Justia U.S. 5th Circuit Court of Appeals Opinion Summaries

Appellee attempted to use an “inversion table” located at an Anytime Fitness franchise. The equipment allegedly failed, and Appellee suffered neuromuscular injuries. Appellee filed a personal injury suit in Louisiana court against the franchise owner, Thornhill Brothers Fitness, LLC (“Thornhill”). An amended complaint named an additional defendant, franchisor Anytime Fitness, LLC (“Anytime”). Thornhill agreed to assign all rights it had “against Anytime Fitness LLC” to the Appellees, including any rights arising from “the indemnity agreement contained in the Franchise Agreement” between Thornhill and its franchise parent, Anytime. Anytime then protested in the bankruptcy court. The bankruptcy court vacated its prior order and allowed Anytime a hearing. But in July 2022, the bankruptcy court entered a new order ratifying the actions it took originally. Anytime appealed that July 2022 order and the district court affirmed.  At issue on appeal is whether 11 U.S.C. Section 365(f) or any other portion of Title 11, authorizes a bankruptcy court’s approval of a debtor’s partial assignment of an executory contract.   The Fifth Circuit wrote that it does not and reversed the bankruptcy court’s contrary order and remanded. The court explained that it does not construe any other provision of the Code to permit circumvention of the court’s interpretation of Section 365(f). It’s true that the Code contains various catch-all provisions. But those catch-alls do not create substantive powers not committed to the bankruptcy court by some other section. The court wrote that since the bankruptcy court order at issue here does not satisfy Section 365, it does not matter whether it satisfied Jackson Brewing. View "Anytime Fitness v. Thornhill Brothers" on Justia Law

Defendant State of Louisiana, ex rel. Jeff Landry (“the State”) sought to dissolve a consent decree that pertains to the method of selecting justices for the Louisiana Supreme Court. The State attempted to dissolve the consent judgment under the first and third clauses of Rule 60(b)(5) of the Federal Rules of Civil Procedure. The State contended that the judgment has been satisfied, released, or discharged because the State has substantially complied with the decree for more than thirty years and the decree was intended to terminate at a defined milestone. The State further contended that it is no longer equitable to enforce the consent judgment prospectively because of widespread malapportionment in Louisiana’s supreme court election districts. The district court denied the State’s motion to dissolve.   The Fifth Circuit affirmed. The court held that the district court did not abuse its discretion in denying the dissolution motion, as the State has failed to meet its evidentiary burdens under both the first and third clauses of Rule 60(b)(5). The court explained that the State did not meet the evidentiary burden associated with Rufo’s first prong, which requires a showing of changed factual or legal circumstances that warrant reexamination of a consent decree. The State only makes very general claims about malapportionment and asserts that “new policy concerns” have arisen which satisfy Rufo. But the State offers almost no evidentiary support for this argument. Further, the court wrote that the State’s argument that continued enforcement of the Consent Judgment is detrimental to the public interest is unavailing. View "Chisom v. State of Louisiana" on Justia Law

Plaintiff Armadillo Hotel Group, LLC (“Armadillo”) is a buyer and operator of modular and mobile structures throughout North America. According to Armadillo, Defendants Todd Harris and Jason McDaniel were hired in May 2019 to oversee Armadillo’s construction operations and its hotel, food, and beverage operations, respectively. McDaniel resigned in January 2021, Harris in July 2021. Harris and McDaniel asserted that they entered employment agreements with AHG Management as part of the joint venture, but AHG Management breached these agreements by failing to pay the agreed-upon salary, bonuses, and profit-sharing interests. They asserted claims of fraudulent inducement, negligent misrepresentation, tortious interference, and unjust enrichment. Harris, McDaniel, SDRS, and BMC moved to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. The district court granted the non-GML defendants’ motion to dismiss with prejudice.   The Fifth Circuit reversed. The court explained that it could not find sufficient information in the record to decide if Armadillo and AHG Management were in privity with each other. The fact that the same attorneys filed AHG Management’s amended state counterclaim and Armadillo’s federal complaint is insufficient to show privity. Accordingly, the court found that the district court did not have sufficient information or even assertions about the relationship of Armadillo and AHG Management to perform such an assessment. View "Armadillo Hotel v. Harris" on Justia Law

