After much Sturm und Drang, the District of the District of Columbia returned Clarke v. CFTC to the Texas district court where that case started, reasoning:

[T]he Court will follow the weight of authority and transfer this case back to the requesting jurisdiction because the record establishes that it was transferred prematurely. The Court makes no decision on the Parties’ respective arguments on whether transfer would otherwise be appropriate. It certainly would be easy for the Court to keep this case—the Court currently has a case involving the same challenge against Defendant that is fully briefed and scheduled for argument soon. Nor does the Court quite understand how the District Court in Texas abused its discretion in making its determination. But the weight of authority instructs the Court on how such requests are routinely addressed, and the Court will follow that course of action here.

Clarke v. CFTC (citation omitted) (D.D.C. May 22, 2024).

Thryv, Inc. v. NLRB, a review of the NLRB’s handling of an unfair labor practices case, presents deft usage of a typographical device called the “dinkus”:

Thanks to the observant Cedric Bond for pointing this out!

Hager v. Brinker Texas, Inc. reminds that the business-records exception to the hearsay rule has significant limitations. The Fifth Circuit summarized an earlier case, in a similar dispute about the admissibility of the employer’s records, as holding:

“[A]n employer’s human resource managers’ reports and letters tracing steps in investigating complaints of sexual harassment against an employee leading to discharge were admissible business records; but it also recognized that such reports would be ‘inadmissible where their “primary utility is for litigation.”‘”

Based on that rule, the Court held:

[T]he Venable declaration and Exhibit B were prepared immediately after the threat of Sharnez’s litigation loomed as Brinker knew that Sharnez complained of racial discrimination and mentioned contacting her lawyer. Venable’s conclusory assertion that the declaration and Exhibit B were made in the regular course of Brinker’s business, with no further explanation about whether it was company procedure to make similar records, does not frustrate this conclusion.  Quite the opposite, Venable admitted that he had never before conducted an investigation into a guest complaint of racial discrimination, further undercutting any claim that the declaration was made in the “regular course” of business. 

No. 21-20235 (May 22, 2024).

Lest one think the law of adminstrative stays had become more settled with time, MCR Oil Tools, LLC v. U.S. Dep’t of Transp. reminds otherwise. The manufacturer of a torch used in oil drilling challenged a new safety regulation on its product. The three judges on the panel reacted in different ways:

• The majority opinion defers the motion for stay to the next available argument panel;
• A dissent emphasized the need for immediate action, given the regulation’s effect on significant outstanding orders;
• A concurrence analogized the case to a recent challenge to the Texas ban on drag shows.

No. 24-60230 (May 23, 2024).

“Double, double, toil and trouble,” chanted the three witches of Macbeth.  “Double insulated,” said the Fifth Circuit in CFSA v. CFPB, holding that the Consumer Financial Protection Bureau’s funding mechanism was so far removed from Congress’s ordinary appropriations process that it violated the Appropriation Clause of the Constitution. Parting company with the above, the Supreme Court didn’t use the word “double” in reversing the Fifth Circuit, and holding that the CFPB is appropriately funded, considering history and practicality. CFPB v. CFSA, No. 22-448 (U.S. March 16, 2024).

Martin v. LCMC Health Holdings, Inc. presents a creative use of the “federal officer” removal statute. A hospital argued that because its patient-portal systems were part of a federal information program created by Congress, it “acts under the direction of a federal officer when embedding tracking pixels onto its website where patients may access their medical records.” While creative, the argument didn’t work: “LCMC’s relationship with the federal government is too attenuated to show any delegation of legal authority, and consequently, LCMC cannot show that it acted pursuant to a federal officer’s directions for purposes of federal officer removal. ” No. 23-30522 (May 13, 2024).

In a counterpoint to some treatments of standing in the mifepristone litigation, the Fifth Circuit rejected Texas’s standing to challenge an SEC disclosure requirement, reasoning:

As the States conceded during oral argument, there is no guarantee that regulated parties will always pass costs on to their consumers. Some costs may be too small to warrant a cost pass-through. So any cost pass-through must be established through evidence. We look to the evidence in the record to determine whether the facts of a specific case support “likely . . . pecuniary harm” to a suing party.  Evidence couched in hypothetical language cannot support such an injury. Here, the record provides only speculation about the possibility of increased costs to investors as a result of new regulatory burdens on the funds.

State of Texas v. SEC, No. 23-60079 (May 10, 2024) (citations omitted, paragraph breaks removed, emphasis added).

