Justia U.S. 5th Circuit Court of Appeals Opinion Summaries
State of Texas v. Trump
Three states challenged an executive order issued by President Joseph R. Biden, which mandated that federal contractors pay their workers a minimum hourly wage of $15. The states argued that the President exceeded his authority under the Federal Property and Administrative Services Act (FPASA) and that the order violated the Administrative Procedure Act (APA) and the nondelegation doctrine. The district court for the Southern District of Texas agreed with the states, finding that the FPASA did not grant the President broad authority to set minimum wages for federal contractors and that the executive order was a major question beyond the President's authority. The court permanently enjoined the executive order.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court examined whether the executive order was a permissible exercise of the President's authority under the FPASA. The court found that the FPASA's language was clear and unambiguous, granting the President broad authority to prescribe policies necessary to carry out the Act's provisions, as long as those policies were consistent with the Act. The court determined that the executive order met these requirements, as it aimed to promote economy and efficiency in federal procurement by ensuring contractors paid their workers adequately.The Fifth Circuit also addressed the application of the major questions doctrine, concluding that it did not apply in this case because the FPASA's text was clear and unambiguous. The court noted that the President's exercise of proprietary authority in managing federal contracts did not raise a major question requiring clear congressional authorization. Consequently, the court reversed the district court's permanent injunction and remanded the case for further proceedings consistent with its opinion. View "State of Texas v. Trump" on Justia Law
Pie Development v. Pie Carr Holdings
Pie Development, L.L.C. was formed to develop an application to streamline the process of purchasing workers compensation insurance. The company alleged that Dax Craig, a consultant, stole the idea and shared it with John Swigart. Craig and Swigart then used the idea to create Pie Insurance Holdings, Inc. and other affiliated entities, generating significant profits. Pie Development sued Craig, Swigart, Pie Insurance Holdings, and Pie Insurance Services, alleging misappropriation of trade secrets under the Mississippi Uniform Trade Secrets Act (MUTSA) and the federal Defend Trade Secrets Act (DTSA), among other claims.The United States District Court for the Southern District of Mississippi dismissed the complaint for failing to provide sufficient detail on each claim, but allowed Pie Development to amend its complaint within thirty days. Pie Development chose not to amend and instead appealed. The United States Court of Appeals for the Fifth Circuit affirmed the district court's decision, noting that Pie Development did not sufficiently plead that it took reasonable measures to protect its business plan's secrecy.While the appeal was pending, Pie Development filed a new lawsuit against additional defendants, including Pie Carrier Holdings, Gallatin Point Capital, Sirius Point Ltd., and Pie Casualty Insurance Company, and later added the original defendants. The district court dismissed the new claims, citing res judicata, as the claims were identical to those in the first lawsuit. Pie Development appealed this decision.The United States Court of Appeals for the Fifth Circuit reviewed the case and affirmed the district court's dismissal. The court held that res judicata applied because the prior action was concluded by a final judgment on the merits when Pie Development chose to appeal rather than amend its complaint. The court also found that Pie Development failed to state a claim against Gallatin and Sirius, as the complaint did not plausibly allege that they knew or should have known about the misappropriation of trade secrets. View "Pie Development v. Pie Carr Holdings" on Justia Law
Posted in:
Civil Procedure, Intellectual Property
Reese v. Bureau of Alcohol, Tobacco, Firearms, and Explosives
