In Sosebee v. Steadfast Insurance Co., the Fifth Circuit found that an insurer made an effective reservation of rights, reminding that “Louisiana follows a functional approach to the reservation of rights and we have rejected requirements for technical language . . . .”  No. 11-31134 (Nov. 27, 2012) (citing FDIC v. Duffy, 47 F.3d 146, 151 (5th Cir. 1995)).  The Court then analyzed whether the insurer waived that reservation, in the unusual setting of a direct action suit against the insurer while the insured was in bankruptcy.  Finding no harm or prejudice to the insured from the conduct at issue, the Court held that no waiver occurred, and reversed and rendered summary judgment for the insurer.

In Hornbeck Offshore Services v. Salazar, the Secretary of the Interior appealed a $530,000 civil contempt award.  No. 11-30936 (Nov. 27, 2012).  After the Deepwater Horizon disaster, the Interior Department imposed an offshore drilling moratorium, which the district court enjoined on the ground that Interior had not properly followed the Adminstrative Procedure Act.  Interior then imposed a new moratorium supported by more detailed findings.  The Fifth Circuit reversed the contempt award, noting that the district court had not based its ruling on a potential ground about Interior’s authority, and stating: “In essence, the company argues that . . . the Interior Department ignored the purpose of the district court’s injunction.  If the purpose were to assure the resumption of operations until further court order, it was not clearly set out in the injunction.”  Id. at 12.  A dissent criticized the majority for “making unreasonably restrictive fact findings of its own to reach an narrow and unworkably technical result.”  Id. at 22.  The Washington Post covers the case here.

The Fifth Circuit makes a major contribution to the law of international insolvency proceedings in Ad Hoc Group of Vitro Noteholders v. Vitro SAB de CV, Nos. 12-10542, 12-10869, 12-10750 (Nov. 28, 2012, rev’d Jan. 7, 2013).  The opinion affirms a series of rulings under Chapter 15 of the Bankruptcy Code (which implements the UNCITRAL model law on cross-border insolvency): that (1) recognized the legitimacy of the Mexican reorganization proceeding involving Vitro (the largest glassmaker in Mexico with over $1 billion in debt), (2) recognized the validity of the foreign representatives appointed as a result of that proceeding, analogizing their appointment process to the management of a debtor in possession in the U.S., and (3) denied to enforce the plan on the grounds of comity.  The detailed comity analysis turns on the U.S. bankruptcy system’s disfavor for non-consensual, non-debtor releases.  The framework of the opinion is broadly applicable to a wide range of cross-border insolvency situations and addresses issues of first impression about the scope of relief available under Chapter 15.  A representative article about the case in Businessweek appears here.

In re Atlantic Marine Construction denied a mandamus petition about enforcement of a forum selection clause, finding no “clear abuse of discretion.”  No. 12-50826 (Nov. 19, 2012).  The majority and specially concurring opinions exchanged detailed views on whether Fed. R. Civ. P. 12(b)(3) or 28 U.S.C. § 1404(a) controls a forum selection issue when the parties did not select state law to govern enforcement of the clause and venue would otherwise be proper in the district of suit.  The majority opinion reflects a continuing conservatism in recent mandamus cases after 2008’s en banc Volkswagen opinion.

In State of Mississippi v. AU Optronics Corp., the Fifth Circuit reversed a remand order, finding that a suit brought to protect consumers by the Mississippi Attorney General was a “mass action” under CAFA. 701 F.3d 796 (2012).  The Court reviewed the pleading, the relevant Mississippi statutes, the general contours of parens patriae law, and its prior case of Louisiana ex rel Caldwell v. Allstate Insurance, 536 F.3d 418 (5th Cir. 2008), which found that policyholders rather than the Louisiana AG were the real parties in interest in an analogous suit.  Based on this analysis, the Court concluded that the numerical requirements of CAFA for a mass action were satisfied, and the “general public policy” exception in the statute was not.  A concurrence endorsed the outcome but questioned the framework used to analyze the statutory exception.

