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

The Fifth Circuit affirmed the district court's dismissal of plaintiff's qui tam claims under the False Claims Act (FCA), alleging that Canon overcharged the United States for office equipment and provided non-compliant products. The court concluded that plaintiff's claims against Canon were barred by the FCA's public-disclosure provision. The court agreed with both the magistrate and district judges that Canon satisfied its burden of showing that plaintiff's allegations against Canon are "based upon" the allegations and transactions asserted in plaintiff's prior FCA suit, which the government settled years earlier. View "United States ex rel. Schweizer v. Canon, Inc." on Justia Law

Plaintiffs filed a claim on their homeowners' insurance policy with Travelers after a fire at their home. Travelers made some early payments; plaintiffs asserted that much more was owed; the parties agreed to an appraisal; the appraisal award came in closer to plaintiffs' view of the damages; and Travelers paid the additional amount.The Fifth Circuit held that the payment of the appraisal award prevents a plaintiff from continuing to pursue a breach of contract claim against an insurer. The court also held that an insurer can be liable under the Texas Prompt Payment of Claims Act for failing to timely pay the full damages it owed even though it timely made sizeable payments in response to the claim. The court explained that payment and acceptance of an appraisal award means there is nothing left for a breach of contract claim seeking those same damages. But a plaintiff may still have a claim under the prompt payment law after it accepts an appraisal award. Furthermore, the Supreme Court of Texas recently held that even a preappraisal payment that seemed reasonable at the time does not bar a prompt-payment claim if it does not "roughly correspond" to the amount ultimately owed. See Hinojos v. State Farm Lloyds, 619 S.W.3d 651, 658 (Tex. 2021).In this case, the court affirmed the dismissal of the contract claims where there is no evidence that Travelers failed to pay any amounts due and plaintiffs failed to explain why the amount paid was insufficient. However, in light of Hinojos, the court concluded that Travelers' preappraisal payment is not a defense to liability under the Texas Prompt Payment of Claims Act. Therefore, plaintiffs' claim seeking interest for late payment of dwelling coverage must be remanded. View "Randel v. Travelers Lloyds of Texas Insurance Co." on Justia Law

Kelley wanted to publish “Hooker to Looker,” to promote her cosmetics business. Di Angelo agreed to publish and distribute Kelley’s then-unwritten Book, with Kelly receiving 50 percent of the net royalties. Kelley provided Di Angelo with a three-page manuscript, detailing her background and outlining the Book’s topics. Di Angelo claims it wrote the Book while “communicating and/or collaborating with Kelley.” The Book Di Angelo distributed lists only Kelley as the copyright holder. Di Angelo sold the initial 1,000-copy print run. Kelley asked Di Angelo for an updated version. Di Angelo alleges that it prepared the updated work, then discovered that Kelley was attempting to work directly with Di Angelo’s printer, in violation of the contract.Kelley sued, claiming that Di Angelo overcharged her and alleging that she “is the sole owner of all copyrights.” Di Angelo counterclaimed for breach of contract. That state court action is pending. Di Angelo filed a federal suit, seeking a declaration that it owns the copyrights. Kelley challenged federal jurisdiction, arguing the claim was premised solely on her alleged breach of the contract, a controversy governed by Texas law. Di Angelo claimed resolution of the authorship dispute required interpretation of federal copyright law, including the definitional and ownership provisions in 17 U.S.C. 101 & 201, which the state court lacks jurisdiction to address. The Fifth Circuit reversed the dismissal of the suit. Di Angelo’s claim necessarily implicates federal law definitions of “Initial ownership” and “Works made for hire.” View "Di Angelo Publications, Inc. v. Kelley" on Justia Law

Defendant pleaded guilty to three drug distribution charges and being a felon in possession of a firearm. The Fifth Circuit affirmed the sufficiency of the factual basis to support the conspiracy charge. In this case, there was no error, let alone plain error that affected defendant's substantial rights where the evidence found at his home, along with his statements to law enforcement, clearly show that he was involved in a drug distribution conspiracy. However, the court remanded for the limited purpose to allow the district court to amend the written judgment to conform to the oral sentence. View "United States v. Escajeda" on Justia Law

Plaintiff, a former inmate, filed suit against his nurses and his physician under 42 U.S.C. 1983, alleging they were deliberately indifferent to his medical needs in violation of the Eighth Amendment. The district court denied defendants' motion for summary judgment, finding that, at that juncture, they were not entitled to qualified immunity.The Fifth Circuit affirmed the district court's denial of summary judgment and remanded for further proceedings. The court concluded that plaintiff has introduced evidence showing that officials knowingly furnished treatment unresponsive to his need. In this case, they ignored his inability to walk and refused to treat his lost mobility, permitting the inference that they intentionally treated him incorrectly. The court saw no meaningful distinction between an official's decision to offer plainly unresponsive treatment to a prisoner and his decision to refuse to treat him, ignore his complaints, or intentionally treat him incorrectly. Therefore, at minimum, the court concluded that plaintiff introduced evidence that officials engaged in similar conduct that would clearly evince a wanton disregard for his serious medical need. Furthermore, this rises to the level of deliberate indifference. The court also concluded that defendants had fair warning that their delay in treating plaintiff's fractured hip beyond the most cursory care violated his Eighth Amendment rights. View "Spikes v. McVea" on Justia Law