The case involves a challenge to the constitutionality of 18 U.S.C. §§ 922(b)(1) and (c)(1), which prohibit Federal Firearms Licensees (FFLs) from selling handguns to individuals aged eighteen to twenty. The plaintiffs, including individuals in this age group and several nonprofit organizations, argue that these provisions infringe on their Second Amendment rights and deny them equal protection under the Fifth Amendment.The United States District Court for the Western District of Louisiana found that the plaintiffs had standing but dismissed the case under Rule 12(b)(6). The district court assumed that the Second Amendment's plain text covered the purchase of firearms by eighteen-to-twenty-year-olds but concluded that the prohibition was consistent with the nation's historical tradition of firearm regulation, relying on the framework established by the Supreme Court in New York Rifle & Pistol Ass’n, Inc. v. Bruen.The United States Court of Appeals for the Fifth Circuit reviewed the case and concluded that the Second Amendment does cover the right of eighteen-to-twenty-year-olds to purchase firearms. The court found that the historical evidence presented by the government, including 19th-century laws, was insufficient to establish a tradition of restricting firearm rights for this age group in a manner similar to the contemporary federal handgun purchase ban. The court emphasized that the Second Amendment's protections extend to all law-abiding, adult citizens, including those aged eighteen to twenty.The Fifth Circuit held that 18 U.S.C. §§ 922(b)(1) and (c)(1) and their attendant regulations are unconstitutional as they are inconsistent with the nation's historical tradition of firearm regulation. The court reversed the district court's judgment and remanded the case for further proceedings consistent with its opinion. View "Reese v. Bureau of Alcohol, Tobacco, Firearms, and Explosives" on Justia Law
Posted in:
Civil Rights, Constitutional Law
McDonnel Group v. Starr Surplus Lines
In 2014, McDonnel Group, L.L.C. served as the general contractor for the renovation of Jung, L.L.C.'s property. In 2015, McDonnel obtained insurance from Starr Surplus Lines Insurance Company and Lexington Insurance Company. In 2017, the project experienced significant water damage, leading McDonnel to file a claim for $3,226,164.30. The dispute arose over the flood deductible amount, with McDonnel asserting it was $500,000, while the insurers claimed it was $3,443,475, resulting in no payout under the policy.The United States District Court for the Eastern District of Louisiana granted summary judgment in favor of the insurers, determining that the policy language regarding the flood deductible was clear and unambiguous. The plaintiffs appealed, and the United States Court of Appeals for the Fifth Circuit found the policy language ambiguous and remanded the case for further proceedings to consider extrinsic evidence and the presumption in favor of coverage.Upon remand, the district court reviewed supplemental briefings and extrinsic evidence, ultimately finding in favor of the insurers. The court concluded that the extrinsic evidence resolved the ambiguity, showing that the industry standard interpretation of "VARTOL" (value-at-risk-at-time-of-loss) supported the insurers' deductible calculation. The plaintiffs appealed again.The United States Court of Appeals for the Fifth Circuit affirmed the district court's decision. The appellate court agreed that the extrinsic evidence provided by the insurers, including industry standards and expert testimony, resolved the ambiguity in the policy language. The court also held that the district court did not err in not applying the presumption in favor of coverage, as the ambiguity had been resolved through extrinsic evidence. View "McDonnel Group v. Starr Surplus Lines" on Justia Law
Posted in:
Insurance Law
Carmona v. Olvera
Ignacia Carmona, representing herself and the estate of Veronica Carmona, filed a lawsuit against the City of Brownsville and several officers, claiming that the officers failed to provide necessary medical care to Veronica Carmona, who died while in pretrial detention. Veronica had been involved in multiple car accidents on the same night and exhibited visible injuries. Despite this, the officers did not seek medical attention for her, and she was later found dead in her cell due to internal bleeding from liver lacerations.The United States District Court for the Southern District of Texas dismissed the claims against the officers, granting them qualified immunity. The court concluded that the complaint did not plausibly allege that the officers had subjective knowledge of a substantial risk of serious harm to Veronica Carmona. The court found that the officers' failure to seek medical care did not amount to deliberate indifference because the injuries were not visibly apparent, and there were no complaints from Carmona that revealed the full extent of her injuries.The United States Court of Appeals for the Fifth Circuit reviewed the case and affirmed the district court's decision. The appellate court held that the plaintiff failed to plausibly allege that the officers were subjectively aware of the risk of internal bleeding. The court emphasized that actual knowledge of the risk is required for liability, and mere negligence or the fact that the officers should have known about the risk is insufficient. As a result, the officers were entitled to qualified immunity, and the dismissal of the deliberate-indifference claims was upheld. View "Carmona v. Olvera" on Justia Law