Overlapping state and federal cases about the rights to settlement proceeds led the district court to abstain under the Colorado River doctrine in Saucier v. Aviva Life & Annuity Co., No. 11-60503 (Nov. 16, 2012).  The Fifth Circuit reversed, finding no “exceptional circumstances” warranting abstention.  In reviewing each of the relevant factors, the Court distinguished “duplicative litigation” — which does not warrant absention — from “piecemeal” litigation in which a state court case has more relevant parties than a federal one.  Id. at 7-8.  The Court also reminded that “how much progress has been made” is more important in comparing the status of parallel cases than their respective filing dates.  Id. at 8.

The bankruptcy trustee in Compton v. Anderson filed several avoidance actions, and the bankruptcy court dismissed for lack of standing because the reservation of those claims to the trustee in the debtors’ reorganization plan was not sufficiently “specific and unequivocal.”  No. 11-20478 at 4 (Nov. 14, 2012) (citing Dynasty Oil & Gas v. Citizens Bank, 540 F.3d 351, 355 (5th Cir. 2008)).  The Fifth Circuit reviewed several of its recent cases on this issue and reversed, concluding that “[i]n addition to stating the basis of recovery, the Exhibits referenced in the Reorganization Plan identified each defendant by name.”  Id. at 12. The case was remanded for further review, including the scope of a carve-out in the reservation for released claims.  Id. at 12.  This opinion is an important contribution on a basic issue in bankruptcy litigation.

Smith v. Christus St. Michaels presented a wrongful death claim about an elderly man, who suffered from recurrent cancer, who died from a fall in the hospital while being treated for a blood disorder.  No. 12-40057 (Nov. 13, 2012) (unpublished).  The trial court granted summary judgment under the “lost chance” doctrine, finding a lack of evidence that the man would have been likely to survive his cancer.  The Fifth Circuit reversed because it found his death was caused by a fall unrelated to his cancer or other treatment protocol.  Id. at 8. The Court also reversed a ruling that the plaintiffs’ expert testimony on causation was conclusory, finding that it “sufficiently explained how and why” as to the allegedly inadequate monitoring of the patient’s bedside at night.  Id. at 10.  The opinion provides a general nuts-and-bolts summary of Texas tort causation law.

A series of clerical errors led an insurer to overpay a $710,000 settlement by $510,000.  National Casualty v. Kiva Construction, No. 12-20217 (Nov. 12, 2012).  The insurer sued for breach of contract and “money had and received”; the insured counterclaimed for bad faith in the initial handling of the settlement.  The Fifth Circuit affirmed the district court’s summary judgment for the insurer.  The Court’s straightforward, unpublished opinion offers two cautionary notes — first, while the settlement agreement did not specify a time for payment of the full amount, a Lousiana statute did so specify (although the insurer complied), and second, the Twombly standards are not in play when the district court obviously considered evidence outside of the pleadings and said in its order that the counterclaims failed “based on the undisputed facts.”

In Gibson v. Texas Department of Insurance, a state regulator sought to prohibit an attorney from using the domain: “texasworkerscomplaw.com.”  No. 11-11136 (Oct. 30, 2012). Even assuming the domain name was only commercial speech, the Fifth Circuit reasoned that Texas failed to show that the name was inherently deceptive, and also “made no serious attempt to justify” its regulation as an effort to “prevent misuse of the DWC’s names and symbols.”  Id. at 9-10.  The Court thus reversed and remanded for consideration of the “misuse” issue and to allow Gibson to show that the domain was “ordinary, communicative speech, and not merely . . . commercial speech.”  Its analysis reviewed several cases about trademark issues in the domain name context.  Id. at 8 & n.1.

In Ackal v. Centennial Beauregard Cellular, the Fifth Circuit reversed the certification of a class of Louisiana governmental entities who contracted with the class defendants for cell phone service.  No. 12-30084 (Oct. 26, 2012).  The Court reasoned that because Louisiana law requires many of the entities to follow a specific process before retaining outside legal counsel, the class was essentially “opt in” — a class structure expressly foreclosed by Rule 23(b)(3), which allows only class member “opt out.”  Id. at 6 (citing Kern v. Siemens Corp., 393 F.3d 120 (2d Cir. 2004)).

An unpublished opinion reversed the vacating of a FINRA arbitration award in Morgan Keegan v. Garrett, No. 11-20736 (Oct. 23, 2012).  The Court reversed a finding of fraudulent testimony “because the grounds for [the alleged] fraud were discoverable by due diligence before or during the . . . arbitration.”  Id. at 8.  The Court also deferred to the panel’s conclusions about the scope of the arbitration as consistent with the authority given by the FINRA rules.  Id. at 10-12.  Throughout, the opinion summarizes Circuit authority about the appropriate level of deference to the panel in a confirmation seting.

