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

The case involves SKAV, L.L.C., the owner of a Best Western hotel in Abbeville, Louisiana, and Independent Specialty Insurance Company. The hotel was damaged by Hurricane Laura in August 2020, and SKAV filed a claim on a surplus lines insurance policy it had purchased from Independent Specialty. The policy contained an arbitration clause requiring all disputes to be settled by arbitration. However, SKAV sued Independent Specialty in the Western District of Louisiana, alleging that the insurance company had failed to adequately cover the hotel's hurricane damage under the policy's terms. Independent Specialty moved to compel arbitration, but the district court denied the motion, citing a prior decision that concluded that § 22:868 of the Louisiana Revised Statutes voids an arbitration provision in a contract for surplus lines insurance.The case was appealed to the United States Court of Appeals for the Fifth Circuit. The main dispute was the effect of § 22:868 of the Louisiana Revised Statutes on the insurance policy's arbitration clause. The statute bars insurance policies from depriving Louisiana courts of jurisdiction and permits, in limited circumstances, forum- and venue-selection provisions. The court noted that there were conflicting decisions on this issue from district courts in Louisiana and New York.The Fifth Circuit Court of Appeals affirmed the district court's decision. The court concluded that the arbitration clause in the surplus lines insurance policy was void under § 22:868. The court reasoned that the Louisiana Legislature's 2020 amendments to the statute did not reverse the state's longstanding anti-arbitration policy. The court also rejected Independent Specialty's argument that the issue of the arbitration clause's validity must itself go to arbitration, stating that when a statute prevents the valid formation of an arbitration agreement, the court cannot compel arbitration, even on threshold questions of arbitrability. View "S. K. A. V. v. Independent Specialty Insurance Co." on Justia Law

The case involves Mid Valley Pipeline Company, an interstate pipeline company, and the Board of Mississippi Levee Commissioners. In 1949, the Levee Board granted Mid Valley a permit to construct and maintain two pipelines across a levee in Mississippi. The permit was not limited to a term of years and could be revoked by the Levee Board if Mid Valley failed to comply with any of the permit's conditions. In 2005, Mid Valley was instructed to relocate its pipelines, which it did at a cost of over $700,000. In 2020, the Levee Board informed Mid Valley that it would be charging an annual pipeline crossing fee and would revoke all existing permits for pipelines not currently paying the fee. Mid Valley did not respond to these notices.The United States District Court for the Northern District of Mississippi granted summary judgment in favor of the Levee Board, dismissing Mid Valley's claim that the imposition of the annual fee and the revocation of the permit violated the Contract Clause of the United States Constitution. The court reasoned that the 1949 permit was not a contract.On appeal, the United States Court of Appeals for the Fifth Circuit affirmed the district court's decision. The appellate court agreed with the district court that the 1949 permit was not a contract. The court noted that under Mississippi law, a contract requires mutual assent, among other elements. The court found that the permit was a unilateral grant of permission by the Levee Board, and there was no evidence of mutual assent to form a contract. Therefore, the Levee Board's actions did not violate the Contract Clause. View "Mid Valley Pipeline v. Rodgers" on Justia Law

The case involves a challenge to a rule adopted by the Securities and Exchange Commission (SEC) aimed at enhancing the regulation of private fund advisers. The rule was designed to protect investors who invest in private funds and to prevent fraud, deception, or manipulation by the investment advisers to those funds. The petitioners, a group of associations representing private fund managers, challenged the rule, arguing that the SEC exceeded its statutory authority in adopting it.The case was heard in the United States Court of Appeals for the Fifth Circuit. The petitioners argued that the SEC had overstepped its authority under the Investment Advisers Act of 1940 and the Dodd-Frank Act. They contended that the rule imposed requirements that were not authorized by these statutes and that the SEC had failed to adequately consider the rule's impact on efficiency, competition, and capital formation.The SEC, on the other hand, argued that it had the authority to adopt the rule under sections 206(4) and 211(h) of the Advisers Act. It contended that these provisions authorized it to define and prescribe means to prevent fraudulent, deceptive, or manipulative acts by investment advisers.The Fifth Circuit sided with the petitioners, holding that the SEC had exceeded its statutory authority in adopting the rule. The court found that the rule was not authorized by the relevant provisions of the Advisers Act and that the SEC had failed to establish a close nexus between the rule and the prevention of fraud or deception. As a result, the court vacated the rule. View "NA of Private Fund Managers v. SEC" on Justia Law

