“What does Judge X think about my issue?”  If Judge X has served on the Fifth Circuit for some time, his or her votes in two cases can provide good insight: (1) the denial of en banc rehearing in Huss v. Gayden, 585 F.2d 823 (5th Cir. 2009), a difficult Daubert case, and (2) the en banc opinion of In re Volkswagen,  545 F.3d 304 (5th Cir. 2008), which granted mandamus relief for the denial of a 1404 venue transfer motion from the Eastern District of Texas. A third case has now joined that list — the recent 7-8 vote to deny en banc rehearing for In re Radmax, 730 F.3d 285 (5th Cir. 2013).  The Radmax panel granted mandamus relief to compel an intra-district transfer under section 1404.  Judge Higginson, who dissented from the panel, also dissented from the en banc vote, pinpointing the issue as whether the ruling “propounds appellate mandamus power over district judges which the Supreme Court has said we do not have.”  The votes in Huss, Volkswagen, and Radmax signal much about a judge’s philosophy as to the power and role of a district judge.

Marceaux v. Lafayette City-Parish Consolidated Gov’t was a section 1983 case brought by former and current police officers against leaders of the Lafayette Police Department.  No. 13-30332 (Sept. 30, 2013).  “[T]he Officers communicated with the media concerning the case and maintained a website, www.realcopsvcraft.com (the “Website”), which contained: an image of the Lafayette Police Chief, a party in this suit; excerpts of critical statements made in the media concerning the Lafayette PD Defendants; certain voice recordings of conversations between the Officers and members of the Lafayette Police Department; and other accounts of the Lafayette PD Defendants’ alleged failings.” Acknowledging both the district court’s discretion to issue gag orders about such communications, and the powerful First Amendment protection against prior restraints, the Fifth Circuit found an abuse of discretion in ordering the shutdown of the entire website.  It remanded for consideration of a more narrowly-tailored order.

Employer sought to enforce two arbitration agreements in an employee handbook, which also gave Employer the right to unilaterally “supersede, modify, or eliminate existing policies.”  Scuderio v. Radio One of Texas II, LLC, No. 13-20114 (Oct. 24, 2013, unpublished).  Applying In re 24R, Inc., 324 S.W.3d 564 (Tex. 2010), the Fifth Circuit noted a distinction between an arbitration clause that is in a separate instrument from a handbook with such a provision, and a clause that is part of the handbook.  Here, “because the arbitration provision is in the handbook that contains the language allowing the employer to unilaterally revise the handbook, the agreement to arbitrate is illusory and unenforceable.”  See also Carey v. 24 Hour Fitness, 669 F.3d 202 (5th Cir. 2012) (finding another arbitration provision illusory in an employment setting).

The plaintiff in Delahoussaye v. Performance Energy Services LLC suffered back injuries while working on a drilling platform when a handrail fell on him.  No. 12-31222 (Oct. 24, 2013).  The district awarded general damages of $200,000, noting that the plaintiff had exaggerated his complaints of pain and was able to return to work.  The award was reviewed for clear error.  The Fifth Circuit reviewed prior awards in comparable cases and concluded that $200,000 was excessive in light of the district court’s other fact findings. Reviewing precedent that established a “maximum recovery” guideline based on 133% of the highest previous recovery for a similar injury, the Court remitted the damages to $86,450 (133 percent of $65,000, the highest comparable recovery found by the Court).  The plaintiff could accept the remitted award or have a new trial on damages.

The machinery of justice needs fuel to function.  An eloquent letter by the Judicial Conference of the United States summarizes today’s serious situation about the funding of the federal courts.  Please speak out.

A builder obtained a 6-figure judgment against an architect, for cost overruns and lost profits, resulting from the architect’s negligence.  Garrison Realty LP v. Fouse Architecture & Interiors, PC, No. 12-40764 (Oct. 21, 2013, unpublished).  The jury awarded distinct sums for negligence and negligent misrepresentation.  The Fifth Circuit found that the causes of action were duplicative in this context and reversed as to the inclusion of the smaller award in the final judgment. The Court also held that the defendant had waived an argument for a partial offset as a result of a prior lawsuit, finding that offset had not been pleaded as a defense, and that the plaintiff was prejudiced because it could have changed its trial proof had the issue been raised earlier.  (On the pleading issue, the Court noted that the defendant had alleged offset, but only claimed it was a bar “in whole” rather than “in whole or in part.”)