The receiver for the Allen Stanford entities sued to recover $1.6 million in contributions to political committees as fraudulent transfers under Texas law.  Janvey v. Democratic Senatorial Campaign Committee, No. 11-10704 (Oct. 23, 2012).   The Fifth Circuit affirmed summary judgment for the receiver, holding: (1) notwithstanding some conflicting language in prior opinions, the receiver had standing to “maintain . . . actions done in fraud of creditors even though the corporation would not be permitted to do so”; (2) limitations ran from the discovery of the fraud, not the public disclosure of the payments under federal election law; and (3) TUFTA was not preempted by that law, noting its limited preemptive effect and the lack of a conflict as to election regulation.

“The thirty-eight monks of St. Joseph Abbey,” unable to earn income from the abbey’s timberland after Hurricane Katrina, began to sell handmade funeral caskets at a price significantly lower than that offered by funeral homes.  The Louisiana State Board of Embalmers and Funeral Directors contended that these sales violated state regulations, and the monks sought relief under the 14th Amendment, arguing that the regulations had no rational basis as applied to them.  St. Joseph Abbey v. Castille, No. 11-30756 (rev’d Nov. 21, 2012).  After an exceptionally thorough review of due process principles in the context of “rational basis review” of economic regulation (which Judge Haynes declined to join as unnecessary), the Court certified a question to the Louisiana Supreme Court about the scope of the relevant enabling statute.

Several months ago, the Court held that a stay is not automatic during an appeal about arbitrability, weighing in on an important procedural issue addressed by several other Circuits.  Weingarten Realty v. Miller, 661 F.3d 904 (5th Cir. 2011).  In an unpublished opinion, the Court has now addressed the merits and affirmed the denial of the motion to compel arbitration under an “equitable estoppel” theory, offering a basic reminder about that concept — arbitration is not proper when the guaranty as to which the plaintiff sought a declaration was distinct from the loan agreement that contained the arbitration clause.  Weingarten Realty v. Miller (2), No. 11-20676 (Oct. 22, 2012).

ACE American Insurance v. Freeport Welding presents a thorough analysis of coverage, in the duty to defend context, under Texas law for a party claiming to be an “additional insured.”  No. 12-20002 (Oct. 19, 2012).  Before analyzing the allegations under Texas’s “eight corners” rule, the Court first reviewed whether the party was within the scope of the policy under general contract principles, and found that it was not.  The key to the Court’s analysis was the clarity of the policy documents about the dates for coverage.  Summary judgment was affirmed for the insurer as to the duty to defend, and the related indemnity issues were remanded for further consideration in light of the parties’ settlement.

In affirming the dismissal of a warranty claim under Louisiana law about the construction of a home, the Fifth Circuit reviewed basic requirements for an “Erie guess” about state law.  Gines v. D.R. Horton Inc., No. 12-30183 (Oct. 17, 2012).  The analysis requires that the federal court “attempt to predict state law, not to create or modify it,” and does not allow it “to fashion new theories of recovery.”  Id. at 4 (quoting American Waste & Pollution Control Co. v. Browning-Ferris, Inc., 949 F.2d 1384, 1386 (5th Cir. 1991)).  Intermediate state court decisions receive deference “unless [we are] convinced by other persuasive data that the higher court of the state would decide otherwise.”  Id. (quoting Cerda v. 2004-EQR1 LLC, 612 F.3d 781, 794 (5th Cir. 2010)).

After reviewing the application of judicial estoppel in the bankruptcy context as to a debtor’s claim in Love v. Tyson Foods, 677 F.3d 258 (5th Cir. 2012), the Court applied the doctrine to a creditor’s claim in Wells Fargo v. Oparaji, No. 11-20871 (Oct. 5, 2012).  After carefully reviewing the elements of that doctrine in this circuit, the Court found that Wells did not adopt “plainly inconsistent position[s]” in the debtor’s two bankruptcies, observing that a creditor is not required to include all accrued liability in every revised proof of claim.  The Court also found that the debtor’s failure to follow the plan in his first bankruptcy barred him from now invoking the equitable remedy of judicial estoppel based on those proceedings.

