Take the Fifth

Designated for publication

• Estate of Fields v. Commissioner of Internal Revenue, 25-60403, appeal from U.S. Tax Court
  • Duncan, J. (King, Higginson, Duncan) (no oral argument), tax law
  • Granting motion to modify original panel opinion rendered June 8, 2026, and substituting new opinion that likewise affirmed tax court’s judgment upholding imposition of estate-tax liability and assessment of 20% negligence penalty.
  • Anne Milner Fields, a businesswoman diagnosed with Alzheimer’s in 2011, had her great-nephew Bryan Milner serve as agent under a power of attorney. In May–June 2016, as Fields’s health precipitously declined—she suffered a heart attack, a spine fracture, and was declared “end stage” Alzheimer’s—Milner rapidly formed a limited partnership (AM Fields, LP) and transferred approximately $17 million of Fields’s assets into it. Fields was placed in hospice on June 15 and died on June 23, 2016. The Estate filed a tax return valuing its partnership interest at roughly $11 million rather than the $17 million in transferred assets, reducing the gross estate by about $6 million. The IRS assessed a deficiency and a 20% accuracy-related penalty.
  • At issue on appeal was (1) whether the transfer of assets into the limited partnership qualified for the “bona fide sale for adequate and full consideration” exception under I.R.C. § 2036(a), which required showing a substantial non-tax purpose; and (2) whether a 20% negligence penalty under I.R.C. § 6662 was proper.
  • The Estate advanced three non-tax justifications—remedying POA deficiencies, consolidating asset management, and protecting against elder abuse—but the court rejected each. The claimed POA succession problem was “unfounded” because the partnership’s own documents would not have solved it either, and Milner successfully transferred $17 million using only the POA, belying claims that institutions refused to honor it. The consolidation argument failed because the assets were “of a disparate character, promised no obvious synergies with each other,” were not working business interests requiring active management, and were already professionally managed. The elder-abuse protection rationale was undercut by Milner’s waiting several years after the abuse incidents to form the partnership.
  • The court highlighted six “troublesome” supporting facts, including the compressed timeline (partnership formed and funded with $17 million in roughly three weeks before Fields’s death), the absence of any discussion of a partnership until Fields’s health crisis, and attorney Jamie Katzen’s email seeking a “deeper discount” from an appraiser.
  • On the penalty, the court found the $6 million reduction in reportable assets “should have struck ‘a reasonable person in Mr. Milner’s position as very possibly too good to be true,'” especially given his education in finance. The Estate failed to show that any professional actually advised it that reporting the discounted partnership interest was proper; merely engaging professionals did not suffice to establish reasonable cause.

• MIECO L.L.C. v. Targa Gas Marketing L.L.C., 23-20567, appeal from S.D. Tex.
  • per curiam (Elrod, Higginbotham, Southwick) (oral argument), breach of contract, certification
  • Revising panel decision issued July 24, 2026, with revised opinion that likewise affirmed preliminary injunction of Texas social media regulation statute as to monitoring and filtering requirements as preempted by federal law; vacated injunction as sought by certain plaintiffs for lack of standing; certified questions to the Texas Supreme Court; and denied en banc rehearing for failure of any active judge to call for a poll.
  • MIECO and Targa, natural gas buyers and sellers, operated under a standard NAESB-form base contract. During Winter Storm Uri (February 15–20, 2021), Targa failed to deliver the contractually required 45,000 MMBtu of gas per day, invoking the contract’s force majeure clause. Before the storm, Targa—a marketing company that produces no gas itself—had been satisfying its obligations by purchasing from affiliates and from the daily/spot market (roughly 29% from non-affiliates, buying from 25 to 50 entities daily). The district court granted Targa partial summary judgment, holding Targa had no obligation to purchase replacement gas on the spot market during the force majeure event.
  • At issue on appeal was whether the NAESB standard-form contract’s force majeure provisions required a non-producer seller that had previously purchased gas on the spot market to continue doing so during a force majeure event, and how “reasonable efforts” should be defined.
  • The court’s original opinion had determined that “gas supply” under Section 11.3(v) encompassed the sources from which Targa had actually been purchasing—including the spot market—meaning Targa could not invoke force majeure to excuse a failure to buy from those same sources during the storm. Targa’s petition for rehearing, supported by an amicus, argued the decision “unsettled the expectations on which the providers of natural gas operate” and involved interpretation of a standard-form contract that “governs the entire natural gas industry in Texas.”
  • The court concluded certification was appropriate because the issue is “close,” there are “insufficient state law authorities,” and the answer is “of importance to a significant Texas industry and to those who rely on it.” The court acknowledged that delay is “extensive already” but stated that “getting the answer right is critical.”
  • The two certified questions are: (1) whether the NAESB form contract’s force majeure provisions require a non-producer seller to enter the spot market during a force majeure event if it had been using the spot market as part of its gas supply; and (2) if so, how “reasonable efforts” to provide gas from the spot market should be defined.

