Take the Fifth

Designated for publication

• Keathley v. Buddy Ayers Construction, Inc., 24-60025, appeal from N.D. Miss.
  • Stewart, J. (Higginbotham, Stewart, Haynes) (no oral argument), judicial estoppel, personal tort
  • On remand from the U.S. Supreme Court, from prior Fifth Circuit affirmance of dismissal of plaintiff’s suit, remanding back to district court to assess judicial estoppel from plaintiff’s failure to disclose claim on bankruptcy schedules.
  • Thomas Keathley brought a personal injury lawsuit against Buddy Ayers Construction. The district court dismissed the case, and the Fifth Circuit previously affirmed, holding that Keathley’s failure to disclose the suit on his bankruptcy schedules barred his claims. Keathley petitioned for certiorari.
  • At issue on remand was whether the Fifth Circuit applied too narrow a standard in assessing whether Keathley’s omission of his personal injury suit from his bankruptcy schedules was the result of inadvertence or mistake (judicial estoppel). The case is remanded in its entirety to the district court in accordance with the Supreme Court’s judgment. The mandate shall issue forthwith.
  • The Supreme Court held that the Fifth Circuit erred by “artificially narrow[ing] its inquiry into whether Keathley’s bankruptcy-schedule omission was the result of inadvertence or mistake by assessing only whether he had knowledge of the underlying facts or a potential motive to conceal his personal-injury suit.” Keathley v. Buddy Ayers Constr., Inc., 146 S. Ct. 1532, 1540 (2026). The Fifth Circuit expressed “no view as to what proceedings the district court should conduct on remand or what decisions it should make.”

• Thompson v. McGehee, 25-10196, appeal from N.D. Tex.
  • Richman, J. (Elrod, Richman, Willett) (oral argument), First Amendment, sec. 1983, municipal liability
  • Reversing dismissal of plaintiff’s First, Fourth, and Fourteenth Amendment claims against arresting officers, reversing dismissal of First Amendment retaliation claims against all individual defendants, reversing the dismissal of her Monell claims against the City; and remanding the fabrication claim for consideration; but affirming the dismissal of her Fourth and Fourteenth Amendment claims against former Mayor McGehee and former interim Police Chief Cantrell.
  • Jennifer Thompson, a Godley, Texas, city councilwoman and vocal critic of the mayor and interim police chief, was arrested minutes before a city council meeting at which she planned to cast decisive votes. The arrest was based on a warrant charging her with misdemeanor tampering with a government record under Texas Penal Code § 37.10(a)(1), stemming from her adding proposed agenda items to a copy of the city council meeting agenda that bore the City Secretary’s digital signature. The arrest left the council deadlocked 2–2, allowing the Mayor to use his tiebreaking vote. The County Attorney declined to prosecute three days later. Thompson sued under 42 U.S.C. § 1983 asserting First, Fourth, and Fourteenth Amendment violations against the City of Godley and individual defendants. The district court dismissed all claims.
  • At issue on appeal was (1) whether the copy of the agenda Thompson edited was a “government record” under Texas Penal Code § 37.10(a)(1); (2) whether Thompson adequately pleaded a Fourth Amendment Franks false-arrest claim; (3) whether she adequately pleaded First Amendment retaliatory arrest claims; (4) whether her Monell claims against the City survived dismissal; and (5) whether her “abuse of process” claim should be construed as a fabrication-of-evidence claim.
  • The court held that the courtesy copy of the meeting agenda in Thompson’s email inbox was not a “government record” within the meaning of § 37.10(a)(1) because it was not “belonging to, received by, or kept by government for information.” The court reasoned: “To hold otherwise would make a misdemeanant out of many municipal employees. If any copy of a document created by a government official for an official purpose is a ‘government record,’ then proofreading and marking suggested edits for one’s colleague could be a crime.” The court declined to “construe the law to ‘make[] criminal activities which by modern standards are normally innocent.'”
  • Because the document was not a government record, the alleged misstatements in the warrant affidavit—characterizing the document as the “original,” referencing “forgery,” and calling it an “official record”—were material. Stripped of those assertions, “the affidavit describes utterly innocuous conduct: the drafting of a meeting agenda by individuals with differing views of what should be included.” Thompson therefore adequately pleaded a Franks claim (absence of probable cause), which also supported her First Amendment retaliatory arrest claim under the Mt. Healthy framework rather than the more demanding Nieves standard.
  • On the Monell claims, the court found that Thompson’s allegations—including former Police Chief Jordan’s documentation of a policy of targeting council members for their speech, direct threats to Thompson by officers, and the mayor’s directive to “find a way to ‘get it done'”—went beyond a single incident and adequately pleaded a persistent, widespread custom of retaliation.