After granting en banc review, and thus vacating the panel opinion in Access Mediquip v. United Healthcare, the en banc court has now reinstated the panel opinion and expressly overruled prior cases that were in tension with the panel’s analysis of ERISA preemption as to misrepresentation claims.  No. 10-20868 (Oct. 5, 2012).

In Highland Capital Management v. Bank of America, the Fifth Circuit reversed a Rule 12 dismissal of a claim for breach of an oral contract.  No. 11-11139 (Oct. 2, 2012).  The Court noted the practical difficulty of applying the legal test for intent to be bound by an oral contract, largely developed on summary judgment records, in the pleading context.  The Court acknowledged that after the phone call in which the plaintiff alleged the contract formed, email called their deal “subject to” further amendment.  The plaintiff, however, alleged sufficient facts about whether all material terms were agreed on in the call, the industry custom for the type of transaction, and the nature of the further discussions to state a plausible contract claim.  The Court affirmed the dismissal of a promissory estoppel claim for failure to adequately plead reliance.

While Opulent Life Church v. City of Holly Springs turned on First Amendment religion clause issues about the legality of a zoning ordinance, it offers some general insights about preliminary injunction practice.  No. 12-60052 (Sept. 27, 2012).  Irreparable injury can potentially be shown from evidence about the likely loss of a lease, or a looming lack of building capacity (although the capacity issue in this case focused on religious practice.)  Id. at 27.  Even if evidence of injury is strong, the party opposing a preliminary injunction should have the opportunity to be heard and present evidence about the potential harm to it of an injunction so that the equities can be balanced.  Id. at 28-29.

In Cambridge Integrated Services Group v. Concentra Integrated Services, after reminding that a district court located in a state does not get deference in making an Erie guess about that state’s law, the Fifth Circuit examined the effect of a release obtained by an indemnitor for potential claims against its indemnitee.  No. 11-31032 (Sept. 26, 2012).  The Court found that the release precisely matched the terms of the indemnitor’s obligations to the indemnitee, and thus extinguished its duty to indemnify against such claims in ongoing litigation.  As to the duty to defend, however, the Court found summary judgment improper as issues about the claims “remained to be clarified through litigation.”  Id. at 10.

Judge Edith Jones has resigned as Chief Judge of the Fifth Circuit, to be succeeded by Judge Carl Stewart from Louisiana.  She will continue to serve on the Court.  This change returns the Court to a familiar balance seen with Chief Judges Henry Politz and Carolyn King, when a Democratically-appointed Chief presided over a court with a majority of Republican-appointed judges.

Earlier this year, the Fifth Circuit largely affirmed a series of rulings about governmental immunity in litigation about flood damage from Hurricane Katrina, allowing some cases to proceed and finding the government immune as to others.  On rehearing, the Court found that the “discretionary-function exemption” to the Federal Tort Claims Act created immunity even if the Flood Control Act did not.  In re Katrina Canal Breaches Litigation at 25-26 (Sept. 24, 2012) (“Our construction of the FCA leaves undisturbed the district court’s ruling on that issue.  Our application of the DFE, however, completely insulates the government from liability.”).

600camp.com celebrates its first birthday today.  A website can’t serve birthday cake, but it can share the world-famous recipe of the great New Orleans restaurant, Galatoire’s, for bread pudding.  Thanks to Lynn Tillotson and all friends and supporters.

After a 3-day hearing, a bankruptcy court certified a class for injunctive relief about foreclosure-related fees during the debtors’ bankruptcy proceedings.  Rodriguez v. Countrywide Home Loans, No. 11-40056 (Sept. 14, 2012).  The Fifth Circuit affirmed, finding that Countrywide’s acts were “generally applicable” to the “narrowly certified . . . class of approximately 125 individuals.”  Id. at 6 (distinguishing Wilborn v. Wells Fargo, 609 F.3d 748 (5th Cir. 2010)).  The Court also found that the relevant records were readily searched and that Countrywide had a consistent “practice” even though it had no formal company policy as to the fees.  Id. at 9, 10-11 (distinguishing Wal-Mart v. Dukes, 131 S. Ct. 2541 (2011)).

