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

In an action arising from the bankruptcy of CISH, the Fifth Circuit affirmed the bankruptcy court's sanction of appellants. Appellants had filed an adversary proceeding asserting causes of action that the bankruptcy court had placed in trust for CISH's creditors, but the bankruptcy court concluded that by attempting to seize control of trust property, appellants had knowingly violated its order confirming the liquidation plan.The court concluded that it lacked jurisdiction to review the dismissal order because appellants did not file a notice of appeal on the adversary docket and the notice of appeal did not comply with the requirements of the bankruptcy rules for appealing the adversary proceeding. In regard to the punitive sanctions, appellants failed to allege an injury-in-fact and the court lacked jurisdiction. Finally, because the bankruptcy court had jurisdiction over the Cleveland Imaging bankruptcy case, it had jurisdiction to enter the sanctions order, too; likewise, the court has jurisdiction to consider appellants' appeal; appellants have standing to appeal the sanctions order; the bankruptcy court did not err in finding that appellants violated its confirmation order by filing their adversary proceeding and contentions to the contrary lack merit; and clear and convincing evidence supported the bankruptcy court's finding of bad faith. View "Kreit v. Quinn" on Justia Law

The Fifth Circuit affirmed the district court's denial of qualified immunity to defendants in a 42 U.S.C. 1983 action for conspiracy to commit retaliatory employment termination. The court concluded that plaintiff plausibly averred that defendants deprived him of his First Amendment rights, and that defendants had fair warning that using their respective government positions to violate plaintiff's First Amendment rights would be objectively unreasonable in light of clearly established law at the time. The court also concluded that plaintiff has also stated a claim for conspiracy under section 1983. View "Bevill v. Fletcher" on Justia Law

Kelly owns 160 acres within compulsory oil and gas drilling and production units established by the Louisiana Commissioner of Conservation. Aethon is the designated operator of the units which include 16 producing wells. Kelly’s land is not subject to a valid oil, gas or mineral lease to Aethon or to anyone else. Louisiana’s oil and gas conservation law provides that the Commissioner may establish a drilling unit even if all owners of oil and gas interests have not agreed to pool their interests. When the operator proposes to drill a well in a unit, owners may participate in the risk by contributing to the drilling costs. If an owner does not participate and the well produces, the operator may recover out of production the nonparticipating owner’s share of expenditures and, in certain cases, a “risk charge” of 200 percent of that expenditure share. Louisiana law requires operators to report information to unleased owners if requested.Kelly sought a declaration that Aethon failed to comply with disclosure and reporting obligations and had forfeited its right to demand contribution from Kelly. In two certified mail letters to Aethon, Kelly had informed Aethon that it was an unleased owner within the Units and requested information regarding the wells, and subsequently, cited Aethon’s failure to provide that information. The district court granted Aethon summary judgment. The Fifth Circuit vacated in part. The district court impermissibly imposed requirements on Kelly that are not present in the statutes. Kelly’s letters complied with the statute. View "B A Kelly Land Co., L.L.C. v. Aethon Energy Operating, L.L.C." on Justia Law

Plaintiff filed suit against numerous individuals and entities after he was exonerated and released from prison after serving seventeen years for a rape he did not commit. The only remaining claim is for false imprisonment under Texas state law against two retired El Paso, Texas detectives who were involved in the investigation of his 1987 rape charges.The Fifth Circuit noted that the elements of false imprisonment under Texas state law are (1) willful detention; (2) without consent; and (3) without authority of law, and that the plaintiff must satisfy all three elements to prevail on his false imprisonment claim. The court affirmed the district court's grant of summary judgment in favor of the detectives, concluding that plaintiff failed to satisfy the first element—willful detention by the defendants. The court explained that willful detention may be shown even when the defendant does not actively detain the plaintiff if the defendant instigates the false imprisonment: that is to say, the defendant engages in conduct that is intended to cause one to be detained, and in fact causes the detention. In this case, there is no evidence to support plaintiff's contention that defendants instigated his arrest. Therefore, because plaintiff fails to demonstrate that his arrest was instigated by the detectives, his false imprisonment claim under Texas state law fails. View "Moon v. Olivarez" on Justia Law

Earnest sued Sanofi as part of the multidistrict litigation over several pharmaceutical companies’ alleged failure to warn users of Taxotere (generically docetaxel), a chemotherapy drug, of the risk of permanent alopecia or hair loss. At trial, Sanofi elicited testimony from two medical doctors: Dr. Glaspy was accepted as an expert witness under Federal Rule of Evidence 702; Dr. Kopreski was offered as Sanofi’s designated corporate representative under FRCP 30(b)(6). As a general matter, both testified that little medical evidence linked Taxotere to permanent hair loss. On appeal Earnest challenged the admission of Dr. Kopreski’s testimony, arguing it was actually expert testimony admitted in contravention of Rule 702 and “Daubert” and that because Dr. Glaspy’s testimony relied in relevant parts on Dr. Kopreski’s testimony, it also should not have been admitted.The Fifth Circuit reversed and remanded for a new trial. Sanofi’s maneuvers in cloaking Dr. Kopreski’s quasi-expert testimony as “lay witness” opinion testimony under Rule 701, and then using Dr. Glaspy to repeat it as expert analysis, effected a concerning end-run around Rule 702. Because this strategy allowed Sanofi to shoehorn inadmissible opinion testimony into evidence and then emphasize those “expert” conclusions in closing arguments to the jury it significantly prejudiced Earnest’s case. View "Earnest v. Sanofi US Services, Inc." on Justia Law