Before Plaintiffs’ cases were distributed to the district court, these cases were part of MDL 2179, the multi-district litigation proceeding before United States District Court Judge Carl J. Barbier in the Eastern District of Louisiana. Judge Barbier established what is known as the “B3 Bundle” within the overall litigation. The B3 Bundle included claims for personal injury and wrongful death due to exposure to oil and/or other chemicals used during the response to the disaster. 85 B3 cases were assigned to District Judge Barry Ashe. Before his confirmation, Judge Ashe he was a longtime partner at the Stone Pigman law firm. A little more than two weeks after Judge Ashe began granting summary judgments following the exclusion of Dr. Cook, Street’s counsel moved to disqualify Judge Ashe in the five cases in which he had excluded Dr. Cook and in other cases where Daubert and summary judgment motions were still pending. Plaintiffs argued that Judge Ashe should have disqualified himself and, in the alternative, that he should have extended the case-management deadlines.   The Fifth Circuit affirmed. If Judge Ashe erred when he failed to recuse in these cases, that error was harmless. Nonetheless, as the arguments on this appeal support, potential conflicts of interest must be taken seriously by every member of the judiciary. The litigants and the public need to be confident in the impartiality of those who will decide legal disputes. View "Lundy v. BP Expl & Prod" on Justia Law

N&W Marine Towing (N&W) filed in federal district court a verified complaint in limitation (the Limitation Action), pursuant to the Limitation of Liability Act of 1851 (Limitation Act) and Rule F of the Supplemental Rules for Certain Admiralty and Maritime Claims. The complaint filed in N&W’s Limitation Action alleged that on February 29, 2020, the M/V Nicholas, which is owned by N&W, was towing six barges up the Mississippi River when the wake of a cruise ship, the Majesty of the Seas, caused one of the Nicholas’s face wires to break. After dismissing N&W from the case, no claims remained in the State Court Petition because Wooley had settled his claims against the other defendants. Therefore, the district court severed Wooley’s State Court Petition from the Limitation Action and dismissed it. The district court retained jurisdiction over the Limitation Action but stayed and administratively closed it to allow Wooley to pursue any claims available to him against N&W in Louisiana state court pursuant to the saving to suitors clause. N&W and Wooley cross-appealed.   The Fifth Circuit affirmed. The court determines that a nondiverse defendant was improperly joined, the improperly joined defendant’s citizenship may not be considered for purposes of diversity jurisdiction, and that defendant must be dismissed without prejudice. After determining that N&W had been improperly joined, the district court correctly considered only the citizenship of the properly joined State Court Petition defendants. As they were diverse from Wooley, removal based on diversity jurisdiction was permitted. View "Wooley v. N&W Marine Towing" on Justia Law

These consolidated cases continue the Fifth Circuit’s saga of Deepwater Horizon. Plaintiffs argue the district court judge abused his discretion by failing to disqualify himself at their request. The Street Plaintiffs do not challenge Judge Ashe’s decision to exclude the expert’s testimony under Daubert, nor do they raise any argument on the merits as to why his granting of summary judgment to BP was erroneous. In the briefing before the Fifth Circuit, the two arguments raised were that Judge Ashe should have disqualified himself and, in the alternative, that he should have extended the case-management deadlines. The Street plaintiffs argued that Judge Ashe abused his discretion for not disqualifying himself under 28 U.S.C. Section 455(b)(2) because he was a partner at Stone Pigman when it represented Cameron in the Phase One liability trial.   The Fifth Circuit affirmed. The court explained that the Street Plaintiffs do not challenge the judge’s actual impartiality on appeal. Instead, they rely solely on the “matter in controversy” language found in Section 455(b)(2) and argue that recusal was mandatory. The court explained that even mandatory recusal under Section 455(b)(2) can be harmless. The court wrote that if Judge Ashe erred when he failed to recuse in these cases, that error was harmless. Nonetheless, as the arguments on this appeal support, potential conflicts of interest must be taken seriously by every member of the judiciary. The litigants and the public need to be confident in the impartiality of those who will decide legal disputes. View "Street v. BP Expl & Prod" on Justia Law

Defendant asserts that he is required by his religious faith to abstain from psychiatric medication. Defendant raised a religious objection to being involuntarily medicated without identifying a particular source of law. The district court denied the objection, concluding that: (1) the Government had a compelling interest in prosecuting Defendant’s crime, which was not outweighed by Defendant’s religious liberty interests; and (2) the Government satisfied the four Sell factors. Defendant appealed.   The Fifth Circuit vacated the district court’s order and remanded. The court explained that Defendant faces a pending civil-confinement hearing in North Carolina. Moreover, he asserts that his religious belief as a Jehovah’s Witness prevents him from taking medication. He further asserts that forcible medication would violate his “constitutionally protected liberty.” The Government does not dispute that Defendant’s religious faith can qualify as a “special factor” under Sell. See Red Br. at 13–15; cf. Ramirez v. Collier, 595 U.S. 411, 426 (2022). Defendant’s religious beliefs, combined with his lengthy detention and his potential civil confinement, thus lessen the Government’s interests under the first Sell factor. The court emphasized that it holds only that religious liberty can constitute a “special circumstance” under Sell and that Defendant properly raised a religious objection to forcible medication here. That well-taken special circumstance, combined with other factors identified above, necessitates the district court’s reevaluation of the Government’s efforts to forcibly medicate him. View "USA v. Harris" on Justia Law