Posted in:
Civil Rights, Criminal Law
National Automobile Assoc v. Federal Trade Commission
The National Automobile Dealers Association and the Texas Automobile Dealers Association challenged the Federal Trade Commission's (FTC) Combating Auto Retail Scams Trade Regulation Rule (CARS Rule). They argued that the FTC violated its own regulations by not issuing an advance notice of proposed rulemaking (ANPRM), failed to provide a reasoned basis for the rule, and conducted an arbitrary and capricious cost-benefit analysis. Alternatively, they requested a remand for additional evidence consideration.The FTC published the CARS Rule without an ANPRM, which led to the petitioners seeking judicial review. The rule aimed to address deceptive practices in the auto sales industry, including misrepresentations, mandatory disclosures, prohibitions on valueless add-ons, and requirements for consumer consent. The FTC received over 27,000 comments during the rulemaking process.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court found that the FTC violated its own regulations by not issuing an ANPRM, which is required under subpart B procedures for rules promulgated under section 18(a)(1)(B) of the FTC Act. The court determined that the Dodd-Frank Act did not grant the FTC independent substantive authority to bypass the ANPRM requirement. The court also rejected the FTC's argument for deference under Auer v. Robbins and Kisor v. Wilkie, finding no relevant ambiguity in the regulations.The court concluded that the FTC's failure to issue an ANPRM was not harmless error, as it deprived the petitioners of a procedural benefit that could have influenced the final rule. Consequently, the court granted the petition for review and vacated the CARS Rule, without addressing the petitioners' remaining substantive challenges. View "National Automobile Assoc v. Federal Trade Commission" on Justia Law
Posted in:
Consumer Law, Government & Administrative Law
Baker Hughes v. Dynamic Industries
In 2017, Baker Hughes Saudi Arabia Co., Ltd. (Baker Hughes) and Dynamic Industries Saudi Arabia, Ltd. (Dynamic) entered into a subcontract for an oil-and-gas project in Saudi Arabia. The subcontract included provisions for resolving disputes through arbitration, with Dynamic having the option to demand arbitration in Saudi Arabia. If Dynamic did not demand arbitration in Saudi Arabia, either party could initiate arbitration under the rules of the Dubai International Financial Centre’s joint partnership with the London Court of International Arbitration (DIFC-LCIA). In 2021, the United Arab Emirates abolished the DIFC-LCIA and created a new arbitral institution. A contract dispute arose, and Baker Hughes sued in state court, which was then removed to federal court. Dynamic moved to dismiss for forum non conveniens or to compel arbitration under Schedule E of the subcontract. The district court denied Dynamic’s motion, stating that the designated forum no longer existed, making the forum-selection clause unenforceable.The United States District Court for the Eastern District of Louisiana reviewed the case and denied Dynamic’s motion to dismiss or compel arbitration, reasoning that the DIFC-LCIA no longer existed, thus invalidating the forum-selection clause.The United States Court of Appeals for the Fifth Circuit reviewed the case and held that the district court erred in refusing to compel arbitration. The appellate court found that the subcontract’s Schedule E designated only the rules of arbitration, not a specific forum. Even if the DIFC-LCIA was considered the designated forum, the court concluded that the forum-selection clause was not integral to the subcontract. The court reversed the district court’s decision and remanded the case for further proceedings, instructing the district court to consider whether the DIFC-LCIA rules could be applied by another available forum, such as the LCIA, DIAC, or a forum in Saudi Arabia, and to compel arbitration accordingly. The court also partially granted and denied Baker Hughes’s motion to strike portions of Dynamic’s reply brief. View "Baker Hughes v. Dynamic Industries" on Justia Law
Posted in:
Arbitration & Mediation, Energy, Oil & Gas Law
Aguilar-Quintanilla v. McHenry