The plaintiff in a personal injury case was found to be judicially estopped from asserting the claim because it was not properly disclosed in her personal bankruptcy, even though it arose post-petition.  Flugence v. Axis Surplus Ins. Co., No. 13-30073 (Oct. 4, 2013).  The trustee, however, could pursue the claim and its counsel could recover professional fees. Accordingly, the Court declined to declare that the trustee’s recovery was capped at the amount owing to creditors.  (applying Reed v. City of Arlington, 650 F.3d 571 (5th Cir. 2011) (en banc)).

In one of the many unpublished cases dismissing “split-the-note” cases after Martins v. BAC Home Loans Servicing, LP, 722 F.3d 249 (5th Cir. 2013), the Fifth Circuit addressed a foreclosure sale that had taken place while a TRO purported to stop it.  Hall v. BAC Home Loans Servicing, No. 12-41023 (Oct. 7, 2013, unpublished).  Because the TRO did not state why it was granted without notice, the Court concluded that it “did not meet the requirements of Texas Rule of Civil Procedure 680,” making it “void under Texas law” and “a mere nullity.”  Accordingly, it could not support a wrongful foreclosure claim.

The plaintiff in Bradberry v. Jefferson County, Texas alleged that he was terminated from his job as a county corrections officer, in violation of federal law, because he was called to service in the Army Reserve during Hurricane Ike.  No. 12-41040 (Oct. 17, 2013).  A key issue was whether a county administrative proceeding about his termination had collateral estoppel effect on his later federal lawsuit.  The Fifth Circuit, noting that administrative proceedings can create collateral estoppel if state law would allow it, held that the questions were different and no estoppel arose: “We conclude that a finding that Bradberry was discharged due to a disagreement about military service is not the equivalent of a finding that the County was motivated by his military status to discharge him.” While analogical reasoning from this fact-specific holding may pose challenges, it still provides a clearly-stated example of when issues become “identical” for purposes of issue preclusion.

Washington Mutual (“WaMu”) failed; Chase took over its mortgage operations from the FDIC.  In the meantime, borrower Dixon (after receiving notice from Chase that it was replacing WaMu as mortgagee and servicer) obtained a default judgment in state court against WaMu for $2.8 million and a declaration that all liens were cancelled.  A year later, Chase foreclosed on the property and obtained title at a foreclosure sale.  Chase sued in federal court to quiet the cloud on title created by the recordation of the default judgment.  JP Morgan Chase Bank NA v. Dixon, No. 12-40590 (Oct. 7, 2013, unpublished).  The district court granted summary judgment to Chase.  Dixon argued that this ruling violated the Rooker/Feldman doctrine about federal review of state court judgments.  The Fifth Circuit disagreed, noting that the federal ruling did not technically “nullify” the state court judgment, and that Chase was not a party to the state proceedings and thus Rooker/Feldman was not implicated.

Devon Enterprises was not re-approved as a charter bus operator for the Arlington schools after the 2010 bid process.  Devon Enterprises v. Arlington ISD, No. 13-10028 (Oct. 8, 2013, unpublished).  Devon argued that it was rejected solely because of its bankruptcy filing in violation of federal law; in response, the district cited safety issues and insurance problems.  An email by the superintendent said “[Alliance] was the company that [AISD] did not award a bid to for charter bus services because they are currently in bankruptcy.”  Calling this email “some, albeit weak, evidence” that the filing was the sole reason for the decision, the Fifth Circuit reversed a summary judgment for the school district.

Moore sued PPG Industries and several local parties for injuries at a chemical complex; the defendants removed, arguing fraudulent joinder.  After some jurisdictional discovery, Moore sought to add three more local parties, and the district court denied him leave to do so.  Moore v. Manns, No. 12-31265 (Oct. 8, 2013). The Fifth Circuit affirmed, first reminding; “If after removal the plaintiff seeks to join additional defendants whose joinder would destroy subject matter jurisdiction, the court may deny joinder, or permit joinder and remand the action to the State court”; accordingly, a district court should review such a proposed amendment “more closely than an ordinary amendment.”  Factors include the extent to which the amendment is solely for jurisdictional purposes, whether plaintiff was dilatory, and potential harm to plaintiff of not allowing the amendment.  Here, the Court agreed that the “general responsibilit[y]” for safety under which the new parties were sued did not trigger personal fault under Louisiana law, making the amendment tactical and impermissible.

