assist the jury in determining the proper amount of punitive damages.   42. See, e.g., Sears Roebuck & Co. v. Dallas Central Appraisal District, 53 S.W.3d 382, 387-88 (Tex. App.–Dallas 2000, pet.denied)(dispute over GAAP’s treatment of inventory valuation); Brown v. GSC Realty Corp., No. 05-92-02188-CV, 1994 Tex.App.Lexis 3300, at *30 (Tex. App.–Dallas Oct. 28, 1994, writ granted)(GAAP treatment of interest on intercompany loans).   43. Under GAAP, the manner in which the liability is reported or disclosed as contingent or actual usually depends on whether the reporter believes that the likelihood  the liability will have to be paid is probable, reasonably possible or remote.  See Statement of Financial Accounting Standards No. 5.   44.Enviropower, L.L.C. v. Bear, Stearns & Co., 265 S.W.3d 1 (Tex. App.--Houston [1st Dist.] May 10, 2007, pet. denied).  After determining that the company would sustain substantial economic harm if it had to post the full $4 million as a supersedeas bond, the trial court reduced the bond amount to $200,000.   45.Id. at 5-6.   46.LMC Complete Automotive, Inc. v. Burke, 229 S.W.3d 469 (Tex. App.--Houston [1st Dist.] 2006, pet. denied).   47. See, e.g., Ramco Oil & Gas, Ltd. v. Anglo Dutch (Tenge) L.L.C., 171 S.W.3d 905, 911 (Tex. App. - Houston [14th Dist.] 2005, no pet.).   48.Id. at 911-12.   49.LMC Complete Automotive., Inc. v. Burke, 229 S.W.3d 469, 485 (Tex. App. - Houston [1st Dist.] 2007), pet. denied).   50.Id. at 485-86.   51.  Id. at 485.   52.Enviropower, L.L.C. v. Bear, Stearns & Co., 265 S.W.3d 1 (Tex. App.--Houston [1st Dist.] 2007, pet. denied).   53. Id. at 5-6.   54.  Fla. Stat. § 768.733. In an appeal of an award of punitive damages in a class action, the judgment debtor may supersede the amount of the punitive damage award by posting the lower of the amount of the award or ten percent of the net worth of the defendant.   55.Id.   56. See Tex. Civ. Prac. & Rem. Code Ann. §52.006(c); Tex. R. App. P. 24.2(b).  The new statute also lessened the degree of proof.  Under the former law the debtor had to show that harm “will” occur; now, the debtor need show only that harm is “likely.”   57.Ramco Oil & Gas, Ltd. v. Anglo Dutch (Tenge) L.L.C., 171 S.W.3d 905, 917 (Tex. App. - Houston [14th Dist.] 2005, no pet.); LMC Complete Automotive., Inc. v. Burke, 229 S.W.3d 469 (Tex. App. - Houston [1st Dist.] 2007, pet. denied).   58.Ramco Oil & Gas, 171 S.W.3d at 917.   59.Id.   60.See  Id.