Petrobras, the American subsidiary of a Brazilian oil and gas producer, alleges that Samsung, a Korean shipbuilder, secretly bribed Petrobras executives to finalize a contract between Petrobras and Pride. In a 2007 contract, Samsung had an option to build a deep-sea drillship if Pride secured a drilling-services contract with another company. Samsung arranged to bribe Petrobras executives to secure Pride's contract for the construction of DS-5. After Petrobras put DS-5 on permanent standby and conducted an internal audit, it informed Brazilian prosecutors. A 2014 investigation into corruption throughout Brazil, included a separate bribery scheme in which Samsung contracted with Petrobras to construct two other ships.In 2019, Petrobras sued Samsung for its role in the bribery that led to the Petrobras–Pride DS-5 contract, citing common-law fraud under Texas law and the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. 1962(c),(d). The district court took judicial notice of Petrobras’s 2014 SEC filing and Washington Post and Reuters articles, describing the bribery schemes underlying other Samsung–Petrobras contracts that did not mention the Petrobras–Pride DS-5 contract. From those, the court inferred that Petrobras was on notice by 2014 that the DS-5 contract was suspect. Holding that “the specific drillship in this case is not subject to its own limitations clock,” the district court dismissed the suit. The Fifth Circuit reversed. The pleadings do not establish as a matter of law that Petrobras had actual or constructive notice of its injury before March 2015, so dismissal at the pleading stage was improper. View "Petrobras America, Inc. v. Samsung Heavy Industries Co., Ltd." on Justia Law

The Fifth Circuit affirmed defendant's conviction for detonating a bomb outside a church's administrative building under 18 U.S.C. 844(i), which requires that the building damaged by fire or explosion be used in or influence interstate commerce. The court agreed with the district court's conclusion that the church's administrative building met the statute's affecting-interstate-commerce requirement because it housed the offices that coordinated the rental of the church's facilities to outside parties and the church's tuition-based childcare programs. In this case, the church's interstate connections are direct, regular, and substantial. View "United States v. Torres" on Justia Law

The Fifth Circuit affirmed the district court's decision to vacate its judgment in a breach-of-fiduciary-duty action based on lack of subject-matter jurisdiction. In this case, after the firm filed suit to recover its fees, the parties reached an agreed judgment. The district court then discovered that it lacked subject-matter jurisdiction.The court concluded that the district court lacked subject-matter jurisdiction under 28 U.S.C. 1332 because the firm is a Texas plaintiff suing a Texas defendant, and the combination of the firm's misleading citizenship allegations and the district court's lack of knowledge about it rendered the judgment void and properly vacated under Federal Rule of Civil Procedure 60(b)(4). The court read Picco v. Global Marine Drilling Co., 900 F.2d 846 (5th Cir. 1990), fairly and holistically, finding that Picco accords with the court's decision here. The court also concluded that the firm forfeited its standing argument. Finally, the court concluded that the district court had jurisdiction to direct the firm to return fees paid pursuant to a void judgment. View "The Mitchell Law Firm, LP v. Bessie Jeanne Worthy Revocable Trust" on Justia Law

Plaintiffs filed suit alleging that defendants purchased trademark terms as keywords for search-engine advertising, then placed generic advertisements that confused customers as to whether the advertisements belonged to or were affiliated with plaintiffs. Plaintiffs alleged claims for trademark infringement in violation of the Lanham Act and claims under Texas law.The Fifth Circuit reversed the district court's dismissal of the complaint for failure to state a claim, vacated the denial of leave to amend, and remanded for further proceedings. The court agreed with Southwest Recreational, Ninth Circuit precedent, and the author of a leading treatise that in the context of internet searches and search-engine advertising in particular, the critical issue is whether there is consumer confusion and that distraction is insufficient. In regard to plaintiff's trademark infringement claims, the court concluded that whether an advertisement incorporates a trademark that is visible to the consumer is a relevant but not dispositive factor in determining a likelihood of confusion in search-engine advertising cases. In this case, plaintiff's complaint contains sufficient factual matter, accepted as true, to state a Lanham Act claim that is plausible on its face. View "Jim S. Adler, PC v. McNeil Consultants, LLC" on Justia Law

The Fifth Circuit affirmed defendant's sentence for conspiring to possess methamphetamine. In this case, the district court imposed special conditions of release and temporarily denied defendant federal benefits—even though the plea agreement did not mention those aspects of sentencing.The court concluded that the district court did not err, plainly or otherwise, in imposing a five-year ineligibility for federal benefits or special conditions of supervised release where the parties did not form any agreement regarding ineligibility or special conditions. The court explained that, where an agreement is silent about a condition, it provides no evidence that the government promised or that defendant bargained for the relevant condition. Therefore, the silence in defendant's plea agreement did not cabin the district court's discretion regarding ineligibility or special conditions. The court also concluded that defendant's appeal waiver bars her contention that the district court misapplied 21 U.S.C. 862. View "United States v. Butler" on Justia Law