Auto Parts Manufacturing Mississippi hired Noatex to build a manufacturing facility.  Noatex subcontracted with King Construction.  Noatex then questioned some bills sent by King. King responded with a “Lien and Stop Notice” that trapped roughly $260,000.  Noatex v. King Construction, Nos. 12-60385 & 12-60586 (Oct. 10, 2013).  The Fifth Circuit affirmed the district court’s conclusion that the Mississippi lien statute was unconstitutional, concluding: “The Stop Notice statute is profound in its lack of procedural safeguards.  It provides for no pre-deprivation notice or hearing of any kind . . . The statute even fails to require any affidavit or attestation setting out the facts of the dispute and the legal rationale for the attachment.”  The court rejected an argument that post-attachment penalties for a false filing could save the statute, as well as an argument based on the importance of the interest in “promotion of the health of the construction industry,” noting that no governmental official was involved in the attachment process.

In a straightforward analysis of “conflict preemption,” the Fifth Circuit agreed that the Federal Power Act (the enabling statute for FERC) “preempts property damage claims under state law where the claim alleges negligence for failing to act in a manner FERC expressly declined to mandate while operating a FERC-licensed project.”  Simmons v. Sabine River Authority, No. 12-30494 (Oct. 9, 2013).  Here, plaintiffs claimed damages from flooding after spillway gates along the Sabine River were opened in late 2009; the Court concluded that the claims “infringe on FERC’s operational control” because “FERC, not state tort law, must set the appropriate duty of care for dam operators.”

In Serna v. Law Office of Joseph Onwuteaka, P.C., the plaintiff alleged that a debt collector had sued him in an impermissible venue under the FDCPA .  No. 12-20529 (Oct. 7, 2013). The defendants obtained summary judgment on limitations; the question was whether the offending act under the FDCPA — to “bring such action” — was filing of the suit or service. The Fifth Circuit found that the term “bring” is ambiguous in this context, which justifies consideration of the statute’s history and purpose.  It then concluded that “the FDCPA’s remedial nature compels the conclusion that a violation includes both filing and notice,” and reversed.  A dissent argued that the term was not ambiguous, since the term “brought” refers only to filing in another provision of the statute.

In Vinewood Capital LLC v. Dar Al-Maal Al-Islami Trust, “[t]he only evidence offered by Vinewood in support of the alleged oral contract between Vinewood and DMI for DMI to invest $100 million in real estate [was] Conrad’s deposition testimony and affidavit.”  No. 12-11103 (Oct. 8, 2013, unpublished).  The Fifth Circuit reminded: “[A] party’s uncorroborated self-serving testimony cannot prevent summary judgment, particularly if the overwhelming documentary evidence supports the opposite scenario.” (citing Vais Arms, Inc. v. Vais, 383 F.3d 287, 294 (5th Cir. 2004)).Therefore, “[a]s the district court concluded, Conrad’s self-serving testimony is belied by the parties’ contemporaneous written communications and written agreements and is therefore insufficient to create an issue of fact.”

The district court awarded attorneys fees for a lawsuit filed in breach of a release, and the Fifth Circuit affirmed.  Dallas Gas Partners v. Prospect Energy Corp., No. 12-20496 (Oct. 7, 2013).  Among other arguments, appellants contended that even if they were bound by the release, they did not breach it because they were not named plaintiffs in the offending action.  Admitting that they funded the lawsuit, and directed the plaintiff entity to bring the suit, they argued that those actions did not violate the agreement not to “institute, maintain or prosecute any action . . . ”  The Court found that “maintain” meant financial support.

