The Fifth Circuit reversed a defense summary judgment in a products case in Certain Underwiters at Lloyd’s v. Axon Pressure Prods., Inc., noting:

• Procedurally, a lack of explanation as to key Daubert rulings and related elements of the plaintiff’s claim, characterizing them as “pithy to the point of being incomplete.”
• Substantively, a fact issue on causation, given conflicting testimony on (a) the handling of the relevant piece of equipment, (b) the reasons for material continuing to flow through that equipment at the time of the accident.

No. 18-20453 (Feb. 21, 2020).

The Committee for a Qualified Judiciary has published its list of Dallas-area judicial candidates found qualified.

To the right, Elvis sings “Return to Sender.” Similarly, in Rajet Aeroservicios v. Cervantes, the Fifth Circuit reminded: “‘The failure to include a return[-]jurisdiction
clause in an [FNC] dismissal constitutes a per se abuse of discretion.” . . . This is because, as our court has repeatedly made clear, ‘courts must take measures, as part of their dismissals in  [FNC] cases, to ensure that defendants will not attempt to evade the jurisdiction of the foreign courts.’ Notably, ‘[s]uch measures often include agreements
between the parties to litigate in another forum, to submit to service of process
in that jurisdiction, to waive the assertion of any limitations defenses, to agree
to discovery, and to agree to the enforceability of the foreign judgment.’ A return-jurisdiction clause assists in preventing defendants from circumventing these measures and ensures plaintiffs have the opportunity to proceed with the action in one of the forums.” No. 19-20354 (Feb. 3, 2020) (unpublished) (citations omitted, emphasis added).

Resolution of the tortious-interference claim in Whitney Bank v. SMI Companies Global, Inc. turned on whether the defendant’s profit motive could establish “actual malice” as required by Louisiana law. To the panel majority:

There is no evidence that Whitney was driven by anything other than profit in its collection efforts. Moreover, the express terms of the contract allowed Whitney to recover from SMI’s customers because both loans were secured by SMI’s accounts receivable. While it may have been more prudent and logical for Whitney to involve SMI in its collection efforts, those efforts, however brusque, served to protect the bank’s legitimate interests—collecting on the defaulted loans.

(citations omitted, emphasis added). The dissent, however:

Often this requirement [of “actual malice”] is insurmountable in the business context because of the “appropriate” motivation of profits. But I disagree with the notion that someone in a corporation who is seeking to collect money from another can never have actual malice or ill will towards that other. Corporations are run by humans, after all. . . . The magistrate judge’s decision rested in part on its determination that Whitney’s employees lacked credibility, and we do not second-guess credibility determinations.

No. 18-31189 (Feb. 3, 2020) (emphais added). (Louisiana’s actual-malice requirement for this tort is uniquely demanding, so this discussion may be less relevant in other jurisdictions.)

In Vizaline, LLC v. Tracy, the Fifth Circuit formally implemented NIFLA v. Becerra, 138 S.Ct. 2361 (2018), in the context of Mississippi’s licensing of surveyors: “The Supreme Court has recently disavowed the notion that occupational licensing regulations are exempt from First Amendment scrutiny. In overturning the “professional speech” doctrine deployed by some circuits, including ours, the Court rejected any theory of the First Amendment that ‘gives the States unfettered power to reduce a group’s First Amendment rights by simply imposing a licensing requirement.’ The district court’s ruling in this case—that Mississippi’s licensing requirements for surveyors do not trigger any First Amendment scrutiny—was inconsistent with NIFLA. We therefore reverse and remand for further proceedings.” No. 19-60053 (Feb. 14, 2020) (citations omitted, emphasis added).

Gonzales cited two Texas Supreme Court cases, decided after a summary judgment against her, holding that an insurer’s payment of an appraisal award does not preclude a Texas Prompt Payment of Claims Act (“TPPCA”) claim. The Fifth Circuit found that she failed to preserve this argument in the district court. The Court noted that “a change in law . . . does not permit a party to raise an entirely new argument that could have been articulated below”–a rule that applies when a party “could have made the same ‘general argument’ to the district court, but had not done so.” As for the state of the law at the time of the summary-judgment briefing, the Court observed:

We recognize that several courts, including our own, had previously concluded a TPPCA claim was extinguished as a matter of law after the payment of an appraisal award. But the Supreme Court of Texas granted review in [the two relevant cases] on January 18, 2019, seven days after Allstate moved for summary judgment and thirteen days before Gonzales filed her response to the motion. This fact undermines her assertion here that she “could not have made a good faith argument in the trial court that payment of the appraisal award did not preclude her from recovering under the TPPCA as a matter of law.”

