Pax­ton opinion de­nies se­man­tic change that would of­fer le­gal cover.

Austin American-Statesman - - FRONT PAGE - By Bob Sech­ler bsech­ler@states­man.com Buf­fett

Bil­lion­aire War­ren Buf­fett has en­coun­tered an­other road­block in his ef­fort to ma­neu­ver around a Texas law that is jeop­ar­diz­ing his con­tin­ued own­er­ship of more than two dozen au­to­mo­bile deal­er­ships in the state, and he might be run­ning short of op­tions.

Texas At­tor­ney General Ken Pax­ton put up the lat­est ob­sta­cle this week, is­su­ing an opinion in which he de­clined to pro­vide le­gal cover for a se­man­ti­cal fix that po­ten­tially would have en­abled Buf­fett to com­ply with the state law with­out chang­ing his own­er­ship struc­ture.

“It is some­what un­fath­omable that there will not be some kind of so­lu­tion here,” said Cliff Banks, an au­to­mo­bile in­dus­try an­a­lyst based in Detroit. “I think peo­ple will be shocked if Texas can­not come to some sort of agree­ment or fig­ure this out.”

Buf­fett’s Berk­shire Hath­away con­glom­er­ate has run afoul of a Texas law that pro­hibits mo­tor ve­hi­cle man­u­fac­tur­ers from also own­ing deal­er­ships, even if the ve­hi­cles aren’t of the same type. Berk­shire Hath­away owns a deal­er­ship unit — Irv­ing-based Berk­shire Hath­away Au­to­mo­tive — and also owns For­est River Inc., an In­di­ana com­pany that makes RVs.

Pro­po­nents of the Texas reg­u­la­tions, in­clud­ing the po­lit­i­cally pow­er­ful Texas Au­to­mo­bile Deal­ers As­so­ci­a­tion, say the rules safe­guard con­sumers by pre­vent­ing au­tomak­ers from es­tab­lish­ing re­tail mo­nop­o­lies. Crit­ics of the law say it’s a pro­tec­tion­ist mea­sure de­signed to en­sure deal­er­ships con­tinue to op­er­ate as third-party mid­dle­men.

The law is the rea­son Tesla Inc. is pro­hib­ited from sell­ing the elec­tric cars that it makes di­rectly to

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