Attorneys filed fee applications in a bankruptcy and the debtor responded with tort counterclaims.  Frazin v. Haynes and Boone, No. 11-10403 (Oct. 1, 2013).  The bankruptcy court entered judgment for the attorneys.  The Fifth Circuit found a lack of jurisdiction over the DTPA counterclaim and remanded.  It reasoned that Stern v. Marshall, 131 S. Ct. 2594 (2011), had overruled prior circuit precedent saying that bankruptcy courts could enter final judgments in all “core” proceedings.  Applying Stern to these claims, the Court reasoned (1) the malpractice claim was intertwined with the fee application, (2) the fiduciary duty action was as well, as it sought fee forfeiture, but (3) “it was not necessary to decide the DTPA claim to rule on the Attorneys’ fee applications” (including whether the claim was an impermissible “fracturing” of a professional negligence claim under Texas law)  The court noted that the district court may have jurisdiction to enter final judgment on the claim.  A dissent would not remand “because no harm is done, at least in this case, and the district court will no doubt simply dismiss whatever has been remanded.”

John Doe, a 13-year-old member of the Choctaw Indian tribe, had an internship at a Dollar General store on the Mississippi Choctaw reservation.  He was sexually molested in the store and sued the company for damages in tribal court.  Dolgencorp Inc. v. The Mississippi Band of Choctaw Indians, No. 12-060668 (Oct. 3, 2013).  After losing jurisdictional challenges in the tribal system, the company sued in federal court to enjoin the prosecution of the case.  The Fifth Circuit affirmed dismissal in favor of Choctaw jurisdiction. Reviewing the Supreme Court authority in the area, it concluded: “[T]he ability to regulate the working conditions (particularly as pertains to health and safety) of tribe members employed on reservation land is plainly central to the tribe’s power of self-government.” (discussing Plains Commerce Bank v. Long Family Land & Cattle Co., 554 U.S. 316 (2008) and Montana v. United States, 450 U.S. 544 (1981)).  A strongly-worded dissent criticized “[t]he majority’s alarming and unprecedented holding,” arguing that it “profoundly upsets the careful balance that the Supreme Court has struck” in the area. Over another dissent, the full Court denied en banc review in 2014.

The district court handling the Deepwater Horizon litigation rebuffed BP’s complaints that the agreed-upon claims processing formula was not working correctly.  Lake Eugenie Land & Development v. BP Exploration & Production, No. 13-30315 (Oct. 2, 2013).  A fractured opinion from the Fifth Circuit reversed in substantial part.  It required remand for further development of the record on how the agreement was intended to handle several accounting issues about claimed losses.  The Court then imposed a “tailored stay” on further payments to “allow[] the time necessary for deliberate reconsideration of these significant issues on remand.”  Judge Clement wrote the plurality, which Judge Southwick joined on the foregoing grounds.  Her opinion went on to note that, for standing reasons, a court lacked jurisdiction to administer a settlement “that included [class] members that had not sustained losses at all, or had sustained losses unrelated to the oil spill . . . .” Judge Dennis dissented as to the reasons for remand and disagreed with the standing analysis.

In Meyers v. Textron Inc., the Fifth Circuit affirmed the Rule 12 dismissal of a complaint on res judicata grounds.  No.13-10023 (Oct. 2, 2013, unpublished).  .Noting that res judicata is ordinarily an affirmative defense, the Court reminded: “When all relevant facts are shown by the court’s own records, of which the court takes notice, the defense [of res
judicata] may be upheld on a Rule 12(b)(6) motion without requiring an answer.” On the merits, the Court found no dispute that the plaintiffs in two cases were in privity given the control one had over the other.

While nominally about a limited issue of workers compensation law,  Austin v. Kroger Texas LP analyzes basic issues of an “Erie guess,” Texas premises liability law, and the types of negligence claims available in Texas.  No. 12-10772 (Sept. 27, 2013).  Austin, a Kroger employee, slipped while cleaning an oily liquid with a mop.  Contrary to store policy, a product called “Spill Magic” was not available to him that day.   After a thorough discussion of the interplay between the common law of premises liability and the Texas workers compensation statutes (Kroger being a non-subscriber), the Fifth Circuit reversed a summary judgment for Kroger that was based on Austin’s subjective awareness of the spill.  “Section 406.033(a) of the Texas Labor Code takes the employee’s own negligence off of the table for a non-subscriber like Kroger . . . ”  The Court went on to find fact issues about Kroger’s negligence in not having Spill Magic available, and about Kroger’s knowledge of the spill.  The Court affirmed dismissal of the gross negligence claim, and in the remand, asked the district court to consider the specific type of negligence claim that Austin asserted under Texas law.