• Bay Area Unitarian Universalist Church v. Ogg, 23-20165, appeal from S.D. Tex.
  • En banc (13-3; Jones, J., joined by Elrod, C.J., and Willett, J., as to judgment and all parts except Part III.B; joined by Southwick, J., as to judgment and as to Parts III.A and III.C; joined by Ramirez, J., as to judgment and all parts except Parts III.B and III.C; joined by Richman and Haynes, JJ., as to judgment only; and joined as to all parts by Smith, Stewart, Duncan, Engelhardt, Oldham, and Wilson, JJ.); Willett, J., concurring (joined by Elrod, C.J.); Higginson, J., dissenting; Douglas, J., dissenting (joined by Graves, Higginson, JJ.); Ho, J., recused and not participating in decision (though he did participate in en banc oral argument) (oral argument); First Amendment, standing, en banc
  • After April 9, 2025, panel opinion (Jones, Dennis, Douglas; Jones, J., dissenting) reversing the district court’s dismissal of the plaintiffs’ First Amendment challenge to Texas’s handgun trespass statutes, the en banc court instead affirmed the dismissal.
  • A Houston coffee shop and a Unitarian Universalist church near Houston challenged Texas Penal Code §§ 30.06 and 30.07, which criminalize trespass by licensed handgun carriers only if the property owner provides “effective notice” via specific statutorily prescribed signs—bilingual, in contrasting colors, with block letters at least one inch high. Plaintiffs objected to the signs as burdensome, ugly, and intimidating, preferring to communicate their no-firearms policies more simply. The district court dismissed for lack of Article III standing. A divided panel reversed.
  • At issue on appeal was whether property owners have Article III standing—injury in fact, traceability, and redressability—to challenge the heightened signage requirements of the Texas criminal trespass statutes on First Amendment grounds.
  • On traceability, Judge Jones’s en banc majority opinion held that the defendants (law enforcement officials) do not “cause” plaintiffs’ injuries; the statutes do not coerce plaintiffs’ conduct, and nothing enforceable against plaintiffs is prohibited by the challenged provisions. “[I]t isn’t just what the defendants allegedly don’t do here that annoys the plaintiffs, but what the law doesn’t do. Either way, their claims fail.” On redressability, the court found that federal courts cannot rewrite state criminal statutes and that enjoining the notice provisions would leave an undefined, “ambiguous reference to ‘written communication'” vulnerable to vagueness challenges. On injury, the court found multiple theories—asymmetric treatment, unconstitutional conditions, compelled speech, monetary cost, and reputational harm—all “dubious,” noting that plaintiffs “are not compelled to post the prescribed signs in order to eject licensed gun carriers from their premises” because they may use oral notice, cards, or simply call the police.
  • The majority emphasized practical reality: the Webster Police Chief confirmed officers respond to trespass calls regardless of signage, and the church administrator confirmed police always responded to their calls. The court analogized the situation to a property owner who objects to a 30 mph speed limit and noted: “law enforcement does not ’cause’ a ‘violation’ of the property owner’s rights by not ticketing drivers going 28 mph.”
  • Judge Willett, joined by Chief Judge Elrod, concurred, finding that all three standing elements are lacking but parting ways on redressability analysis. Judge Willett wrote that the majority conflates “whether relief should issue” with the proper redressability question: “whether the requested relief, if granted, would remedy the plaintiffs’ injury.” He would find redressability lacking because plaintiffs never explained what an injunction could order defendants to do, and any declaratory judgment would have no preclusive effect in future trespass prosecutions involving non-parties.
  • Judge Higginson dissented, invoking Justice Cardozo and writing: “This case asked us to harmonize conflicting fundamental rights—liberty and property—to the best of our ability. Instead, the majority chose justiciability.” Judge Higginson contended that the right to exclude is “pre-constitutional, foundational to property rights, and vital to individual rights,” and that requiring three specific large signs to exclude handgun carriers imposes an unconstitutional burden. Judge Higginson found traceability satisfied because “Defendants’ enforcement of Texas’s criminal trespass laws traces to Plaintiffs’ injury,” and redressability met because declaring laws unconstitutional and enjoining enforcement “are two judicial functions well within our authority.”
  • Judge Douglas, joined by Judges Graves and Higginson, also dissented, writing separately to detail errors in the majority’s injury, traceability, and redressability analyses. She highlighted that Antidote Coffee previously communicated its no-firearms policy with “a three-inch pictograph that cost virtually nothing” but now must display “signs covering approximately ten square feet of its front window, at a cost of $260.” Judge Douglas contended that the asymmetric regulatory treatment is a cognizable injury “regardless of whether the plaintiff suffers any additional, more tangible harm,” relying on Davis v. FEC and Time Warner Cable v. Hudson. On traceability, she wrote that injuries resting on the “predictable effect of Government action on the decisions of third parties” satisfy Article III, quoting Department of Commerce v. New York. Judge Douglas concluded: “If asymmetric regulatory treatment of speech is not a cognizable injury when the government directs formal enforcement at third parties, then a broad category of discriminatory regulatory schemes will be immunized from judicial review.
• [Just for kicks, here’s my observations and hunch as to outcome after the en banc argument in January.]