A consumer group sued under the Clayton Act about the market for funeral caskets, and then settled all compensatory damages with one of the defendants.  Funeral Consumers Alliance v. Service Corp. Int’l, No. 10-20719 (Sept. 13, 2012).  The Fifth Circuit held that, even after that settlement, the group had standing to proceed against the remaining defendants for attorneys fees.  Id. at 4-14.  Noting, however, that “[t]he fact that death is inevitable is not sufficient to establish a real and immediate threat of future harm,” the Court found no standing for injunctive relief.  Id. at 15, 18.  The Court also affirmed the denial of class certification, finding that the scope of the putative nationwide class fit poorly with the evidence of localized market activity for funeral services and casket sales.  Id. at 27 (distinguishing United States v. Grinnell Corp., 384 U.S. 563 (1996)).

From the second third of 2012, here are 5 commercial litigation cases from the U.S. Court of Appeals for the Fifth Circuit worth knowing:

1.  Personal jurisdiction.  “[O]ff-the-shelf, out-of-the-box” software contract did not create a “long-term interactive business relationship” with Texas.  Pervasive Software v. Lexware GMBH & Co., No. 11-50097 (5th Cir. July 20, 2012).

2.  Class certification.  No “commonality” for claims about “whether each individual qualified for the discount based on the evidence in his or her file.”  Ahmad v. Old Republic Nat’l Title Ins., No. 11-10695 (5th Cir. Aug. 13, 2012).

3.  Daubert challenges rejected.  Several issues about mechanical engineering testimony “ultimately . . . affected the weight of the evidence” rather than admissibility.  Roman v. Western Manufacturing, No. 10-31271 (5th Cir. Aug. 17, 2012)

4 and 5.  Satisfying Twombly and Iqbal 

Not enough: pleading that “invokes three potentially cognizable theories of liability,” but “does not identify by date or amount or type of service, any of the alleged bad-faith denials and delays . . . .”  Patrick v. Wal-Mart, 681 F.3d 614 (5th Cir. 2012).

Not enough: “no allegations regarding the types of businesses . . . the size . . . where they are located, or what laws and regulations they have violated.”  Bowlby v. City of Aberdeen, 681 F.3d 215 (5th Cir. 2012).

Compare: “Particularity” standard under FRCP 9(b) “require[s] a plaintiff pleading fraud to specify the statements contended to be fraudulent, identify the speaker, state when and where the statements were made, and explain why the statements were fraudulent. . . . the who, what, when, where, and how of the events at issue.”  E.g., Dorsey v. Portfolio Equities, 540 F.3d 333, 339 (5th Cir. 2008).

The unpublished case of Gibbs v. Lufkin Industries reviews the basics of anti-suit injunctions.  No. 11-50524 (Sept. 7, 2012).  The district court dismissed some of plaintiffs’ claims (including the federal ones), remanded the remaining state claims, and enjoined pursuit of those claims during appeal of the dismissal ruling.  The Fifth Circuit reversed, noting that the second court ordinarily determines the preclusive effect of a prior court’s judgment, and that simultaneous in personam proceedings do not by themselves require an anti-suit injunction.  Id. at 6.  The Court distinguished Brookshire Bros. v. Dayco Products, 2009 WL 8518382 (5th Cir. Jan. 23, 2009) as arising from the erroneous remand of the same proceeding.

The plaintiff in Coe v. Chesapeake Exploration won a $20 million judgment for breach of a contract to buy rights in the Haynesville Shale formation, against the background of a a “plummet[]” in the price of natural gas.  No. 11-41003 (Sept. 12, 2012).  The Fifth Circuit affirmed.  After review of other analogous energy cases, the Court found that  the parties’ writing had a sufficient “nucleus of description” of the property to satisfy the Statute of Frauds, even though some review of public records was required to fully identify the property from that “nucleus.”  Id. at 11-12.  The Court also found that the parties had reached an enforceable agreement and that Plaintiff had tendered performance, finding an “adjustment clause” specifying a per-acre price particularly relevant on the tender issue.  Id. at 16, 17-18.

Texas Keystone v. Prime Natural Resources began as an application for U.S. discovery in support of an English court case pursuant to 28 U.S.C. § 1782.  After review of that statute and its relationship with Fed. R. Civ. P. 26 once discovery is ordered, the Court found an abuse of discretion when the trial court granted the respondents’ Motion to Quash without a response from the party requesting discovery.  Id. at 10-13 (citing Sandsend Financial Consultants v. FLHBB, 878 F.2d 875 (5th Cir. 1989) and Wiwa v. Royal Dutch Petroleum, 392 F.2d 812 (5th Cir. 2004)).  The Court’s analysis of section 1782, intended to guide the district court on remand, also provides general background for future discovery requests in the Circuit under that statute.

