Take the Fifth

Designated for publication

• East Fork Enterprises, Inc. v. EPA, 24-60227, c/w 24-60256, petition for review of EPA action
  • Jones, J. (Higginbotham, Jones, Southwick) (no oral argument), Toxic Substances Control Act, administrative law
  • Granting industry petitioner’s petition for review of EPA rule, vacating rule, and remanding to EPA.
  • Methylene chloride (MC) is a volatile chemical solvent widely used in adhesives, automotive products, and paint removers. EPA determined that nearly all uses of MC pose an “unreasonable risk of injury to health” under the Toxic Substances Control Act (TSCA) and promulgated a rule that effectively eliminated the market for MC by prohibiting 40 of 53 identified conditions of use and imposing strict exposure limits on the remaining 13. Industry petitioners East Fork Enterprises, Epic Paint Company, and the American Chemistry Council challenged the rule as exceeding EPA’s authority, while the Sierra Club filed a separate petition arguing EPA did not go far enough.
  • At issue on the petition was whether EPA lawfully adopted a “whole chemical” risk determination rather than evaluating unreasonable risk for each individual condition of use; whether EPA’s assumption that workers do not wear personal protective equipment (PPE) was legally and factually supported; whether EPA’s exposure limits were supported by substantial evidence; whether EPA properly regulated “to the extent necessary” to eliminate unreasonable risk; and whether the Sierra Club’s challenges regarding fenceline communities, genetic cancer susceptibility, and ozone depletion had merit.
  • The court granted the Industry Petitioners’ petition for review, vacated EPA’s MC Rule and associated risk determination, denied the Sierra Club’s petition for review, and remanded to EPA for further proceedings.
  • The court held that the TSCA’s text unambiguously requires EPA to evaluate unreasonable risk for each separate “condition of use,” not on a “whole chemical” basis. The statute mentions “conditions of use” in no fewer than thirteen subsections, and EPA’s own procedural rules had long required individual risk determinations for each condition of use—a mandate EPA violated when it switched to a whole-chemical approach in its November 2022 revised risk determination. EPA’s related assumption that workers do not wear PPE was “contrary to law, arbitrary and capricious, and lacked substantial evidence,” since PPE is plainly a “condition of use” and EPA’s own 2020 risk evaluation had found, based on reasonably available information, that workers do use PPE consistent with longstanding OSHA requirements.
  • On the science, the court found that EPA’s acute exposure limit of 16 ppm (versus OSHA’s 125 ppm) rested on exclusive reliance on a single study of twelve people showing only a temporary 7% decrease in peripheral vision—a “precursor” to harm, not an adverse health effect itself—while discounting contradictory studies. Likewise, EPA’s chronic exposure limit of 2 ppm (versus OSHA’s 25 ppm) relied exclusively on a single rat study while ignoring three “acceptable” human epidemiological studies showing no significant liver effects even at exposures many times higher. The court quoted its precedent: “it is not good science to rely on a single experiment.” The court concluded that “EPA’s approach seems to mirror its risk assessments under statutes that require the agency to remove virtually all risks,” inconsistent with the TSCA’s “unreasonable risk” standard, which “does not incorporate any precautionary principle.”
  • Regarding EPA’s near-total ban on MC, the court held that EPA impermissibly shifted the burden to regulated entities to prove compliance, failed to adequately consider alternatives and economic consequences, and relied on speculative justifications for prohibition rather than showing regulation was only “to the extent necessary” to eliminate unreasonable risk. As for the Sierra Club, the court found EPA reasonably excluded fenceline air and water exposure pathways where the science was undeveloped, rejected the ozone-depletion claim for lack of Article III standing due to its “highly attenuated chain of possibilities,” and found EPA adequately addressed cancer risks to genetically susceptible populations.