The case involves Disability Rights Texas (DRTx), an advocacy organization for individuals with mental illness, and Houston Behavioral Healthcare Hospital (Houston Behavioral). DRTx sought to compel Houston Behavioral to disclose video footage related to the involuntary confinement of its client, G.S., who alleged abuse during his detention at the hospital. G.S. had signed a waiver allowing DRTx to access his records. Houston Behavioral initially cooperated with DRTx's requests for information but refused to provide the requested video footage, citing confidentiality regulations related to substance use disorder treatment.The United States District Court for the Southern District of Texas granted summary judgment in favor of DRTx and issued an injunction, compelling Houston Behavioral to disclose the video footage. Houston Behavioral appealed this decision.The United States Court of Appeals for the Fifth Circuit affirmed the lower court's decision. The court found that the Protection and Advocacy for Individuals with Mental Illness Act (PAIMI Act) grants broad investigatory powers to organizations like DRTx, including access to "all records of any individual." The court held that the video footage requested by DRTx falls within the definition of "records" under the PAIMI Act. The court also found that the Health Insurance Portability and Accountability Act (HIPAA) does not bar the disclosure of such records, as the required-by-law exception in HIPAA permits disclosure when another law, such as the PAIMI Act, requires it. The court concluded that Houston Behavioral's refusal to provide the video footage violated the PAIMI Act. View "Disability Rights Texas v. Hollis" on Justia Law

In this case, a Delaware statutory trust, NB Taylor Bend, DST (Taylor Bend), borrowed $13 million from Prudential Mortgage Capital Company, LLC (Prudential) to acquire property in Lafayette County, Mississippi. Patrick and Brian Nelson, who were guarantors of the loan, signed an Indemnity and Guaranty Agreement (the Guaranty) in December 2014, personally guaranteeing the loan. After the loan documents were executed, Prudential assigned the loan to Liberty Island Group I, LLC (Liberty), which in turn assigned the loan to North American Savings Bank, FSB (NASB). By May 2020, Taylor Bend struggled to find tenants for the property due to the COVID-19 pandemic and informed NASB of their financial problems. In May 2021, NASB declared Taylor Bend to be in default after the borrower continually failed to make timely loan payments. NASB then filed an action against the Nelsons in the United States District Court for the Northern District of Mississippi, asserting claims for breach of the Guaranty, for recovery of the loan balance, and for declaratory judgment.The district court entered partial summary judgment for NASB, holding the Nelsons “breached the [G]uaranty and thus owe[d] to [NASB] the amount remaining due on the subject loan.” The court determined that the Guaranty was “freely assignable” and that Prudential adequately assigned all of its rights and interests to Liberty, which in turn assigned all of its rights and interests to NASB, including those conferred by the Guaranty. The court also concluded that the defenses raised by the Nelsons were “unavailable given the borrower’s absence from this litigation.” The court also granted Brian’s motion for summary judgment against Patrick, ruling that the indemnity agreement between the brothers was valid and binding and that Patrick was contractually required to indemnify Brian for “any and all obligations arising out of or relating to this litigation.”The United States Court of Appeals for the Fifth Circuit affirmed the district court's decision. The court held that the Guaranty was properly assigned from Prudential to Liberty and from Liberty to NASB. NASB could therefore properly bring its claims for breach of guaranty and declaratory judgment against the Nelsons to recover the loan deficiency. Moreover, under Mississippi law, Patrick may not interpose equitable defenses that were available only to Taylor Bend to defeat his liability under the Guaranty. The court also held that the deficiency judgment awarded to NASB pursuant to the Guaranty need not be reduced by the third-party sale of the Apartments to Kirkland. NASB had no duty to mitigate its damages under either Mississippi law or the terms of the Guaranty. View "North American Savings Bank v. Nelson" on Justia Law

The Association of American Physicians and Surgeons Educational Foundation (AAPS) alleged that the American Board of Internal Medicine, the American Board of Obstetrics & Gynecology, the American Board of Family Medicine, and the Secretary of the U.S. Department of Homeland Security coordinated to censor and chill the speech of physicians who criticized positions taken by Dr. Anthony Fauci, lockdowns, mask mandates, Covid vaccination, and abortion. The AAPS claimed that these entities threatened to strip certification from physicians who expressed such views, which harmed the AAPS.The District Court dismissed all of AAPS's claims with prejudice, stating that it lacked standing to assert its claims against the medical boards and that the Department of Homeland Security had mooted claims against it by dissolving the Disinformation Governance Board, which AAPS alleged was responsible for censorship. The District Court also denied AAPS the ability to amend its complaint.The United States Court of Appeals for the Fifth Circuit reversed the District Court's decision, finding that AAPS had provided sufficient allegations to support standing. The Court of Appeals also found that the District Court had erred in denying AAPS an opportunity to amend its complaint. However, the Court of Appeals agreed with the District Court that AAPS's claims against the Department of Homeland Security were moot due to the dissolution of the Disinformation Governance Board. The Court of Appeals remanded the case for further proceedings. View "AAPS v. ABIM" on Justia Law