Baisden v. I’m Ready Productions involved several challenges to a defense verdict in a copyright infringement case.  No. 11-20290 (Aug. 31, 2012).  Among other holdings, the Fifth Circuit reminded that “[c]onsent for an implied [nonexclusive] license may take the form of permission or lack of objection,” making the Copyright Act’s requirement of a writing inapplicable.  Id. at 9-10 (reviewing Lulirama Ltd. v. Axcess Broad. Servs., 128 F.3d 872 (5th Cir. 1997)).  The Court also reviewed a jury instruction that allegedly conflated the question of license with that of infringement — a potential problem since the burdens are different on the two points — but found that while “the question is not a model of clarity” it did not give rise to reversible error.  Id. at 19-21.

The plaintiff in Lozano v. Bosdet did not serve a British defendant within the 120 days of Fed. R. Civ. P. 4, or a later extension by the district court.  No. 11-60737 (Aug. 31, 2012).  The Fifth Circuit, noting “that statutory interpretation is a ‘holistic endeavor,'” applied a “flexible due-diligence” standard to find that dismissal was not warranted, especially since a refiled suit would likely be time-barred.  Id. at 7, 9.  The Court aligned itself with the Seventh Circuit and rejected different readings of Rule 4(f) in the international context by the Ninth Circuit (unlimited time) and Second Circuit (120-day limit excused only if service is attempted in the foreign country), noting that it did not wish to require “immediate resort to the Hague Convention or other international methods.”  Id. at 5-6.

In National Union v. American Eurocopter, a contribution suit arising from settlement of claims about a helicopter crash, a Hawaii district court found no personal jurisdiction and transferred venue to Texas.  No. 11-10798 (Aug. 27, 2012).  The appellant challenged that ruling, and the Fifth Circuit held that it lacked jurisdiction over that issue.  Id at 4 (quoting 28 U.S.C. § 1294, defining appellate jurisdiction as reaching “appeals . . . [f]rom a district court of the United States to the court of appeals for the circuit embracing the district”).  On the merits, the Court affirmed a dispositive choice-of-law ruling for Texas law, noting a Texas choice-of-law provision in a relevant contract, a rough balance between the place of the accident (Hawaii) and the defendants’ headquarters (Texas), and the relatively weak interest of an out-of-state insurer.  Id. at 5-7 (noting Beech Aircraft v. Jinkins,  739 S.W.2d 19 (Tex. 1987)).

Vanderbilt Mortgage v. Flores, arising from a collection suit about the financing for a mobile home, involved a substantial recovery on counterclaims for wrongful debt collection and filing of a fraudulent lien.  692 F.3d 357 (5th Cir. 2012).  The Fifth Circuit affirmed in part and reversed in part, finding: (1) the release of the debtors unambiguously reached only the lien and not the underlying debt (thereby mooting some counterclaims); (2) property owners in the position of these debtors did not have an ongoing duty, for limitations purposes, to check deed records; (3) Tex. Civ. Prac. & Rem Code chapter 12, about fraudulent liens, does not require actual damages before penalties may be awarded; (4) Chapter 12 does not violate the Excessive Fines Clause; and (5) personal jurisdiction over one defendant was appropriate, particularly given the confusion in its own records about its activities.

In the unpublished case of Blake Box v. Dallas Mexican Consulate General, the Fifth Circuit reversed a dismissal for lack of jurisdiction under the Foreign  Sovereign Immunities Act  because discovery was not allowed on whether a Mexican government representative had actual authority.  No. 11-10126 (Aug. 21, 2012).  Acknowledging that the FSIA seeks to reduce litigation involving sovereigns, the Court found that authority “is a discrete issue conducive to limited discovery [and] the relevant documents reside exclusively with the defendant . . . ”  Id. at 7-8.  The analysis and cited cases are of general interest in other jurisdictional discovery situations.  Disclosure: LTPC colleagues Jason Dennis and Sam Hardy represented the successful appellant.