MDK, a Bolivian entity, filed suit against Proplant, a Texas-based corporation under both breach of contract and tort theories. The Fifth Circuit affirmed the district court's grant of summary judgment in favor of Proplant, concluding that MDK did not meet the Federal Rule of Civil Procedure 56(d) standard for deferring summary judgment, and thus the district court did not err by ruling on Proplant's summary judgment motion before the parties had completed discovery. In this case, MDK's opening brief failed to adequately present its arguments that Proplant's summary judgment motion and the district court's summary judgment order were "legally deficient." Therefore, MDK has waived these issues.Finally, the court rejected MDK's contention that the district court erred in granting summary judgment on MDK's two breach of contract claims. In regard to the first claim, the court concluded that MDK has not pointed to any evidence suggesting that it did in fact execute the October Document. In regard to the second claim, the court concluded that MDK failed to meet its burden of demonstrating by competent evidence that there is a dispute of material fact as to whether YPFB awarded Proplant the O&M contract. View "MDK Sociedad de Responsabilidad Limitada v. Proplant Inc." on Justia Law

The Fifth Circuit affirmed the district court's judgment affirming the bankruptcy court's orders in these consolidated cases arising out of the bankruptcy of PFO and a dispute over the validity and scope of the bankruptcy court's orders prohibiting one non-debtor, VSP, from asserting claims against two non-debtors, Hillair Capital Investments L.P. and Hillair Capital Management L.L.C.The court found that the bankruptcy court had jurisdiction to enter the Lift Stay Order and it retained jurisdiction to interpret and enforce its orders, as it did in the 2019 orders. The court concluded that the bankruptcy court would not have abused its discretion in refusing to abstain under 28 U.S.C. 1334(c)(2) as there was no timely motion for abstention. The court also concluded that the district court correctly interpreted the Lift Stay Order as prohibiting VSP's assertion of claims against Hillair in the California Action. Finally, the court affirmed the award of attorneys' fees and the earlier bankruptcy court's orders. View "VSP Labs v. Hillair Capital Investments, LP" on Justia Law

JetPay is a national company offering credit card processing services to merchants and banks. JetPay processed credit card payments for customers purchasing tickets from Direct Air, placing the funds in Direct Air's escrow account until the passengers took the flights. After Direct Air ended its operations and filed for bankruptcy, JetPay asserts that it was contractually obligated to use its own funds to reimburse thwarted passengers. JetPay timely filed with the IRS for a refund of the excise taxes it repaid to the consumers, but the IRS denied the claim.The Fifth Circuit affirmed the district court's adverse grant of summary judgment against JetPay, agreeing with the district court that the company was not a proper party to seek a refund from the IRS. JetPay did not pay the tax to the Secretary, and thus the court did not consider whether the company qualifies as "the person who collected the tax" under 26 U.S.C. 6415(a). In this case, JetPay is neither a customer required to pay the tax before taking a flight nor an airline required to collect it. The court also concluded that the economic burden test does not apply to JetPay's case. Finally, the court rejected JetPay's equitable subrogation claim. View "JetPay Corp. v. United States" on Justia Law

The Fifth Circuit concluded that the district court did not abuse its discretion by denying defendant's motion for a sentence reduction under Section 404 of the First Step Act of 2018. The court agreed with the Government that, contrary to defendant's contention, the district court could have considered the unused enhancement at the 2009 sentencing proceeding, and therefore it did not abuse its discretion by considering that information in its 2020 order. In this case, the district court implicitly recognized its duty to impose a sentence as if all the conditions for the original sentencing were again in place with the one exception of the changes in the law wrought by the Act. The district court ultimately concluded that given the valuable consideration of both parties reflected by the plea agreement, it would exercise its discretion to deny defendant's motion. View "United States v. Lyons" on Justia Law

The Fifth Circuit affirmed the district court's judgment in favor of Schlumberger in an action brought by Hess for breach of contract. Hess had contracted with Schlumberger to provide safety valves for several of Hess's deep-sea oil wells in the Gulf of Mexico. After Hess experienced problems with the valves, Schlumberger recalled them. Hess filed suit claiming that it was entitled to revoke its acceptance of the valves that Schlumberger had provided.The court upheld the district court's interpretation of two sections of API 14A standards that were incorporated into the sales contract. In this case, the district court did not err in interpreting API 14A Section 6.3.2.2 to require only that the drawings remain substantially the same and that the valves be manufactured using those drawings. Furthermore, the district court did not err in interpreting API 14A Section 7.6.2 regarding the seal spring (aka rosette spring) and that the contract contemplated dimensional inspection of the seal assemblies rather than inspection of the rosette springs within that assembly. The court also concluded that the district court did not clearly err in making its factual findings relative to Schlumberger's compliance with 6.3.2.2. Assuming without deciding that Hess is correct that the proper standard is "producing cause," the court concluded that the district court's order is consistent with the application of such a rule. Finally, the district court did not clearly err in finding that any alleged non-conformity did not cause the valves' failure which in turn would have impaired their value. View "Hess Corp. v. Schlumberger Technology Corp." on Justia Law