In Rhone v. City of Texas City, the Fifth Circuit denied a request for emergency relief without prejudice, first describing the controlling rules:

[Fed. R. App. P. ] 8(a)(1) states that “[a] party must ordinarily move first in the district court for … (A) a stay of the judgment or order of a district court pending appeal.” Rule 8(a)(2) provides, however that “[a] motion for the relief mentioned in Rule 8(a)(1) may be made to the court of appeals or to one of its judges.” That provision is subject to a requirement that “[t]he motion must: (i) show that moving first in the district court would be impracticable; or (ii) state that, a motion having been made, the district court denied the motion or failed to afford the relief requested and state any reasons given by the district court for its action.” Rule 8(a)(2)(A).

Applying those rules, the Court concluded:

In this case, Rhone has moved for relief from judgment in the district court and no ruling has been made. As such, this motion is premature. Therefore, the motion before us is denied without prejudice. Should the district court deny Rhone’s pending motion, Rhone may revive the motion in this Court.

No. 22-40551 (Sept. 19, 2022, unpublished).

The district court in Williams v. Biomedical Research Foundation imposed a sanction for what it saw as an “impertinent” email to its law clerk. The Fifth Circuit reversed, noting: “The district judge signaled his intent to sanction Plante-Northington for the first time at an oral hearing on an unrelated matter. He then imposed the sanctions just minutes later at that hearing. Plante-Northington was allowed to utter only a few sentences in her defense before she was cut off. More importantly, she was given no advance notice sufficient for preparing a written or oral submission in response to the contemplated sanctions.” No. 22-30064 (Aug. 24, 2022) (unpublished).

Professor Steve Vladeck recently filed a provocative amicus brief about the State of Texas’s forum-selection practices in public law / constitutional cases.

The Fifth Circuit is soliciting comment on a potential change to local rule 47.5.4:

In BRFHH Shreveport, LLC v. Willis-Knighton Medical Center, the Fifth Circuit affirmed the dismissal of antitrust claims when:

• As to the plaintiff’s theory of a “threat-and-accession” agreement in violation of section 1 of the Sherman Act, “[t]he problem is that LSU had a completely independent reason for refusing to cooperate with BRF, which predated any alleged coercion by Willis-Knighton. Specifically, LSU issued a notice of breach to BRF in 2015--the year before LSU’s cash crunch and Willis-Knighton’s alleged coercion.” (emphasis in original).
• And as to the related monopolization claim under section 2, the relevant allegations “are little more than high-level assertions about how wonderful things would be if Willis-Knighton hadn’t formed an exclusive-dealing relationship with LSU … [T]hey are miles away from plausibly alleging that Willis-Knighton came close to substantially foreclosing the Shreveport healthcare market.”

No. 21-30622 (Sept. 19, 2022).

Today 600Camp celebrates its 11th birthday! For old times’ sake, here is the 10th-anniversary post from last year. Stir up some Shrimp Remoulade to celebrate properly!

The Fifth Circuit found an improper use of the Declaratory Judgment Act, and thus declined to apply the “first-filed” rule to a Louisiana lawsuit and deferring to another proceeding in Texas, when the record showed these facts:

“In June 2021, Bee Sand sued Pontchartrain in Texas state court. Pontchartrain removed the case to federal court in July. Later that month, Bee Sand voluntarily dismissed the case, and explained to Pontchartrain that it intended to refile in September— after a new Texas law governing attorney’s fees went into effect. Bee Sand also offered to refile in federal court to spare Pontchartrain the expense of a second removal, and Pontchartrain said that it would consider the matter. Instead of responding to this offer, Pontchartrain sought to preempt Bee Sand by suing in Louisiana state court on August 26, 2021. Pontchartrain requested a declaratory judgment in its favor.”

Pontchartrain Partners, LLC v. Tierra de los Lagos, LLC, No. 22-30286 (Sept. 15, 2022).

After a 5-4 order from the Supreme Court that allowed a stay of Texas’ social-media law to remain in effect, a 2-1 panel opinion  rejected a First Amendment challenge to that law in NetChoice LLC v. Paxton, No. 21-51178 (Sept. 16, 2022) (Judge Oldham writing the majority opinion, largely joined by Judge Jones who wrote her own concurrence, with Judge Southwick dissenting). The dissent aptly observed: “The Supreme Court will, as always, have the final word.”

Legal instruments often contain polite phrases before they get to the actual command in the instrument (“you have been sued and must file an answer,” or “you have been drafted,” etc.) Defense Distributed v. Platkin presents an unusual example of polite language in a legal instrument with no accompanying command, the background for which is as follows:

• Earlier this year, a 2-1 Fifth panel decision ordered a district judge, who had transferred a case about 3-D printed firearms to the District of New Jersey, to request the retransfer of that case back to Texas. (Judge Jones wrote the opinion, joined by Judge Elrod, with Judge Higginson dissenting).
• The New Jersey court considered the matter and declined the request on July 27.
• The Texas judge then closed the file, prompting further proceedings in the Fifth Circuit.

On September 16, the Court issued a routine order setting the matter for the earliest available argument date–but with a concurrence joined by two judges, asking that the New Jersey court reconsider the issue of transfer back to Texas:

“We can think of no substantive reason—and none has been offered to us—why this case should nevertheless proceed in New Jersey rather than Texas, other than disagreement with our decision in Defense Distributed. The Attorney General of New Jersey confirmed as much during oral argument. So we respectfully ask the District of New Jersey to honor our decision in Defense Distributed and grant the request to return the case back to the Western District of Texas—consistent with the judiciary’s longstanding tradition of comity, both within and across the circuits ….”