• United States v. Kirkwood, 25-50171, appeal from W.D. Tex.
  • Southwick, J. (King, Southwick, Haynes) (oral argument), Haynes, J., dissenting; criminal, restitution
  • Vacating restitution award that was based on mental anguish alone.
  • James Kirkwood robbed a Dollar Tree in San Antonio, telling a 71-year-old cashier (A.C.) he had a gun. A.C. suffered no physical harm but experienced insomnia, nightmares, and anthropophobia, causing her to quit and take a lower-paying dishwasher job. The district court ordered $8,000 in restitution to A.C. under the Mandatory Victims Restitution Act (MVRA), 18 U.S.C. § 3663A, providing two alternative grounds: lost income and mental anguish. The court stated: “Well, we’ll make some new law, and Mr. Kirkwood can take it up if he wants to.” Kirkwood had signed an appeal waiver.
  • At issue on appeal was (1) whether the MVRA authorizes restitution for mental anguish absent bodily injury; (2) whether the MVRA authorizes lost-income restitution when the victim suffered no physical bodily injury; and (3) whether Kirkwood’s appeal waiver barred the challenge.
  • On de novo review, the court held that “bodily injury” under § 3663A(b)(2) unambiguously refers to physical injury. Dictionary definitions were “unanimous” that “bodily injury” pertains to the physical body, and the court noted that Black’s Law Dictionary defines “[b]odily condition” as the “[s]tatus of [the] human body at a given point in time as contrasted with state of mind.” The Government’s argument that “the brain is part of the body” was rejected: “Yes, the brain is part of the body, but the Government has not identified any authority that mental trauma should be considered trauma of the body.”
  • The court adopted a novel preservation rule: when the district court “sua sponte raises and explicitly resolves an issue of law on the merits,” the issue is preserved for de novo appellate review even absent a formal objection from the defendant. This was applied to the mental-anguish ground. On the lost-income ground, the court applied plain error review and still found for Kirkwood, noting overwhelming out-of-circuit authority and the Supreme Court’s holding in Castleman that bodily injury requires at least a common-law battery.
  • The court acknowledged that “it certainly is arguable that restitution should be available for victims such as A.C., but the statute would need to be revised to allow it.”
  • Judge Haynes dissented, contending the lost-income restitution order was not plainly erroneous given the absence of on-point Fifth Circuit precedent and the Seventh Circuit’s contrary holding in Breshers. Judge Haynes wrote: “I disagree with the majority opinion’s conclusion that the statutory language is so clear here that the restitution award was plainly erroneous, even in the absence of an on-point case.” She would have affirmed the restitution award.

• Local 1374, Jefferson Parish Firefighters Association v. Roberts, 25-30305, appeal from E.D. La.
  • Smith, J. (Higginbotham, Smith, Oldham) (oral argument), mootness, First Amendment
  • On basis that case was moot, vacating preliminary injunction and remanding to district court with instructions to dismiss for lack of jurisdiction.
  • Craig Burkett, a fire captain and Vice President of the Jefferson Parish Firefighters Association (the Union), also served on the Jefferson Parish Fire Civil Service Board (CSB). The Louisiana Board of Ethics issued opinions stating that the Union’s practice of paying for legal counsel for members appearing before the CSB violated state law so long as a Union officer served on the CSB. The Union sued in federal court, asserting a First Amendment violation, and the district court granted a preliminary injunction. On the eve of oral argument before the Fifth Circuit, the court learned that Burkett had resigned from the CSB.
  • At issue on appeal was whether Burkett’s resignation from the CSB mooted both the appeal and the entire case.
  • With no Union officer on the CSB, “there is no ongoing violation of the ethics ruling and no threat of enforcement from Louisiana. The Union is now free to pay for its members’ legal representation, as the ethics conflict under Louisiana law has been resolved.” Neither party retains a legally cognizable interest in the outcome.
  • The voluntary-cessation exception does not apply because the Union did not cause the mootness—”the only evidence suggests that Burkett stepped down of his own accord”—and Louisiana itself agreed the case was moot, unlike City of Erie v. Pap’s A.M., where the city had an ongoing enforcement interest.
  • The “capable of repetition yet evading review” exception also fails because there is no reasonable expectation the Union will be subjected to the same action again: “There is no evidence in the record that an officer of the Union ever held office on the CSB before Burkett, and there has been no indication that an officer of the Union intends to serve on the CSB again.”

Unpublished decisions

• In the Matter of Acis Capital Management, L.P., 25-10797, appeal from N.D. Tex.
  • Oldham, J. (Duncan, Oldham, Wilson) (oral argument), res judicata, employment
  • Affirming res judicata dismissal of plaintiff’s claims.
  • At issue was whether res judicata bars another round of litigation in the long-running dispute among Joshua Terry, Highland Capital Management, and James Dondero over Terry’s firing and related financial fallout—litigation the court likened to “refighting the Hundred Years’ War.”
  • The court held that res judicata does bar the claims, citing the extensive history of related proceedings spanning multiple years and courts.