Appellate jurisdiction over bankruptcy matters can become murky (as discussed in this 2009 CLE paper) because finality is not always obvious.  In an appeal from an individual’s  bankruptcy case, the Court reminded that the test is whether a district court order is a “final determination of the rights of the parties to secure the relief they seek” or a “final disposition ‘of a discrete dispute within the larger bankruptcy case.'”  Sikes v. Crager, No. 11-30982 at 3 (Aug. 16, 2012) (quoting Bartee v. Tara Colony Homeowners Ass’n, 212 F.3d 277 (5th Cir. 2000).   The district court’s finding that the debtor’s Chapter 13 plan was not made in good faith “involve[d] a discrete dispute within her case” and created jurisdiction.

The plaintiff in Choice Inc. of Texas v. Greenstein challenged a Louisiana regulation about the licensing of abortion facilities.  No. 11-30296 (Aug. 17, 2012).  The majority found the suit was not ripe because the plaintiff did not show “that hardship will result if court consideration is withheld at this time.”  Id. at 7.  A forceful dissent faulted the majority for a “procrustean ripeness analysis.”  Id. at 32.   While much of the back-and-forth involves matters unique to abortion litigation, the case presents a thorough review of general  principles about ripeness in the Fifth Circuit at present.

Roman v. Western Manufacturing examined a $1mm-plus verdict about severe injuries from a pump malfunction.  No. 10-31271 (Aug. 17, 2012).  After review of the standards, id. at 5 (“It is not our charge to decide which side has the more persuasive case.”), the Court found that two qualified mechanical engineers met Daubert even though they lacked extensive experience with “stucco pumps,” declining to “make expert certification decisions a battle of labels.”  Id. at 7.  The Court also rejected technical challenges to the type of pump reviewed by the experts and the plausibility of their factual assumptions about its operation, id. at 13 (“There was certainly contrary evidence, but that was for jurors to weigh.”), as well as sufficiency challenges about the inferences made by the jury.  Id. at 16-17.  Additional challenges were found waived under Fed. R. Civ. P. 50.  This opinion is the latest in a series of thoughtful cases about Daubert after the 2009 decision in Huss v. Gayden.

Globeranger Corp. v. Software AG involved Texas state law claims about the development of a radio frequency identification system.   No. 11-10939 (Aug. 17, 2012).  The defendants removed and obtained dismissal on the grounds of Copyright Act preemption.  The Fifth Circuit agreed that section 301(a) of the Act creates complete preemption, and on the applicable test: “whether [the claim] falls ‘within the subject matter of copyright'” and whether it “protects rights that are ‘equivalent'” to those of a copyright.  Id. at 6 (citing Carson v. Dynegy, 344 F.3d 446, 456 (5th Cir. 2003)).  After through review of prior cases, the Court held that the conversion claim was likely preempted (thereby maintaining federal jurisdiction), but that the general basis for the claims included business practices excluded from copyright protection, making dismissal at the Rule 12 stage inappropriate.  Id. at 10-12.

Finding that the EPA’s action was “[s]ixteen years tardy” and “without basis in the Clean Air Act or its implementing regulations,” the Court vacated an EPA rule that would have voided roughly 140 permits for various pollution-emitting businesses in Texas.  State of Texas v. EPA, No. 10-60614 (Aug. 13, 2012).

In Ahmad v. Old Republic National Title Insurance, the Court reversed a grant of class certification in a case about title insurance premiums.  No. 11-10695 (Aug. 13, 2012).  The Court relied on Benavides v. Chicago Title, 636 F.3d 699 (5th Cir. 2011), which declined to certify a similar class of title insurance buyers because “[t]he resulting trial would require the factfinder to determine whether each individual qualified for the discount based on the evidence in his or her file.”  Op. at 9.   The Court declined to distinguish Benavides even though a particular discount was mandatory once “the requirements of R-8 [a Texas Insurance Code provision]” were satisfied, because each plaintiff would present unique facts about those requirements.  Id. at 10-11.  Therefore, the class did not meet the commonality requirement of Fed. R. Civ. P. 23(a)(2).

