Latest 2 Cases: Veritex Community Bank v. Osborne (Bankruptcy), Block v. Texas Board of Law Examiners (Legal Ethics)

Can A City Refuse Land-Use Permits Because it Doesn’t Like the Federal Policies the Property Will be Used to Implement?

VIKRAM DAVID AMAR

Illinois Law dean and professor Vikram David Amar explains why a local government cannot constitutionally create policy discriminating against entities that do business with the feds. Specifically, Amar discusses a situation in which the city of Farland, California, is trying to prevent a privately operated state prison facility located in that city from contracting with Immigration and Customs Enforcement (ICE).

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Veritex Community Bank v. Osborne

Docket: 19-10479

Opinion Date: March 10, 2020

Judge: W. Eugene Davis

Areas of Law: Bankruptcy

Veritex filed an adversary proceeding requesting that debtor's debt not be discharged because he furnished the bank with a materially false written financial statement. The bankruptcy court found that the statement was false and submitted with the intent to deceive, but discharged the debt because Veritex did not rely on the statement. The district court affirmed the bankruptcy court's judgment. The Fifth Circuit reversed and held that the bankruptcy court's finding that Veritex did not reasonably rely on debtor's 2013 financial statement is clearly erroneous. In this case, Veritex looked to debtor to guarantee the loan, and it relied heavily on his financial statement; the alleged red flags were not significant enough to alert Veritex to debtor's dishonesty; and the bankruptcy court erred in focusing on the soundness of the loan rather than the truthfulness of debtor's representations. The court also held that a fraudulent statement by a debtor's partner or agent may be imputed to the debtor under 11 U.S.C. 523(a)(2)(B). Therefore, the bankruptcy court did not err in finding that debtor's wife was his agent. The court rendered judgment in favor of Veritex.

Block v. Texas Board of Law Examiners

Docket: 19-50286

Opinion Date: March 10, 2020

Judge: W. Eugene Davis

Areas of Law: Legal Ethics, Professional Malpractice & Ethics

Plaintiff filed suit against the Board for its refusal to waive the active practice requirement to accommodate his disability. The district court dismissed plaintiff's claim as barred by sovereign immunity. The Fifth Circuit affirmed the district court's dismissal of plaintiff's claims under the first prong of United States v. Georgia, because plaintiff did not allege any conduct that violates Title II of the Americans with Disabilities Act. The court explained that the active practice requirement ensures that applicants have both achieved and maintained the skill and knowledge required to practice law in Texas. By waiving this requirement to admit a lawyer who has neither passed the Texas bar exam nor practiced law for thirteen years would not inform the Board of whether plaintiff currently has the necessary knowledge and skill to practice law. Therefore, the modification plaintiff sought was not reasonable. The court did not reach the issue relied on by the district court. However, plaintiff's claims should have been dismissed without prejudice and thus the court modified the district court's dismissal.