Latest 9 Cases: Louisiana Real Estate Appraisers Board v. Federal Trade Commission (Antitrust & Trade Regulation), Robertson v. Intratek Computer, ...

Reflections on the Pending Supreme Court Challenge to the Affordable Care Act in California v. Texas: Part One in a Series

VIKRAM DAVID AMAR, EVAN CAMINKER, JASON MAZZONE

In this first of a series of columns on the latest prominent challenge to the Affordable Care Act (ACA), Illinois law dean Vikram David Amar, Michigan Law dean emeritus Evan Caminker, and Illinois law professor Jason Mazzone examine the stare decisis effects of the Supreme Court’s initial blockbuster decision involving the ACA. The authors demonstrate several, perhaps surprising, ways that the earlier decision should shape how the Court views the present challenge.

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Louisiana Real Estate Appraisers Board v. Federal Trade Commission

Docket: 19-30796

Opinion Date: October 2, 2020

Judge: Edith H. Jones

Areas of Law: Antitrust & Trade Regulation, Government & Administrative Law

The Fifth Circuit vacated the district court's order staying administrative proceedings that were initiated by the FTC against the Board under the Federal Trade Commission Act. The district court concluded that it lacked jurisdiction over the Board's lawsuit because the Act vests exclusive jurisdiction to review challenges to Commission proceedings in the courts of appeals. The court held that, even if the Act does not preclude the Administrative Procedure Act's default review provision, 5 U.S.C. 704,—an issue the court need not address—the Board fails to meet Section 704's jurisdictional prerequisites. The court explained that case law does not support jurisdiction based on the collateral order doctrine as applied through Section 704. In this case, the issues relevant to immunity pertain to the reach of the Sherman Act and thus a judicial decision at this point would not resolve an issue completely separate from the merits of the action. Therefore, the April 10, 2018 order does not constitute final agency action under Section 704, and the collateral order doctrine does not apply.

Robertson v. Intratek Computer, Inc.

Docket: 19-50792

Opinion Date: October 2, 2020

Judge: Andrew S. Oldham

Areas of Law: Arbitration & Mediation, Contracts, Labor & Employment Law

A federal whistleblower statute, 41 U.S.C. 4712, does not render unenforceable an arbitration agreement between plaintiff and his former employer, Intratek. The Fifth Circuit held that the district court correctly enforced the arbitration agreement between plaintiff and Intratek. However, the court held that the district court erred in compelling arbitration of claims not covered by that agreement. Finally, the court held that the district court did not abuse its discretion by denying plaintiff's motion to amend the complaint. Therefore, the court affirmed in part, reversed in part, and remanded for further proceedings.

Basic Capital Management, Inc., v. Dynex Capital, Inc.

Docket: 19-11272

Opinion Date: October 2, 2020

Judge: Carolyn Dineen King

Areas of Law: Business Law, Civil Procedure

After plaintiffs were unable to collect on a $55 million judgment against Dynex Commercial, Inc., plaintiffs filed a lawsuit against Dynex Commercial, Inc. and Dynex Capital, Inc., alleging fraudulent-transfer and alter-ego claims. The Fifth Circuit affirmed the district court's dismissal of plaintiffs' second amended complaint with prejudice based on the grounds that the fraudulent transfer claim is time-barred and the alter ego claim is barred by res judicata. In this case, plaintiffs knew of or reasonably could have discovered the transfers at least by February 2004, if not earlier, and plaintiffs reasonably could have discovered the allegedly fraudulent nature long before April 2016. Furthermore, plaintiffs' failure to raise an alter-ego claim against Dynex Capital during the state-court litigation does not mean that they can raise such a claim now. The court also stated that the district court appropriately used judicial notice of the Form 10-K and state court record.

Sayers Construction, LLC v. Timberline Construction, Inc.

Docket: 19-51099

Opinion Date: October 2, 2020

Judge: Andrew S. Oldham

Areas of Law: Civil Procedure, Construction Law

A federal district court in Texas does not have jurisdiction to vacate an arbitration award in Florida. The Fifth Circuit affirmed the district court's dismissal of the action based on lack of personal jurisdiction over the subcontractors. The court held that the subcontractors did not have the minimum contacts in Texas such that a Texas court could exercise specific personal jurisdiction over them. In this case, the place of contractual performance was Florida—not Texas, after plaintiff allegedly failed to pay its subcontractors' invoices, the parties met in Florida to discuss the dispute, then they arbitrated the dispute in Florida, and Florida's courts have determined that Florida is a proper venue for the subcontractors to seek enforcement of the arbitration awards. Therefore, the subcontractors did not purposefully avail themselves to being sued in Texas courts.