• In re Highland Capital Management, L.P. (NexPoint Real Estate Partners v. Highland Capital Management), 25-11185, appeal from N.D. Tex.
  • Graves, J. (Stewart, Graves, Wilson) (oral argument), bankruptcy, sanctions
  • Affirming bankruptcy court’s sanctions order against creditor.
  • During the Chapter 11 bankruptcy of Highland Capital Management, HCRE Partners (now NexPoint Real Estate Partners), a company controlled by James Dondero, filed a proof of claim asserting that SE Multifamily Holdings’ organizational documents mistakenly apportioned its membership and seeking reformation of the LLC agreement. At trial, both Dondero and McGraner—HCRE’s officers who orchestrated the underlying transactions—admitted that the LLC agreement “comport[ed] with [their] expectations” and could not identify any part that did not reflect the parties’ intent. HCRE also frivolously opposed a motion to disqualify its counsel, Wick Phillips, by misrepresenting the firm’s prior role, and then sought to withdraw its claim two days before officers’ depositions while seeking to preserve the claim’s substance for a future forum. The bankruptcy court sanctioned HCRE $825,940.55 under its inherent powers for bad faith.
  • At issue on appeal was whether clear and convincing evidence supported the bankruptcy court’s finding that HCRE acted in bad faith, and whether the sanction amount was causally related to HCRE’s sanctionable conduct.
  • The court found clear and convincing evidence that HCRE filed its claim in bad faith: Dondero signed the proof of claim under penalty of perjury without doing any due diligence, and both officers later admitted at trial that the LLC agreement reflected the parties’ actual intent—meaning the claim was baseless from the start. The trial revealed an “ulterior motive”: McGraner testified the real “mistake” was Dondero filing Highland’s bankruptcy, which prevented them from freely amending organizational documents to dilute Highland’s membership and shield SE Multifamily’s assets from creditors.
  • The court also found bad faith in HCRE’s litigation conduct. HCRE knowingly misrepresented Wick Phillips’s prior joint representation of both HCRE and Highland—”a misrepresentation that took six months of expensive litigation to disprove. This goes beyond opposing a motion and losing; this is knowingly raising, then standing by, a frivolous argument—classic bad faith.” The withdrawal motion’s timing—two business days before Dondero’s and McGraner’s depositions—was “indeed suspicious,” and HCRE “never offered a cogent explanation for the timing” and failed to submit a proposed dismissal order as directed by the court.
  • On the sanction amount, the court rejected HCRE’s argument that fees incurred after its withdrawal motion were not causally related to its misconduct. HCRE’s own failure to propose withdrawal language caused the denial of the motion, and Highland ultimately obtained through trial what HCRE could have resolved: “an ironclad guarantee that HCRE cannot challenge its interest in SE Multifamily again; whether in a bankruptcy court, or any other forum.”

• Harward v. City of Austin, 25-50160, appeal from W.D. Tex.
  • Willett, J. (Willett, Engelhardt, Douglas) (oral argument), Pullman abstention, mootness, Fourteenth Amendment
  • Reversing district court’s order abstaining from property owners’ challenge to city ordinance subjecting them to full taxation, and remanding.
  • Several owners of shoreline properties along Lake Austin sued the City of Austin over a 2019 ordinance that declared their properties had always been within the City’s full-purpose jurisdiction, repealed a 1986 ordinance designating those properties as limited-purpose, and subjected them to full taxation. The Homeowners alleged that the City taxes them as full-purpose residents but denies them the services that go with that status. The case had been pending since January 2021 and was making its second trip to the Fifth Circuit; on the first appeal, the court reversed dismissal under the Tax Injunction Act. On remand, the district court abstained under Pullman without reaching the City’s other grounds for dismissal.
  • At issue on appeal was whether the case was rendered moot by Texas Senate Bill 1844, which provides a statutory disannexation mechanism; and whether Pullman abstention was appropriate where the Homeowners’ federal equal-protection claim does not depend on a disputed question of Texas law.
  • The court rejected the City’s mootness argument, noting that S.B. 1844 expressly provides no refund of previously paid taxes and does not provide for automatic disannexation. The City itself had “rejected 31 Homeowners’ valid requests for disannexation,” so those Homeowners retain a concrete financial stake in the 2019 Ordinance’s validity.
  • On Pullman abstention, the court held that the doctrine requires both a federal constitutional challenge to state action and a genuinely “difficult and unsettled” question of state law whose resolution would make the federal question unnecessary. The court emphasized that Pullman “sets a high bar—and does so on purpose,” that “[a]bstention is not appropriate simply because no state court has yet provided a definitive answer,” and that “[i]f ordinary interpretive tools yield a discernible answer, the law is not uncertain.” Whatever the disputed 1986 Ordinance means under Texas law, “the Homeowners’ equal-protection claim does not turn on it”: “whether Texas law required the City to provide those services is a different question from whether the Fourteenth Amendment lets the City tax without providing them.”
  • The court declined to address the merits of the equal-protection claim and directed the district court on remand to resolve the remaining undecided defenses—the political-question doctrine, Burford abstention, and Rule 12(b)(6)—”together, rather than send this case back to us one threshold issue at a time.”

