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

Plaintiff filed a petition for damages in the 19th Judicial District Court in East Baton Rouge Parish. Plaintiff totaled his car in an accident and alleged that GoAuto, his car insurance carrier, paid less in policy benefits than his policy and Louisiana law required. GoAuto filed its notice of removal, Plaintiff received permission from the Louisiana court to amend his complaint again and, as accepted on appeal, filed the amended complaint. This amendment changed the definition of the class from class “residents of Louisiana” to class “citizens of Louisiana.” After removal, the parties filed several competing motions disputing which complaint controlled and the sufficiency of GoAuto’s notice of removal.   The Fifth Circuit affirmed the district court’s order remanding the case to state court, finding that Defendant is a citizen of Louisiana and thus the suit lacks the minimal diversity necessary to vest a federal court with jurisdiction. The court declined Defendant’s request to disregard the Louisiana state court’s pre-removal procedural rulings applying Louisiana law and substituted its own Erie guesses at how a Louisiana court ought to rule on a motion to amend a pleading.   Further, in regards to Defendant’s argument that it is plausible that some class members are not citizens of Louisiana, the court held that none of these individuals, assuming they had relocated to Colorado, Texas, or Florida before the filing of the complaint, qualify as citizens of Louisiana. Finally, the court held that Defendant points to nothing in the text of the statute that would bar Plaintiff’s class definition. View "Turner v. GoAuto Insurance" on Justia Law

Plaintiff sued PetroTel Oman, LLC (“PetroTel”) and affiliated entities in Texas state court, alleging that they breached an oral contract to compensate him for helping them raise funds for an oil and gas project in Oman. The PetroTel entities removed the action to federal court, arguing that removal was proper under the federal officer removal statute because they “acted under” a federal agency by partnering with the United States International Development Finance Corporation  (“DFC”) to raise funds for the project. The district court remanded the action, rejecting both grounds for removal offered by the PetroTel entities.   The Fifth Circuit affirmed the district court’s finding rejecting Defendant’s grounds for removal to federal court. The court held that the federal officer removal statute nor the Grable doctrine provides a basis for federal subject-matter jurisdiction in Plaintiff’s breach of contract action against Defendant.   First, the court reasoned that PetroTel did not assist or help the DFC carry out a task that the DFC—or any federal superior—otherwise would have had to do itself. Accordingly, PetroTel did not act under the DFC, so it was not entitled to remove under Sec. 1442(a)(1).  Next, the court held that because Plaintiff’s state court petition does not satisfy the well-pleaded complaint rule, the district court correctly determined that Grable does not provide a basis for federal jurisdiction. View "Box v. PetroTel" on Justia Law

N&W filed a maritime limitation action in federal district court after Plaintiff was injured on a ship owned by N&W Marine Towing. The district court initially stayed Plaintiff from prosecuting claims against N&W in other forums, however, the court lifted its stay after Plaintiff made certain stipulations.The Fifth Circuit reasoned that under the Limitation of Liability Act, shipowners “may bring a civil action in a district court of the United States for limitation of liability.” The Limitation Act allows shipowners to limit their liability for an array of incidents, as long as the incident giving rise to liability occurred without the p knowledge of the owner.Here, after N&W filed its limitation action, three parties filed claims: Wooley, Turn Services, and RCC. However, RCC and N&W settled, and Turn Services assigned its claims to Plaintiff, leaving him as the only remaining claimant. The court found that Plaintiff’s stipulation both recognized the district court’s exclusive jurisdiction over the limitation proceeding and stated that Plaintiff would not seek to enforce a damage award greater than the value of the ship and its freight until the district court had adjudicated the limitation proceeding. Thus, the court found that the district court did not abuse its discretion by lifting the stay and allowing Plaintiff to pursue remedies in other forums. Further, the court found that N&W’s arguments regarding removal are not relevant to the issue of whether the district court abused its discretion by lifting the stay. View "Wooley v. N&W Marine Towing" on Justia Law

Vista Health Plan, Inc., a small health insurance company in Texas, was assessed risk-adjustment fees that exceeded its premium revenue, causing the company to cease operations. The company and its parent, Vista Service Corporation, (collectively, Vista) sued HHS, HHS Secretary, the Centers for Medicare and Medicaid Services (CMS), and CMS Administrator Seema Verma (collectively, the HHS Defendants), challenging the risk-adjustment program and two rules promulgated pursuant to the program.The Fifth Circuit explained that determining whether the district court’s “final judgment” was truly an appealable judgment is necessary to establish whether the court has jurisdiction. The court explained that it has recognized an exception to the general rule and determined it had jurisdiction “when the agency would be unable to later appeal the issue that is the subject of the remand order,” such as when “all that is left for remand is a ministerial accounting.”Here, though the district court denied summary judgment as to Vista’s procedural due process claim, the court then explicitly entered a “Final Judgment” stating “nothing remains to resolve ... the case is hereby CLOSED”— suggesting the court “end[ed] the litigation on the merits.” The court held that the district court, in denying summary judgment on Vista’s procedural due process claim and then remanding it for further proceedings, did not yet fully dispose of the case., Thus, there was no appealable final judgment, and the court lacks jurisdiction to reach the substance of Vista’s appeal. View "Vista Health Plan v. HHS" on Justia Law