The civil-criminal distinction was outcome determinative of the issue presented in Charitable DAF Fund, L.P. v. Highland Capital Management, L.P.:

“Highland incurred virtually all its contempt-related expenses because the bankruptcy court permitted extensive discovery and conducted a marathon evidentiary hearing to unearth Dondero’s role in filing the Motion [for Leave]. But Dondero’s intentions were relevant only to criminal contempt—a sanction the bankruptcy court was powerless to impose. Dondero’s intentions—and virtually all of the discovery and the bankruptcy court’s mini-trial—were irrelevant to civil contempt. The only question in civil contempt is whether and to what extent Highland was damaged by DAF’s choice to file the  Motion in the wrong forum. Neither Highland nor the bankruptcy court was permitted to seize on DAF’s error and leverage it into a punitive proceeding.”

No. 22-11036 (April 4, 2024) (citations omitted).

In a dispute about insurance coverage for a freak accident at a drag-racing event, the Fifth Circuit rejected the argument that the policy was ambiguous, reasoning:

“[W]e must construe every part of the CGL Policy—the CGL Declaration, the CGL Form, and the CGL Endorsements simultaneously. So construed, the CGL Policy is not ambiguous.

Begin by considering the relationship between the CGL Form and the CGL Endorsements. Generalia specialibus non derogant. Given that the CGL Form provides general statements regarding coverage, a CGL Endorsement’s more specific statement regarding the same will control where the two conflict. … 

As the CDE Endorsement and MV Endorsement illustrate, the CGL Endorsements modify express subsets of provisions in the CGL Form. They do not, however, expressly purport to modify the CGL Declaration, other provisions in the CGL Form, or other CGL Endorsements. So, relative to the CGL Form, each of the CGL Endorsements addresses a narrower set of provisions in greater detail.

Kinsale Ins. Co. v. Flyin Diesel Performance & Offroad, LLC, No. 23-50336 (April 26, 2024).

In a return to the Fifth Circuit after an earlier panel opinion affirmed an antisuit injunction, the Court applied the Lauritzen-Rhoditis factors to conclude that Liberian law, rather than American, governed a boat crewmember’s claim about catching malaria aboard the ship:

Considered in the context of this case, involving traditional maritime shipping activities and assertions of wrongdoing yielding a seaman’s “shipboard injury,” none of the Lauritzen-Rhoditis factors that the Supreme Court has deemed significant to the choice of-law determination in traditional maritime shipping cases involve the United States. Specifically, the law of the flag factor, which generally is “of cardinal importance” in the traditional maritime shipping context, points to Liberia.

Ganpat v. Eastern Pacific Shipping PTE, No. 22-30758 (May 1, 2024).

In Sanders v. The Boeing Co., No. 22-20317 (May 2, 2024), the Fifth Circuit summarized the two key holdings that resulted from certification of a question about the Texas limitations-savings statute (reproduced in full below):

1. “[Tex. Civ. Prac. & Rem. Code] Section 16.064(a)(1) applies whenever the previous court dismissed an action for lack of jurisdiction. Thus is so even when the court ‘erred and actually had jurisdiction or could have had jurisdiction had the claims been pleaded differently.'” (citation omitted)
2. “[A] dismissal or other disposition does not ‘become final’ for purposes of Section 16.064(a)(2) until the parties have exhausted their appellate remedies and the court’s power to alter the dismissal has ended.'” (citation omitted, cleaned up).

If you have ever wondered “can the party-presentation principle help distinguish holding from dicta?’ then you will enjoy my new article in the Cornell Law Review Online, which hopefully offers some new perspective on some longstanding concepts.

Phillips v. ERCOT addresses a dispute between ERCOT and the liquidating trust of Entrust Energy, a supplier of electriciity to end users, who went into bankruptcy after receiving a large bill in the wake of Winter Storm Uri. In resolving this dispute, the Fifth Circuit held:

• No immunity for ERCOT. The six relevant factors were “an even split,” but because ‘our court has indicated repeatedly that factor 2 [the source of the entity’s funding] is the most important, ERCOT is not an arm of Texas and not entitled to immunity in federal court.”
• Abstention. Burford abstention was required because, inter alia: “federal adjudication of the [programs at issue] risks dramatic intrusion into Texas’s specialized system of electric utility regulation and would disrupt Texas’s efforts to establish a coherent and uniform policy for electric utilities. Under the specific circumstances of this case, the fact that the takings claim arises under federal law and that Texas does not provide any sort of specialized system for review does not support hearing the claim.” (footnote omittted).

No. 22-20603 (April 29, 2024).