• Ebem v. Blanche, 25-11150, appeal from N.D. Tex.
  • per curiam (Smith, Higginson, Wilson) (no oral argument), administrative law, due process, immigration
  • Affirming dismissal for lack of jurisdiction under the APA or the Mandamus Act to compel USCIS to adjudicate a long-pending I-485 petition; also at issue were whether the petitioner had a due process right to adjudication of an adjustment-of-status application; and whether the district court abused its discretion in denying a motion to amend the complaint.
  • The court held that 8 U.S.C. § 1252(a)(2)(B)(i) is a jurisdictional bar to review of discretionary adjustment-of-status decisions (even outside the removal context), that there is no protected liberty interest in adjustment of status supporting a due process claim, and that the district court did not err in denying the untimely motion to amend.

• United States v. Youngblood, 24-50982, appeal from W.D. Tex.
  • per curiam (Duncan, Oldham, Wilson) (oral argument withdrawn), criminal, sufficiency of evidence, jury instructions, sentencing
  • Affirmed wire fraud conviction.
  • At issue on appeal was (1) whether sufficient evidence supported the wire-fraud conviction where the wire transfer at issue followed, rather than preceded, the fraudulent payment; (2) whether the district court erred in refusing a proposed jury instruction on causation for wire fraud; and (3) whether a 480-month sentence—more than double the top of the Guidelines range—was substantively unreasonable.
  • The court found: (1) the wire transfer was “in furtherance of the scheme” because the defendant knew transfers would follow in the ordinary course of business; (2) the court’s jury instruction substantially covered the proposed defense instruction on causation; and (3) the above-Guidelines sentence was supported by fact-specific reasons—including the defendant’s cruelty to vulnerable victims, complete lack of repentance, pathological lying, and likelihood of re-offending.
  • Youngblood posed as a “Delta Force” veteran and former federal agent to defraud victims of their savings, claiming their loved ones were in danger from the Mafia or Mexican cartels; he gambled away over $140 million on Las Vegas slot machines. At sentencing, when the court expressed hope that Youngblood had been “reached by the expressions of pain of the people [he] victimized,” Youngblood interrupted to say “There isn’t” and voluntarily removed himself from the courtroom.

• United States v. Bello, 25-40772, appeal from E.D. Tex.
  • per curiam (Higginbotham, Engelhardt, Ramirez) (no oral argument), criminal, appellate jurisdiction
  • Dismissing as untimely appeal from amended restitution judgment.
  • At issue on appeal was (1) whether the court had jurisdiction over an appeal filed 29 days after entry of an amended restitution judgment (exceeding the 14-day criminal appeal deadline); and (2) whether the district court erred in summarily denying a motion to accept the late-filed notice of appeal without making findings on excusable neglect or good cause under Fed. R. App. P. 4(b)(4).
  • The appeal from the amended judgment was dismissed as untimely; all pending motions were denied as moot. However, the court remanded with instructions for the district court to determine whether excusable neglect or good cause warrants extending the filing deadline so that the notice of appeal may be deemed timely. The Fifth Circuit retained jurisdiction.

• United States v. Brown, 25-30034, appeal from W.D. La.
  • per curiam (Duncan, Oldham, Wilson) (oral argument withdrawn), criminal, guilty plea
  • Affirming guilty plea conviction of conspiracy to distribute or possess with intent to distribute 50 grams or more of methamphetamine, which had been challenged for a sufficient factual basis, reviewed for plain error because the defendant did not object below.
  • The court found no clear or obvious error. The record—including the stipulated factual basis, a DEA agent’s testimony, and the Presentence Report detailing large quantities of drugs, firearms, cash, and drug paraphernalia found in the defendant’s home, along with the defendant’s own admission—amply supported the factual basis for the guilty plea.

• United States v. Marascio, 25-40088, appeal from E.D. Tex.
  • per curiam (Duncan, Oldham, Wilson) (no oral argument), criminal, sufficiency of evidence, prosecutorial misconduct
  • Affirming conviction for conspiracy to commit wire fraud and money laundering in a Paycheck Protection Program (PPP) fraud scheme; also at issue was whether the prosecutor improperly commented on co-conspirator guilty pleas during closing argument.
  • On sufficiency, the court held that the evidence—Marascio obtained a $225,745 PPP loan based on false payroll claims, spent none on payroll, invested proceeds for personal gain, and recruited others for a fee—amply supported a finding of specific intent to defraud. On the prosecutor’s rhetorical question about why co-conspirators pleaded guilty, the court applied the four-factor test from United States v. Roland and found at least three factors favored the Government: the district court gave a limiting instruction, the statement served a proper evidentiary purpose (rebutting the defense theory that only the ringleader knew the scheme was illegal), and the pleas were mentioned only once. Even if the statement were improper, it did not substantially impair Marascio’s rights.