Edgard Ernesto Aguilar-Quintanilla, a native and citizen of El Salvador, was removed from the United States in 2009 and unlawfully reentered in 2022. After being apprehended, the Department of Homeland Security (DHS) issued a notice of reinstatement of his prior removal order. However, due to the inadvertent disclosure of his personal information, DHS dismissed the withholding-only proceedings and placed him in removal proceedings. Aguilar-Quintanilla admitted to being removable and applied for asylum, statutory withholding of removal, and protection under the Convention Against Torture (CAT), claiming that he would be tortured by the Salvadoran government as a suspected gang member due to his tattoos and criminal record.The Immigration Judge (IJ) denied all relief, finding Aguilar-Quintanilla's testimony not credible and determining that general country conditions evidence alone did not entitle him to CAT protection. The Board of Immigration Appeals (BIA) upheld the IJ's decision, and Aguilar-Quintanilla filed a petition for review, challenging only the denial of deferral of removal under the CAT.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court found that Aguilar-Quintanilla's removal did not moot his appeal because ICE could facilitate his return to the United States if his petition were granted. The court held that the BIA and IJ failed to consider critical evidence, including affidavits describing a 2023 incident where police searched for Aguilar-Quintanilla at his father's home, in their likelihood-of-torture assessment. The court granted Aguilar-Quintanilla's petition for review and remanded the case for further proceedings consistent with its opinion. View "Aguilar-Quintanilla v. McHenry" on Justia Law
Posted in:
Immigration Law
United States v. Giglio
Damion Giglio, while on supervised release for a previous felony, was arrested and convicted for violating 18 U.S.C. § 922(g)(1), the felon-in-possession statute. He appealed, arguing that the statute is unconstitutional as applied to him and that the district court erred in calculating his sentencing guideline range, entitling him to a less severe sentence.The United States District Court for the Southern District of Mississippi denied Giglio's motion to dismiss the indictment, rejecting his constitutional challenge. Giglio pleaded guilty, and the court sentenced him to 27 months' imprisonment, noting that it would have imposed the same sentence regardless of any potential guideline calculation errors.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court held that the government could regulate Giglio’s firearm possession without violating the Second Amendment, as historical practices support disarming individuals serving criminal sentences. The court also found that any error in the sentencing guideline calculation was harmless because the district court explicitly stated it would have imposed the same sentence regardless of the guideline range.The Fifth Circuit affirmed the district court's decision on both grounds, upholding Giglio's conviction and sentence. View "United States v. Giglio" on Justia Law
Posted in:
Constitutional Law, Criminal Law
New Orleans City v. Aspect Energy
The City of New Orleans filed a lawsuit against several pipeline operators and Entergy New Orleans LLC, alleging that their oil and gas production and transportation activities caused damage to the City's coastal zone. The City claimed that Entergy allowed its pipeline canals to widen and erode, threatening the City's storm buffer. The lawsuit was filed under Louisiana’s State and Local Coastal Resources Management Act of 1978 (SLCRMA).The defendants removed the case to federal court, arguing that Entergy, the only in-state defendant, was improperly joined to defeat diversity jurisdiction. Entergy consented to the removal and argued that it was exempt from SLCRMA’s permit requirements because its activities commenced before the statute's effective date. The City moved to remand the case to state court, but the United States District Court for the Eastern District of Louisiana denied the motion, dismissed Entergy as a party, and stayed the case pending appeal.The United States Court of Appeals for the Fifth Circuit reviewed the case and affirmed the district court's judgment. The appellate court held that Entergy was improperly joined because its activities were exempt under SLCRMA’s Historical-Use Exception, which applies to uses legally commenced before the statute's effective date. The court found no reasonable basis for the City to recover against Entergy, thus disregarding Entergy's citizenship and establishing complete diversity among the parties. The court also rejected the City's argument that it was merely a nominal party representing Louisiana, concluding that the City filed the suit on its own behalf and stood to benefit from a favorable ruling. Consequently, the appellate court affirmed the district court's denial of the City's motion to remand. View "New Orleans City v. Aspect Energy" on Justia Law