Five Tips for Fifth Circuit Business Cases in 2013

The Fifth Circuit’s 2012 business litigation opinions suggest these five tips for the New Year:

1.  Plead key details.   While not removing the limits on Fed. R. Civ. P. 9(b), the Court has reminded twice of the importance of “what,” “how,” and “when” in pleading under Twombly and Iqbal.  It also reversed a Rule 12 dismissal in a contract case because the plaintiff adequately pleaded an industry custom about the relevant terms.

2.  Plead reasonably.  The Federal Circuit, applying Fifth Circuit law, reversed the denial of Rule 11 sanctions for what it saw as an objectively unreasonable construction of a patent.

3.  Stretch the long arm carefully.  Applying recent Supreme Court authority, the Fifth Circuit found no personal jurisdiction over cases about an “off-the-shelf” software contract, a distributorship arrangement based outside the forum state, and an alleged corporate “alter ego” situation.

4.  Watch the eight corners.   During 2012, the Court reversed once, and then again, to reject exceptions to Texas’s “eight corners” rule about insurance coverage, but also reversed to allow a mistake claim to proceed despite that rule.

5.  Don’t count on mandamus.  After granting mandamus in a high-profile venue dispute in 2008, the Court has since declined to grant the writ as to the wrongful denial of a remand motion and an alleged error about a forum selection clause.

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