In 2017, Terry Bevill, a captain of the Quitman Police Department, signed an affidavit supporting a motion to transfer venue in a criminal case against his friend and former colleague, David McGee. Bevill's affidavit alleged potential bias in the local justice system, including personal relationships between the sheriff, the district attorney, and the presiding judge. Following an investigation, Quitman Mayor David Dobbs terminated Bevill's employment, concluding that Bevill's affidavit violated two police department policies. Bevill filed a lawsuit claiming First Amendment retaliation and conspiracy to retaliate against him for his speech.Previously, the district court denied motions to dismiss the case filed by Sheriff Castloo, District Attorney Wheeler, and Judge Fletcher, who claimed qualified immunity. The United States Court of Appeals for the Fifth Circuit affirmed this decision. Now, the same court is reviewing the district court's denial of the defendants' motions for summary judgment.The court affirmed the district court's decision. It found that Bevill spoke as a citizen on a matter of public concern when he submitted his affidavit. The court also held that Bevill's interest in his speech outweighed the government's interest in the efficient provision of public services. The court concluded that Bevill's constitutional rights were clearly established, and the defendants were not entitled to qualified immunity. The court also held that District Attorney Wheeler was not entitled to prosecutorial immunity. The court noted that it lacked jurisdiction to review the district court's finding that there was sufficient evidence for a jury to infer that the defendants conspired to terminate Bevill's employment in retaliation for his speech. View "Bevill v. Wheeler" on Justia Law

The case revolves around Gene Rudolph, who pleaded guilty to conspiracy to distribute significant quantities of cocaine. Prior to sentencing, Rudolph objected to the Presentence Investigation Report (PSR), particularly the application of various enhancements and his designation as a "career offender." The latter significantly increased his offense level and advisory guideline range for incarceration. Rudolph's career offender status was based on his past convictions, including a 1996 drug offense. He argued that this conviction should not have been considered as it occurred more than fifteen years before the current offense, making it too stale for the career offender guideline.The district court, however, determined that the PSR was accurate and that Rudolph's parole on the 1996 drug offense was revoked in 2004, which was within fifteen years of the commencement of the current offense. Consequently, Rudolph was sentenced to 262 months of incarceration.Upon appeal, the United States Court of Appeals for the Fifth Circuit found that the government failed to provide an adequate evidentiary basis to support its claim that Rudolph's parole was revoked in 2004 for the 1996 drug conviction. The court ruled that the district court's adoption of this fact and application of the career offender enhancement was clear error. The court also rejected Rudolph's argument that his current offense did not qualify as a "controlled substance offense" under the sentencing guidelines. The court vacated Rudolph's sentence and remanded the case to the district court for resentencing. View "United States v. Rudolph" on Justia Law

Several Louisiana coastal parishes, joined by the Louisiana Attorney General and the Louisiana Secretary of Natural Resources, filed lawsuits against various oil and gas companies, alleging violations of Louisiana’s State and Local Coastal Resources Management Act of 1978. The companies removed these cases to federal court, asserting that they satisfy the requirements of the federal officer removal statute due to their refining contracts with the government during World War II. The district courts granted the parishes’ motions to remand these cases to state court, concluding that the oil companies did not meet their burden of establishing federal jurisdiction.The oil companies appealed the district courts' decisions. The United States Court of Appeals for the Fifth Circuit affirmed the district courts’ orders remanding these cases to state court. The court concluded that the oil companies failed to satisfy the “acting under” requirement of the federal officer removal statute, as their compliance with federal regulations or cooperation with federal agencies was insufficient to bring a private action within the statute. The court also found that the oil companies failed to establish that the conduct challenged in the parishes’ lawsuits was “connected or associated with” acts the companies had taken under color of federal office. View "Plaquemines Parish v. BP America Production Co." on Justia Law

The case involves a dispute over the ownership of a painting by Bernardo Bellotto, which was sold under duress by Max Emden during the Nazi persecution of Jews prior to World War II. The painting was later found in a salt mine in Austria by the Monuments Men, a group of U.S. military officers tasked with facilitating the restitution of art stolen by the Nazis. The painting was mistakenly sent to the Netherlands to fulfill a claim by a gallery in Amsterdam, but the painting was actually a replica painted by Bellotto himself, not the gallery's version. The painting was eventually sent to the United States and is currently housed in the Museum of Fine Arts in Houston. The heirs of Max Emden, the original owner, are seeking to recover the painting.The case was initially heard in the United States District Court for the Southern District of Texas, which dismissed the claim due to the act of state doctrine. This doctrine prohibits U.S. courts from questioning the actions of a foreign government, in this case, the Dutch government's decision to send the painting to the United States.The case was then appealed to the United States Court of Appeals for the Fifth Circuit. The court affirmed the lower court's decision, agreeing that the act of state doctrine applies in this case. The court held that any evaluation of the painting's ownership would require questioning the Dutch government's actions, which is prohibited by the act of state doctrine. The court also rejected the plaintiffs' arguments that the doctrine should not apply because the Dutch government's actions were not official, there would be no negative impact on foreign relations, and the act was not solely within the Netherlands. The court concluded that the act of state doctrine bars U.S. courts from questioning the validity of the Dutch government's actions. View "Emden v. Museum of Fine Arts" on Justia Law