Gonzales v. Allstate Vehicle & Property Ins. Co., No. 19-40250 (Feb. 11, 2020) (emphasis added, footnote omitted).

“[T]he only non-moot challenges to the injunction concern its forward-looking terms, which do not stay any ongoing state-court proceedings. See 28 U.S.C. § 2283
(absent specific exceptions, prohibiting federal courts from ‘grant[ing] an injunction to stay proceedings in a State court’); see also Dombrowski v. Pfister, 380 U.S. 479, 485 n.2 (1965) (§ 2283 bars only ‘stays of suits already instituted’ but does not ‘preclude injunctions against the institution of state court proceedings’ (citation omitted)).” Hill v. Hunt, No. 18-11633 (revised March 13, 2020).

In re Darden joins the line of cases in which the Fifth Circuit denied a mandamus petition while offering guidance on the issue presented. Darden sought relief from the trial court’s proposed jury charge on a key issue in a wrongful-death case, and the Court held:

Darden has other adequate means to attain the relief he desires. We are satisfied that on these facts, a writ of mandamus would be inappropriate. Nevertheless, we suggest that the following additional question in the verdict form, one for each officer, upon which the jury’s other findings would not be conditioned, would clearly comply with this court’s prior opinion and possibly avoid another appeal regarding these instructions after a verdict.

QUESTION NO. [#]

Do you find from a preponderance of the evidence that [officer’s name] knew or should have known of the existence and extent of Jermaine Darden’s preexisting conditions?

No. 20-10065 (Feb. 7, 2020).

A not-unusual series of events involving a settlement agreement led to a practice tip in Defense Distributed v. U.S. Dep’t of State, No.18-05911 (Jan. 21, 2020):

• Plaintiffs sued several government entities about their right to publish online plans for the “Liberator” (right) a firearm that could be made with a 3-D printer;
• That lawsuit settled, favorably for the publisher;
• The settling parties filed a Rule 41(a)(1)(A)(ii) stipulation of dismissal;
• A few days later, the district court (purported to) enter a final judgment;
• Various states brought a new lawsuit in another federal court to enjoin the settlement; leading the original plaintiffs to try and reopen the case under Fed. R. Civ. P. 59(e).

The Fifth Circuit found that the stipulation divested the district court of jurisdiction, dooming the request to reopen. The Court suggested: “If the parties had wanted to, they could have asked the district court to retain jurisdiction–for example, to oversee enforcement of a settlement agreement.” (citations omitted).

The Texas Supreme Court’s recent opinion in JP Morgan Chase v. Orca Assets, 546 S.W.3d 648 (Tex. 2018) has significantly influenced commercial litigation, particularly with its focus on “red flags” about a questionable transaction. In Universal Truckload, Inc. v. Dalton Logistics, Inc., Ni. 17-20725 (Jan. 3, 2020), a promissory estoppel case, the Fifth Circuit observed: “[T[his case differs from JPMorgan in at least three crucial ways. First, the letter of intent at issue in JPMorgan was a binding contract signed by both parties. The [Indication of Interest (“IOI”] that Universal Truckload sent Dalton is expressly nonbinding. Second, the letter of intent in JPMorgan included a clause disclaiming any oral agreements. Universal Truckload’s IOI does not. And third, the letter of intent in JPMorgan directly contradicted the oral promise, and Universal Truckload’s IOI does not. The Supreme Court of Texas explained in JPMorgan, ‘there is no direct contradiction if a reasonable person can read the writing and still plausibly claim to believe the [oral] representation.’ The conditions laid out in the IOI explain what would need to happen if Universal Truckload was to enter a contract to purchase Dalton. But the jury did not find in favor of Dalton on a contract theory. Dalton succeeded on a promissory estoppel theory, which requires the absence of a contract.”

A fatal injury at the L’Auberge Casino in Lake Charles, Louisiana, led to litigation in Texas against the casino’s owner. The plaintiffs asserted general personal jurisdiction based on the casino’s substantial marketing efforts directed toward Texas. The Fifth Circuit acknowledged “a handful of . . . district court cases finding general jurisdiction against non-resident casinos for their localized marketing efforts,” but found that recent Supreme Court opinions about general jurisdiction meant that “local advertising, as a standalone factor, does not meet ‘the demanding nature of the standard for general personal jurisdiction over a corporation.'” Frank v. P N K (Lake Charles) LLC, No. 18-31060 (Jan. 21, 2020) (applying, inter alia, Daimler AG v. Bauman, 571 U.S. 117 (2014)).

I spoke at the State Bar’s “Litigation Update” last Friday to give a Supreme Court and Fifth Circuit update; here is my PowerPoint from that presentation. It covers SCOTUS and CTA5 cases of general interest to business litigators since the last Litigation Update seminar in January 2019.