Unpublished decisions

• Adams v. Baldwin, 26-50187, appeal from W.D. Tex.
  • per curiam (Jones, Ho, Engelhardt) (no oral argument), prisoner suit
  • Dismissing as frivolous appeal from Texas state prisoner’s § 1983 claims.

• United States v. Dixon, 25-60710, appeal from S.D. Miss.
  • per curiam (Elrod, Smith, Stewart) (no oral argument), criminal
  • Granting Anders motion to withdraw, and dismissing appeal.

• In re Robinson, 26-60048, appeal from S.D. Miss.
  • per curiam (Wiener, Willett, Wilson) (no oral argument), bankruptcy
  • Affirming dismissal of bankruptcy court judgment.
  • At issue on appeal was whether the district court erred in dismissing pro se appellants’ appeal of a bankruptcy court judgment after the appellants failed to follow proper procedures for perfecting their appeal. The Robinsons raised jurisdictional and constitutional claims, including alleged violations of the Full Faith and Credit Clause.
  • The court found that the district court properly instructed the Robinsons on the procedure for pursuing an appeal, which the Robinsons disregarded. Review of the record and the district court’s judgment revealed no reversible error.

• Jefferson v. Johnson, 25-11275, appeal from N.D. Tex.
  • per curiam (Stewart, Richman, Haynes) (no oral argument), Rooker-Feldman doctrine, res judicata, election law
  • Dismissing as frivolous appeal from dismissal of pro se suit challenging disqualification from ballot.
  • At issue on appeal was whether pro se plaintiffs—who were disqualified from a 2023 Dallas municipal election ballot—could proceed IFP on appeal of a dismissal grounded on the Rooker-Feldman doctrine and res judicata. The appellants also challenged the district court’s alleged failure to allow amendment under Rule 15 and its handling of their objections and post-judgment motion.
  • IFP motions denied and appeal dismissed as frivolous. The court concluded that the Jeffersons failed to make the requisite showing that they would present a nonfrivolous issue for appeal.