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

In this consolidated appeal stemming from the bankruptcy of nineteen companies that were tenants-in-common of a student housing development called the Reserve, the Fifth Circuit reversed in part and affirmed in part the bankruptcy court's judgment. The court reversed the bankruptcy court's reduction of UTSA's share of net proceeds from 21.17% to 3.14%, based on serious procedural deficiencies, the lack of notice to UTSA regarding the imposition of a constructive trust, and the remedy's violation of the terms of the Code. The court held, however, that the bankruptcy court did not err in reducing Woodlark's proof of claims from $510,475,98 to $410,097.78. The court remanded for further proceedings. View "UTSA Apartments, LLC v. UTSA Apartments 8 LLC" on Justia Law

The proceeds of a homestead sold after the filing of a petition for Chapter 7 bankruptcy remain exempt from the debtor's estate if they are not reinvested within the time frame required to invoke the proceeds rule of Texas homestead law. In Hawk v. Engelhart, 871 F.3d 287 (5th Cir. 2017), the Fifth Circuit held that funds withdrawn from an exempted retirement account after the filing of a Chapter 7 bankruptcy do not lose their exempt status even if the money is not redeposited in a similar account within 60 days pursuant to Texas's proceeds rule. In this case, the court saw no reason why Hawk's analysis should not apply to Texas's homestead exemption. Therefore, the homestead here was exempt because it was owned at the commencement of debtor's bankruptcy. Accordingly, the court reversed the district court's judgment and reinstated the bankruptcy court's order dismissing the adversary proceeding. View "Lowe v. DeBerry" on Justia Law

FWP and its designees filed suit against Chesapeake and related entities to recover payment allegedly due under a provision of a Surface Use Agreement governing Chesapeake's use of FWP's land. The Fifth Circuit affirmed the judgment of the district court determining that the payment provision was a covenant that ran with the surface of the land and that FWP accordingly forfeited the benefit of this covenant when it sold that land. Because FWP consequently forfeited its right to payment under this paragraph when it sold the surface of the land at issue to Chesapeake, the court did not address the district court's alternative holding. View "Fort Worth 4th Street Partners v. Chesapeake Energy Corp." on Justia Law

The Fifth Circuit dismissed this interlocutory appeal from an order denying a motion for a preliminary injunction to stop a foreclosure. The court applied In Matter of Sullivan Cent. Plaza, I, Ltd., and held that the appeal was moot because the subject property was sold at a foreclosure sale. The court rejected plaintiff's argument that the instant appeal was not moot simply because defendants purchased the foreclosed property and were before the court on appeal. The court reasoned that it could not enjoin that which had already taken place. View "Dick v. Colorado Housing Enterprises, LLC" on Justia Law

After negotiations failed between plaintiff and Trans-Pecos regarding the construction of a pipeline on plaintiff's land, Trans-Pecos invoked Texas eminent domain power via Tex. Util. Code 181.004. The Fifth Circuit affirmed the denial of plaintiff's application for a preliminary injunction under the Anti-Injunction Act. The district court held that the Act barred the injunction because the injunction would enjoin a state condemnation process that culminates in a judicial proceeding. As a preliminary matter, the court denied a motion to dismiss on mootness grounds. The court then held, on alternative grounds, that plaintiff could not meet the demanding standard for issuance of an injunction. The court explained that the significant differences between the Texas delegation of power to private entities and those delegations the Supreme Court has held unconstitutional mean that plaintiff's due process challenge faced long odds. Because of plaintiff's inability to establish a likelihood of success, much less a substantial one, he was not entitled to a preliminary injunction. View "Boerschig v. Trans-Pecos Pipeline, LLC" on Justia Law

The Fifth Circuit affirmed the district court's grant of summary judgment in favor of Deutsche Bank in an action challenging a foreclosure sale. The court held that the district court did not err in holding that the Rooker-Feldman doctrine did not preclude review of the parties' claims; the court has jurisdiction to hear this appeal; the district court did not err by granting summary judgment to Deutsche Bank because the Vacating Order was void under Texas law and plaintiffs failed to cite any authority demonstrating that the Foreclosure Order was void rather than voidable; and Texas law provided plaintiffs an adequate procedure to challenge the Foreclosure Order and their due process rights were not violated. View "Burciaga v. Deutsche Bank National Trust Co." on Justia Law

Daewoo filed suit against AMT, seeking an order compelling AMT to arbitrate an attachment of pig iron, invoking both maritime attachment and the Louisiana non-resident attachment statute, La. Code Civ. Proc. art. 3542. After the district court's grant of Daewoo's attachment, TKM attached the same pig iron in Louisiana state court and intervened in the federal suit. The district court agreed with TKM and vacated Daewoo's attachment. The Fifth Circuit vacated, holding that Section 3502 allowed Daewoo to seek a Section 3542 attachment before commencing its confirmation proceeding, Daewoo followed Section 3502's requirements, and thus Daewoo's attachment was valid. The court remanded for further proceedings. View "Stemcor USA Inc. v. Cia Siderurgica do Para Cosipar" on Justia Law

Plaintiff filed suit against Wells Fargo, alleging nonconformity with the requirements for foreclosing home equity loans and seeking a permanent injunction and forfeiture. The district court held that plaintiff's suit was time barred and dismissed under Federal Rule of Civil Procedure 12(b)(6). The Texas Supreme Court subsequently issued two opinions, Wood v. HSBC Bank USA, N.A., 505 S.W.3d 542 (Tex. 2016), and Garofolo v. Ocwen Loan Servicing, L.L.C., 497 S.W.3d 474 (Tex. 2016). The Fifth Circuit held that Wood and Garofolo constitute intervening changes in law sufficient to justify post-judgment relief for plaintiff on her claim to preclude foreclosure but not on her claim for forfeiture. Accordingly, the court affirmed in part, reversed in part, and remanded for further proceedings. View "Alexander v. Wells Fargo Bank" on Justia Law

The Fifth Circuit affirmed the dismissal of plaintiff's claims relating to his mortgage and the foreclosure of his home. The court held that the district court did not err in determining that diversity jurisdiction exists in this case; the district court did not err in dismissing plaintiff's claims for lack of standing to foreclose, quiet title, and breach of contract given that each of those claims was based on the assignment being void; in light of the district court's reasoning and the circumstances of this case, the district court did not abuse its discretion in denying plaintiff leave to replead his promissory estoppel claim; and plaintiff waived his argument that the district court erred in denying his motion to amend. View "Bynane v. The Bank of New York Mellon" on Justia Law

Plaintiffs filed suit against the condo owners association after the foreclosure sale of their condo unit, alleging common law claims for breach of contract, wrongful foreclosure, negligent misrepresentation, and breach of fiduciary duty, as well as violations of the Federal Debt Collection Practices Act (FDCPA), Texas Fair Debt Collection Practices Act (TFDCPA), and Texas Deceptive Trade Practices Act (TDTPA). The Fifth Circuit affirmed the district court's grant of summary judgment on all claims, holding that regardless whether the district court abused its discretion, any evidentiary error the district court made was harmless. In this case, the issue whether the late fee increase was properly adopted by the Association was not dispositive of any claims, so it did not affect the outcome of the litigation and did not affect their substantial rights. The court also held that plaintiffs' could not maintain their suit for breaches of the Condominium Declaration when they have themselves been in default of the contract; there was no authority supporting plaintiffs' conclusion that an inaccurate balance included in a default notice constitutes a defect in the foreclosure proceedings; and plaintiffs failed to cite specific negligent misrepresentations by defendants. The court rejected plaintiffs' remaining claims. View "Mahmoud v. De Moss Owners Association, Inc." on Justia Law