• Navarro Ramirez v. Guerrero, 25-70010, appeal from S.D. Tex.
  • Higginson, J. (Stewart, Haynes, Higginson) (oral argument), Haynes, J., dissenting; habeas corpus, ineffective assistance of counsel
  • Denying certificate of appealability from denial of habeas on IAC and involuntary-confession claims.
  • Juan Raul Navarro Ramirez, a Texas death-row inmate, was convicted of capital murder in 2004 for his role in a multi-victim robbery homicide in Hidalgo County known as the “Edinburg massacre.” The primary evidence against him was a recorded confession in which he admitted participating in a gang robbery and being handed an AK-47. Ramirez had an extensive juvenile record documenting depression, PTSD, and suicide attempts beginning around age ten, but his trial counsel failed to get these TYC records admitted through the business-records hearsay exception, resulting in the exclusion of potentially mitigating evidence at sentencing. A codefendant, Bocanegra, later submitted a 2019 sworn declaration admitting that he—not Ramirez—was “Lenny,” the person who had committed certain acts originally attributed to Ramirez.
  • At issue on the COA application was whether Ramirez was entitled to a certificate of appealability (COA) on his claims that (1) trial counsel was constitutionally ineffective for failing to admit juvenile mental-health records under the business-records exception, and (2) the state trial court erred in admitting his recorded confession as involuntary.
  • On Claim 1, the majority found that Ramirez’s business-records theory of ineffective assistance was not the theory presented in his operative habeas petition and was first raised in a combined reply brief and cross-motion for summary judgment. The district court declined to consider it on procedural grounds, and Ramirez did not challenge that procedural ruling on appeal. Because he failed to show “that jurists of reason would find it debatable whether the district court was correct in its procedural ruling,” the COA was denied.
  • On Claim 4(H), Ramirez argued for the first time in objections to the magistrate judge’s report that newly presented evidence—Bocanegra’s declaration and an updated expert report from Dr. Deborah Davis on false-confession vulnerability—rendered his voluntariness claim “unexhausted” and thus subject to de novo rather than deferential AEDPA review. The majority held that “issues raised for the first time in objections to an R&R are not properly before the district court” and therefore declined to address the new exhaustion theory.
  • Judge Haynes dissented, contending that the COA threshold is a “mere threshold inquiry, not a full merits analysis” and that “in capital cases, doubts as to whether a COA should issue must be resolved in favor of the petitioner.” On Claim 1, Judge Haynes argued that reasonable jurists could debate whether Ramirez met his burden under Martinez v. Ryan and Trevino v. Thaler to show state habeas counsel was ineffective, noting that Ramirez’s lead federal habeas counsel called state counsel’s failure to present trial counsel’s evidentiary blunder “inexplicable,” and that a co-defendant convicted as a “captain and leader” of the same gang was granted habeas relief on the same type of TYC-evidence claim.
  • On Claim 4(H), Judge Haynes contended that the new evidence—Bocanegra’s declaration admitting he was “Lenny” and Dr. Davis’s updated report documenting Ramirez’s enhanced vulnerability to interrogative pressure and false confession—”casts doubt on the veracity of Ramirez’s confession—the primary evidence used against him.” Judge Haynes would have found the district court abused its discretion in not construing Ramirez’s objection as a motion to amend his petition, “[g]iven the nature of the penalty in a capital case.”