Certain Underwriters at Lloyds, London (“Lloyds”) brought an intervenor complaint against Cox Operating LLC (“Cox”) seeking to recover maintenance and cure benefits Lloyds paid to an injured seaman. Cox filed a motion for summary judgment, arguing that Lloyds bears responsibility for the payments under a protection and indemnity (“P & I”) policy under which Cox is an assured. The district court agreed and granted the motion. Lloyds timely appealed.   The Fifth Circuit affirmed. The court explained that even if there were ambiguity as to the term “intended operations,” as included in the limitation on the waiver of subrogation, any such ambiguity is to be resolved “in favor of coverage.” Because the M/V SELECT 102 was engaged in its “intended operations” at the time of the seaman’s injury and the limitation on the waiver of subrogation does not apply, Lloyds waived its subrogation rights as to Cox. Thus, the court affirmed the he district court’s dismissal of Lloyds’s intervenor complaint. View "Certain Underwriters v. Cox Operating" on Justia Law

Plaintiffs are private shareholders of Fannie Mae and Freddie Mac—government-sponsored home mortgage companies. Defendants include the Federal Housing Finance Agency (“FHFA”), the Treasury, the Secretary of the Treasury and the Director of the FHFA in their official capacities. The district court concluded that Plaintiffs had not plausibly alleged that the removal restriction caused them harm and dismissed their claims. It also dismissed their claims—raised for the first time on remand—that the FHFA’s funding mechanism is inconsistent with the Appropriations Clause, concluding that the claims were outside the scope of the Collins remand order in violation of the mandate rule. Plaintiffs raise two issues on appeal. The first is whether the district court erred in dismissing their claims that the unconstitutional removal restriction caused them harm. The second is whether the court erred in dismissing their Appropriations Clause claims.   The Fifth Circuit rejected Plaintiffs’ contentions and affirmed the dismissal of the removal and Appropriations Clause claims. The court explained that the anti-injunction clause applies and prevents courts from taking “any action to restrain or affect the exercise of powers or functions of the [FHFA] as a conservator or a receiver.” Because Plaintiffs seek injunctive relief that would require the FHFA to take specific actions as conservator to restore Plaintiffs to the position they would have been in if not for the unconstitutional removal restriction, they asked the district court to “affect” the “function of the [FHFA] as a conservator[.]” So, Plaintiffs’ APA claims are barred. View "Collins v. Treasury" on Justia Law

Plaintiff, then an Assistant Athletic Director at Louisiana State University (“LSU”)— internally reported Head Football Coach Les Miles for sexually harassing students. LSU retained outside counsel—Taylor, Porter, Brooks & Phillips LLP (“Taylor Porter”)—to investigate the matter, culminating in a formal report dated May 15, 2013 (the “Taylor Porter Report”). Matters were privately settled, and Miles stayed on as head coach until 2016. Lewis alleges that Defendants, members of LSU’s Board of Supervisors (the “Board”), leadership, and athletics department, along with lawyers at Taylor Porter (“Taylor Porter Defendants” and, collectively, “Defendants”), engaged in a concerted effort to illegally conceal the Taylor Porter Report and Miles’s wrong-doings. Plaintiff also alleged workplace retaliation for having reported Miles. She brings both employment and civil RICO claims. The district court dismissed Plaintiff’s RICO-related allegations as time-barred and inadequately pleaded as to causation.   The Fifth Circuit affirmed. The court considered when Plaintiff was first made aware of her injuries. It matters not when she discovered Defendants’ “enterprise racketeering scheme”—she alleges that this happened in March 2021 with the release of the Husch Blackwell Report. Plaintiff’s allegations make clear that she was made aware of her injuries much earlier. She was subject to overt retaliation after “Miles was cleared of any wrongdoing” by the Taylor Porter Report in 2013. Plaintiff alleged numerous harmful workplace interactions from that point forward. Given that Plaintiff filed her original complaint on April 8, 2021, her claims for injuries that were discovered—or that should have been discovered—before April 8, 2017, are time-barred. View "Lewis v. Danos" on Justia Law