Texas Precious Metals v. State Comptroller
Lawsuit Advances Amid Scrutiny of Coin Program
Following a three-day injunction hearing that concluded on April 22, 2026, and closing argument briefs submitted May 12, 2026, the parties to a lawsuit filed by Texas Precious Metals, LLC, against Texas Acting Comptroller Kelly Hancock and the Texas Bullion Depository await the court’s ruling on Texas Precious Metals’ request for a preliminary injunction against the Comptroller’s commemorative coin and Redback note program. A ruling from Senior U.S. District Court Judge David Allen Ezra is expected soon.
Background
The Shiner-based precious metals dealer filed suit against the Acting Comptroller in February 2026, alleging that the state's commemorative coin program, administered through the Texas Bullion Depository in Leander, is not authorized by statute and amounts to unlawful government competition with private businesses. The lawsuit has since drawn national attention, with legal analysts and industry observers watching closely as the case tests the boundaries of state authority in the precious metals market.
Texas Precious Metals was the first company to publicly challenge the commemorative coin program, which Acting Comptroller Hancock unveiled in December 2025. The rollout included gold and silver coins emblazoned with the outline of Texas and a line of paper currency products marketed as "Modern Texas Redbacks," bills inlaid with 24-karat gold and issued in three denominations, bearing images of Texas icons, including a Longhorn, the state capitol dome, and the Alamo. The gold proof coin is priced at more than $6,500, with the exact price fluctuating based on the value of the precious metal it contains. The smallest Redback note sells for roughly $15.
In its lawsuit, Texas Precious Metals alleges that the program exceeds the agency's statutory authority and gives the state an inherent competitive advantage over private dealers, one it characterized as statutorily impermissible. The company's lawsuit further alleges that the state, acting through the comptroller's office, was effectively entering the retail precious metals market using taxpayer infrastructure and the imprimatur of official government authority, without being subject to the same regulatory and market constraints that govern private dealers.
The Legal Questions at Issue
The lawsuit raises several significant legal questions currently before the court:
Statutory Authority
The lawsuit questions whether the legislature's grant of authority to the Texas Comptroller and the Depository was broad enough to encompass a retail coin program of the type that has been implemented. At the April hearing, state attorneys characterized the products as promotional; Texas Precious Metals countered that the program is unprecedented, a government-sponsored bullion depository issuing official-looking precious-metal products that fit no established legal or commercial category.
False Advertising
The lawsuit alleges that consumers are being confused because the coin program falsely advertises the coins as currency minted under official State of Texas authority. The comptroller's office has stated the products are "not legal tender," though critics note that characterization has done little to resolve market confusion, particularly after Gov. Greg Abbott signed a law last summer recognizing gold and silver as legal tender in Texas.
Trademark Infringement
The lawsuit also alleges that coins and other products in the comptroller's program infringe upon Texas Precious Metals' trademarks and its registered mint mark, the silhouette of the state of Texas, with respect to the trading of precious metals.
Government Competition with Private Enterprise
Intertwined with the legal issues is the broader question of whether the state's direct participation in the retail coin market, leveraging official branding, government-backed credibility, and publicly funded infrastructure, constitutes unfair competition that harms private dealers operating under free-market conditions. "The state is leveraging its authority and reputation to enter into commerce in a way that private companies simply can't," CEO Tarek Saab told Texas Monthly.
Media Coverage and Growing Attention
The lawsuit has been widely covered since its filing. The following outlets have reported on the dispute:
Texas Precious Metals - original press release.
Texas Precious Metals sues Texas Comptroller over coin program
Austin American-Statesman
Texas gold law, coin lawsuit notes: what the case means for the state's bullion program
The Texan
Texas gold lawsuit challenges state's ability to issue commemorative coins
Austin American-Statesman
Texas coin program surges amid confusion and concerns from industry participants
Texas Monthly
The Austin American-Statesman covered the filing and subsequently reported on surging activity in the state coin program alongside mounting confusion and concerns from industry participants, noting that the program saw significant growth in coin sales even as questions about its legal footing remained unresolved.
The Texan characterized the dispute as a challenge to the state's authority to issue commemorative coins at all, framing the legal questions as potentially far-reaching for how Texas, and possibly other states, can use government-backed entities to compete in commodity markets.
Texas Monthly provided an in-depth examination of the dispute and the April injunction hearing, reporting that lawyers for the state argued the Redbacks and coins qualify as nothing more than "promotional" items designed to raise awareness of the depository.
"Five-thousand-dollars-a-pop coins don't qualify as swag."
— Tarek Saab, CEO, Texas Precious Metals, as reported by Texas Monthly
Texas Monthly further reported that a central question throughout the hearing was what exactly the products are, observing that the coins appear to occupy an undefined legal category, neither sovereign currency nor traditional bullion rounds, which in the precious metals industry are nonmonetary coins not issued by a government. Texas Precious Metals repeatedly portrayed the state's program as unprecedented: a government-sponsored bullion depository issuing official-looking precious-metal products that fit no established legal or commercial classification.
Current Status
Almost one month after Texas Precious Metals filed its suit, the State of Texas filed a second lawsuit in Wichita Falls federal court challenging the validity of Texas Precious Metals' trademarks. The judges presiding over the suits are currently considering motions filed by both sides to have the two suits consolidated.
As of the date of this press release, both cases are ongoing and remain pending in the U.S. District Courts for the Western District of Texas, Austin Division and Northern District of Texas, Wichita Falls Division, respectively. No final judgments have been issued. The parties remain active in litigation, and the cases are expected to continue developing in the months ahead. In the Austin suit, Judge Ezra is expected to rule soon on whether the state is enjoined from producing the Redbacks and coins while the litigation proceeds.
Texas Precious Metals has stated publicly that the company intends to see the litigation through to a resolution. The comptroller's office has defended the program as a lawful exercise of state authority consistent with the legislature's directives.
Texas Precious Metals has made clear it views this lawsuit as a matter of principle — one that goes beyond its own commercial interests to the broader question of whether state government should compete directly against the private businesses it is meant to serve. The company declined to provide detailed commentary on the specifics of pending legal proceedings, consistent with standard practice during active litigation.
Why This Matters Now
For the precious metals industry, the outcome of this case carries implications that extend well beyond Texas. The Texas Bullion Depository, established in 2015 and opened in 2018, was the first state-administered precious metals depository in the United States. Its coin program represents a significant expansion of that initiative into direct retail commerce, one that comes against a backdrop of surging gold prices that have more than doubled since late 2023 amid what analysts have described as a modern-day gold rush in precious metals markets.
If the courts determine that the state overstepped its authority, or that the program as structured imposes unfair competitive burdens on private dealers, the ruling could prompt legislatures in Texas and other states to re-examine the permissible scope of government-affiliated financial entities operating in commodity markets.
Conversely, a ruling upholding the program could validate an emerging model of state-sponsored precious metals commerce that several other states have observed with interest.
About Texas Precious Metals
Texas Precious Metals is one of the nation's largest online retailers of gold, silver, platinum, and palladium bullion. Founded in 2011 and headquartered in Shiner, Texas, the company also owns and operates Texas Precious Metals Depository that serves retail and institutional customers across the United States. Texas Precious Metals is an accredited affiliate member of the London Bullion Market Association (LMBA).
Texas Precious Metals is a party to active litigation referenced in this article. Nothing in this article constitutes a representation regarding the ultimate outcome of the pending lawsuits. For questions regarding the litigation, contact Texas Precious Metals directly.
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