Valencia v. Allstate Texas Lloyd's

Docket: 20-20193

Opinion Date: October 2, 2020

Judge: Per Curiam

Areas of Law: Civil Procedure, Insurance Law

Plaintiff, a Texas resident, filed suit against Allstate Texas, a Texas entity, seeking damages for breach of contract and violations of the Texas Deceptive Trade Practices Act, the Texas Insurance Code, the Texas Business and Commerce Code, and the Texas Civil Practice and Remedies Code. Allstate Illinois, rather than Allstate Texas, answered the petition and removed the case to federal court on the basis of diversity jurisdiction under 28 U.S.C. 1332(a) and 1441(b). The Fifth Circuit reversed the district court's denial of plaintiff's motion to remand to state court, and remanded with instructions for the district court to remand to state court. The court held that Allstate Illinois lacked the authority to remove the suit to federal court and the district court did not have subject matter jurisdiction over the case when it denied plaintiff's motion to remand because the only parties to the case at the time of removal was plaintiff and Allstate Texas, both Texas residents. In this case, Allstate Illinois was not a defendant as originally filed and did not become a defendant through proper means.

Rountree v. Lopinto

Docket: 20-30111

Opinion Date: October 2, 2020

Judge: Jerry E. Smith

Areas of Law: Criminal Law

The Fifth Circuit affirmed the district court's dismissal of plaintiff's claim alleging that the seizure of his vehicle violated his clearly established constitutional rights under the Fourth Amendment. In this case, the officer investigating a hit-and-run incident came across one of the cars involved and seized it without obtaining a warrant. The court held that the warrantless seizure was constitutional, because there was probable cause to believe that the vehicle was an instrument or evidence of crime. Therefore, the officer is entitled to qualified immunity.

United States v. Fields

Docket: 19-10639

Opinion Date: October 2, 2020

Judge: Jerry E. Smith

Areas of Law: Criminal Law

The Fifth Circuit affirmed defendant's conviction for three firearms offenses, but vacated his sentence in part, remanding for amendment of the written judgment by removing an unpronounced special condition. The court held that the evidence was sufficient to support his conviction under an aiding-and-abetting theory of making false statements in connection with the acquisition of a firearm, as well as making false statements with respect to information that a licensed firearms dealer is required to keep in its records; the evidence was also sufficient to support his conviction of possession of a firearm and ammunition by a convicted felon; but the district court abused its discretion by including, in the written judgment, a special condition of supervised release that it omitted from the oral pronouncement of sentence.

United States v. Grogan

Docket: 18-50433

Opinion Date: October 2, 2020

Judge: Edith Brown Clement

Areas of Law: Criminal Law

The Fifth Circuit affirmed three conditions of supervised release imposed as part of defendant's sentence for aiding and abetting possession with intent to distribute methamphetamine and unlawful possession of a firearm. The court delayed hearing the appeal pending en banc consideration of United States v. Diggles, 957 F.3d 551 (5th Cir. 2020) (en banc), where the court held that a sentencing court pronounces supervision conditions when it orally adopts a document recommending those conditions. The court held that, in this case, the sentencing court's oral pronouncement of truncated versions was such an adoption. Here, after giving defendant notice of the proposed conditions in both the presentencing report and the standing order, it was clear that the district court adopted the full terms of those conditions orally at the sentencing hearing.

United States v. Sanchez Ochoa

Docket: 19-11181

Opinion Date: October 2, 2020

Judge: Andrew S. Oldham

Areas of Law: Criminal Law

A defendant cannot demand that his federal sentence run concurrently with a state sentence without establishing that both are premised on the same conduct. The Fifth Circuit affirmed defendant's offense, holding that the district court did not violate USSG 5G1.3(c) by failing to impose a concurrent sentence. In this case, defendant failed to present evidence that his state offense was part of the same course of conduct as the federal stolen mail offense. Nor did he present evidence that the offenses were part of a common scheme or plan. The court also held that defendant's within-Guidelines sentence was not substantively unreasonable and the district court did not abuse its discretion in sentencing defendant.