Dynamic CRM Recruiting Solutions sued UMA Education in Harris County district court for alleged misappropriation of Dynamic’s software in breach of their licensing agreement (“the Agreement”). UMA removed the action to federal district court, which in turn remanded it to state court based on the parties’ contractual forum selection clause.The Fifth Circuit found that the forum state is Texas, and the Agreement provides that its interpretation shall be governed by Texas law. The court reasoned that contractual choice-of-law clauses are generally valid under Texas law unless they violate one of the limitations set forth in the Restatement (Second) of Conflict of Laws Sec. 187 (1971), and neither party here has argued that this clause is invalid on this ground.Further, since the Agreement provides that disputes arising thereunder must be “brought before the district courts of Harris County”, UMA has contractually waived its right to remove the suit. UMA also argued that the district court abused its discretion in allowing Dynamic to drop its claims for conversion, quantum meruit, lien foreclosure, and violations of the TTLA. The court found that it need not reach the jurisdictional point because the district court properly allowed Dynamic to amend its complaint. Thus, the court affirmed the district court’s ruling. View "Dynamic CRM v. UMA Education" on Justia Law

This case arises from a dispute regarding a joint financial venture between Noble Capital Fund Management, L.L.C. (“Noble”) and US Capital Global Investment Management, L.L.C. (“US Capital”). Noble created two separate funds, collectively the “Feeder Funds."Noble and the Feeder Funds initiated a JAMS arbitration against US Capital, alleging various claims including the breach of contractual and fiduciary duties. US Capital was unable to pay the arbitration fees, and the JAMS panel terminated the arbitration.On November 24, 2020, Noble and the Feeder Funds sued US Capital in Texas state court for various claims including fraud and fraudulent inducement. US Capital appeals the denial of its motion to compel arbitration and stay judicial proceedings and the denial of its motion to transfer.The court explained the Federal Arbitration Act requires that, where a suit is referable to arbitration, judicial proceedings be stayed until arbitration "has been had." Here, there is no arbitration to return this case to and parties may not avoid resolution of live claims by compelling a new arbitration proceeding after the first proceeding failed. Further, the court found no pendent jurisdiction over the denial of the motion to transfer. The court affirmed the district court’s ruling and dismissed the appeal of the district court’s denial of the motion to transfer. View "Noble Capital Fund v. US Capital Global" on Justia Law

Plaintiff was injured when a gun manufactured by the defendant accidentally discharged. Plaintiff and her family filed several claims in the district court. The district court dismissed all parties’ claims except the plaintiff’s defective-design claim under the Louisiana Product Liability Act. Plaintiff recovered $500,000 and the defendant appealed.On appeal, the Fifth Circuit reversed the district court’s finding that the Louisiana Product Liability Act (“LPLA”) permitted the plaintiff’s claim. Section 60(b) of the LPLA provides that no firearm manufacturer can be held liable for any shooting injury unless the injury was “proximately caused by the unreasonably dangerous construction or composition of the product.” The court held that this language unambiguously bars design-defect claims. The court also rejected the plaintiff’s argument that the natural reading of Section 60(b) leads to an absurd result. View "Seguin v. Remington Arms" on Justia Law

Walmart employees stopped the plaintiffs, a woman and her daughter, on suspicion of shoplifting. The plaintiffs sued Walmart in state court, alleging false imprisonment, among other claims. Walmart removed the case to federal court, and the district court dismissed some claims and entered summary judgment in favor of Walmart. Regarding the plaintiffs' Texas Deceptive Trade Practices & Consumer Protection Act claim, the court found they failed to identify any facts that would establish an unconscionable action. Next, plaintiffs assert that Walmart employees committed acts underlying their false imprisonment claims and that Walmart is vicariously liable. The court reasoned that the off-duty police officer is treated as an anon-duty police officer for vicarious liability purposes. As a result, Walmart cannot be vicariously liable for the off-duty officer’s actions. Plaintiffs further argue that Walmart did not establish that her detention was reasonable. The court found that plaintiff cannot state a prima facie case for assault, battery, or offensive contact. Finally, they do not provide any argument that they were harmed, let alone substantially prejudiced, by allowing Walmart to attach portions of depositions, an asset protection case record sheet, and body camera footage. The court found that the plaintiffs failed to demonstrate the necessary elements for their claims. View "Huynh v. Walmart" on Justia Law

Appellants (“Defense Distributed”) have challenged publication restraints imposed by the U.S. State Department, federal courts, and the State of New Jersey (“NJ”) after appellants published the internet computer-assisted design (“CAD”) files for a single-round plastic pistol. Although Defense Distributed is still prevented from publishing, the CAD files it published remain available on many other websites. At issue in this combined appeal and motion for mandamus relief stems from a district court’s (“DC”) order severing the case and transferring it to a federal court in NJ. The court found that the Defense Distributed satisfied the first two conditions for mandamus relief. Further, the NJ Attorney General did not carry its burden to demonstrate that transfer is more appropriate than the plaintiffs’ choice of forum.The court concluded that the DC’s order severing and transferring the claims against the NJAG to the District of New Jersey was a clear abuse of discretion, giving rise to an appropriate exercise of the court’s mandamus power. View "Defense Distributed v. Bruck" on Justia Law

Plaintiffs and the United States filed suit against the State of Texas, as well as state and local officials, seeking to enjoin enforcement of some or all of the new provisions in Senate Bill 1, which amended various provisions of the Texas Election Code pertaining to voter registration, voting by mail, poll watchers, and more.The Fifth Circuit reversed the district court's denial of the Committees' motion to intervene as defendants, concluding that the Committees have a right to intervene under Federal Rule of Civil Procedure 24(a)(2). The court determined that the Committees made a timely application to intervene by right; they claim interests relating to SB 1 which is the subject of this consolidated suit; their absence from the suit may practically impede their ability to protect their interests; and the existing parties might not adequately represent those interests. Accordingly, the court remanded to allow the Committees to intervene by right in this suit. View "La Union del Pueblo Entero v. Harris County Republican Party" on Justia Law