The bankruptcy court in CRG Partners v. Neary awarded a $1 million fee enhancement for  a “rare and exceptional” result in the Pilgrim’s Pride bankruptcy.  No. 11-10774 (Aug. 10, 2012).  The Trustee objected, arguing that Perdue v. Kenny A. ex rel Winn, 130 S. Ct. 1662 (2010) — a case rejecting a comparable enhancement under 42 U.S.C. § 1988 — impliedly overruled older Fifth Circuit authority that allowed them in bankruptcy.  The Court carefully reviewed Perdue under the “rule of orderliness,” a set of principles that guide a panel’s fidelity to older panel opinions, and found Perdue distinguishable factually and for policy reasons.  Op. at 22-25.  The Court reminded that it had recently reached a similar conclusion as to the effect of Stern v. Marshall, 131 S. Ct. 2594 (2011), on magistrate jurisdiction.

An unpublished opinion affirmed a ruling that an SEC suit about backdating was barred by limitations and the discovery rule did not apply.  SEC v. Microtune, No. 11-10594 (Aug. 7, 2012).  An interesting analysis of the opinion and its potential broader significance appears in the August 11, 2012 Texas LawBook.

Echoing its recent action in Sawyer v. du Pont, the Fifth Circuit withdrew its previous opinion in Ewing Construction v. Amerisure Insurance and certified two questions to the Texas Supreme Court about the scope of the “contractual liability” exclusion in a construction contractor’s CGL policy.  No. 11-40512 (Aug. 8, 2012).

Lowry Development LLC v. Groves & Assocs. Insurance involved a real estate developer who sued its insurer about coverage for wind damage, and alternatively, its insurance agent for negligence.  No. 11-60670 (Aug. 3, 2012).  The district court granted summary judgment for the developer against the insurer (thereby mooting the claim against the agent), which the Fifth Circuit reversed.  Id. at 3.   The developer then sought to reinstate its claim against the agent.  The Court found that the agent’s dismissal was “based on an earlier judgment that has been reversed or vacated” and thus came within Fed. R. Civ. P. 60(b)(5).  The agent argued that the insurer should have taken a protective appeal at the time of the original dismissal, but the Court, “[a]cknowledging that [plaintiff’s Rule 60(b) motion looks like the protective appeal it failed to file,” found no abuse of discretion in the district court’s decision to grant the motion.  Id. at 10.

“Does the failure to give notice to an excess carrier until after an adverse jury verdict constitute evidence of prejudice that forfeits coverage?”  Berkley Regional Ins. Co. v. Philadelphia Indemnity Ins. Co., 690 F.3d 342 (5th Cir. 2012).  The Court thoroughly reviewed Texas law about untimely claim notice, observing that it can void coverage if the insurer is prejudiced, but “[d]efining the contours of prejudice from the breach of a notice requirement . . . is not easy.”  It applied that general principle to excess carriers, and found that this carrier had raised fact issues about prejudice from untimely notice (here, after an adverse jury verdict), as it was unable to investigate the matter or participate in mediation: “The cows had long since left the barn when [the carrier] was invited to close the barn door.”

The case of Little v. Shell Exploration presented an issue of first impression — whether a federal employee, even one whose job is to investigate fraud, may bring a qui tam action under the False Claims Act.  690 F.3d 282 (5th Cir. 2012).  After review of the statutory text, the Court sided with a majority of other Circuits that have addressed the issue and concluded that one may.  The Court acknowledged the practical issue of “how to ensure employee fidelity to agency enforcement priorities in the face of personal monetary incentives,” but concluded that the government could address that issue with personnel guidelines and with its power to intervene and dismiss actions.  The Court remanded for consideration of whether the “public disclosure” and “original source” aspects of the Act barred the specific claims raised by these relators — matters that could limit the scope of the first holding.

City of New Orleans v. BellSouth Telecommunications presented a long-simmering dispute, stretching back to an 1879 ordinance, about BellSouth’s use of public rights-of-way in New Orleans.  Nos. 11-30607 and 11-31058 (July 31, 2012).  The district court awarded $1.5 million in unjust enrichment related to BellSouth’s use after 2006.  The Fifth Circuit reversed, finding that the parties’ complicated relationship gave BellSouth a “‘justification in . . . contract’ for any enrichment it may be enjoying . . . ,” which defeated an unjust enrichment claim under Louisiana law.   Id. at 21, 25 (citing SMP Sales Management v. Fleet Credit Corp., 960 F.2d 557, 560 (5th Cir. 1992)).