No. 22-50669 (Sept. 16, 2022) (Judge Ho concurring, joined by Judge Elrod, but not Judge Graves).

A surprising amount of case law addresses not whether a particular legal conclusion is correct, but whether it is “correct enough”–qualified immunity, for example, as well as mandamus cases about whether a “clear error” occurred in applying the law. Another such area involves whether the Fifth or the Federal Circuit has appellate jurisdiction over “Walker Process cases”–antitrust claims based on enforcement of a fraudulent patent. In Chandler v. Phoenix Services LLC, the Fifth Circuit held:

“We differ with the Federal Circuit over whether we have appellate jurisdiction over Walker Process cases. But the Supreme Court has told us to accept circuit-to-circuit transfers if the jurisdictional question is ‘plausible.’ While we continue to disagree with the Federal Circuit on this point, we do not find the transfer implausible. We therefore accept the case and affirm the district court’s judgment.”

No. 21-10626 (Aug. 15, 2022) (citations omitted).

It’s been a busy fall for the Dormant Commerce Clause. In addition to the Fifth Circuit’s recent invalidation of a Texas law about the ownership of electricity-generation facilities, the Court also struck down a New Orleans residency requirement for the ownership of Vrbo-type rental properties:

The district court held that the residency requirement discriminated against interstate commerce. That was the right call. But the court then applied the Pike test [for an incidental effect] to uphold the law. That was a mistake; it should have asked whether the City had reasonable nondiscriminatory alternatives to achieve its policy goals. Because there are many such alternatives, the residency requirement is unconstitutional under the dormant Commerce Clause.

Hignell-Stark v. City of New Orleans, No. 21-30643 (Aug. 22, 2022).

Henley v. Biloxi H.M.A., L.L.C., No. 20-60991 (Aug. 31, 2022), presented a thorny issue about tort liability for nondisclosure; here, certain information about rates charged by health-care providers. Applying the relevant Restatement provisions, the Fifth Circuit rejected the district court’s distinction between “basic” and “material” facts, and reversed the dismissal of the nondisclosure claim under Rule 12(b)(6).No. 20-60991 (Aug. 31, 2022).

The plaintiff in King v. Baylor Univ. contended that Baylor had breached a contract with her (the “Financial Responsibility Agreement” pursuant to which she paid her tuition). During the COVID-19 pandemic, students at Baylor University were promised that they would have live classes on campus, but the university went “all-virtual” instead. She contended that she had made an informed decision to attend Baylor “live” when in fact her education was delivered remotely. The Fifth Circuit found potential ambiguity in the phrase “educational services” in the parties’ contract and remanded for further development of that issue. No. 21-50352 (Aug. 23, 2022).

In addition to the Court’s holding about the dormant Commerce Clause, NextEra Energy Capital v. Lake explained why the plaintiff’s claim based on the Commerce Clause was properly rejected (with citations omitted, although the citations are valuable and instructive):

          One of the original Constitution’s only express limitations on state power, it directs that “No State shall … pass any …  Law impairing the Obligation of Contracts.” The Contracts Clause was a response to the state laws relieving debtors during the 1780s. In the first century or so of the Republic, before the Bill of Rights restricted states, the Contracts Clause was “the primary vehicle for federal review of state legislation.”  Some of the greatest hits of the antebellum Supreme Court were Contracts Clause cases.

          But unlike the dormant Commerce Clause, the Contracts Clause is not what it once was. The Supreme Court substantially narrowed its scope during the Great Depression. Under modern caselaw, states have some leeway to alter parties’ contractual relationships “to safeguard the vital interests of [their] people.”

          A related principle that has sapped the Contracts Clause of its earlier force applies here. We now recognize that parties contract with an expectation of possible regulation. That is especially true in highly regulated industries like power. That history of regulation put NextEra on notice that Texas could enact additional regulations affecting its two projects.  After Order 1000, there was substantial uncertainty about how state regulators would respond.

          Despite PUCT’s declaration that transmission-only companies could enter the market, Texas courts never weighed in on the issue. Moreover, the emergence of state rights of first refusal signaled that Texas could enact something similar, if not more restrictive.

No. 20-50160 (Aug. 30, 2022).

“Imagine if Texas—a state that prides itself on promoting free enterprise—passed a law saying that only those with existing oil wells in the state could drill new wells. It would be hard to believe. It would also raise significant questions under the dormant Commerce Clause. …

Texas recently enacted such a ban on new entrants in a market with a more direct connection to interstate commerce than the drilling of oil wells: the building of transmission lines that are part of multistate electricity
grids. A 2019 law says that the ability to build, own, or operate new lines “that directly [connect] with an existing utility facility . . . may be granted only to the owner of that existing facility.” …

NextEra challenges the new law, as it applies to the interstate electricity networks in Texas (but not the intrastate ERCOT network), on dormant Commerce Clause grounds. … Once we wade through the thicket of electricity regulation, the ban’s interference with interstate commerce becomes as clear as it is for the oil well hypothetical. We thus conclude that the dormant Commerce Clause claims should proceed past the pleading stage.”

NextEra Energy Capital v. Lake, No. 20-50160 (Aug. 30, 2022) (citations omitted).

For August’s end-of-month summary by the Fifth Circuit Bar Association, I contributed a one-page article about preparation for oral argument, complete with action picture (right), joining a similar one contributed last month by Association president Tom Flanagan of New Orleans. If you belong to the BAFFC, I encourage you to write one of your own! And if you don’t belong you should, it’s a great resource and features an outstanding body of work about the Fifth Circuit by the able Walter Woodruff, also of New Orleans.