Unpublished decisions

• United States v. Claiborne, 25-10419, appeal from N.D. Tex.
  • per curiam (Jones, Ho, Wilson) (no oral argument), criminal
  • Granting Anders motion to withdraw, and dismissing appeal.

• United States v. Gonzales-Molina, 25-10812, appeal from N.D. Tex.
  • per curiam (Smith, Southwick, Oldham) (no oral argument), criminal
  • Affirming denial of motion to dismiss indictment for illegal reentry.
  • Gonzales-Molina appealed the denial of his motion to dismiss an indictment for unlawful reentry under 8 U.S.C. § 1326(a), (b)(2), seeking to collaterally attack the underlying removal order. Reviewing de novo, the court held that he failed to satisfy any of the three statutory requirements for a collateral attack under 8 U.S.C. § 1326(d)—exhaustion of administrative remedies, improper deprivation of judicial review, and fundamental unfairness of the removal order.

• Anderton v. Dallas Independent School District, 25-11351, appeal from N.D. Tex.
  • per curiam (Jones, Ho, Wilson) (no oral argument), employment discrimination, Title VII, Age Discrimination in Employment Act
  • Affirming summary judgment for school district on employment discrimination claims.
  • Dr. Amy Anderton, a sixty-year-old white woman, sued DISD alleging race discrimination under Title VII and age discrimination under the ADEA after being terminated for policy violations related to her unauthorized contact with foster-care students. The district court granted summary judgment to DISD. On de novo review, the Fifth Circuit applied the McDonnell Douglas burden-shifting framework, assumed arguendo that Anderton established a prima facie case, and found DISD articulated a legitimate, non-discriminatory reason (policy violations). The court held that Anderton failed to raise a genuine dispute of material fact on pretext, finding that the purported inconsistencies between DISD’s investigation report and its summary judgment evidence amounted to mere differences in vocabulary, not material shifts in the stated reasons for termination.

• United States v. Tillman, 25-11364, appeal from N.D. Tex.
  • per curiam (Jones, Ho, Wilson) (no oral argument), criminal
  • Granting Anders motion to withdraw, and dismissing appeal.

• United States v. Sefcik, 25-11366, appeal from N.D. Tex.
  • per curiam (Stewart, Richman, Higginson) (no oral argument), criminal, sentencing
  • Affirming 12-month sentence on revocation of supervised release.
  • Sefcik appealed the revocation of his supervised release and the 12-month within-guidelines sentence, arguing the district court should have applied the 18 U.S.C. § 3583(d) treatment exception instead of mandatory revocation under § 3583(g) in light of his multiple failed drug tests. Without resolving whether Sefcik preserved the issue, the court held his claim failed even under the more lenient abuse-of-discretion standard, noting the district court had accurately stated the law, previously granted the treatment exception, and implicitly rejected a return to treatment after Sefcik continued to violate supervision terms.

• Bales v. Houston Independent School District, 25-20487, appeal from S.D. Tex.
  • per curiam (Smith, Haynes, Engelhardt) (oral argument), First Amendment, equal protection, due process, qualified immunity
  • Affirming dismissal of claims against school district and principal on First Amendment, equal protection, due process, and retaliation claims.
  • Leslie and Bryan Bales sued HISD and a school principal under 42 U.S.C. § 1983, alleging violations of the First Amendment Free Speech Clause, the Fourteenth Amendment Due Process and Equal Protection Clauses, and retaliation, arising from incidents at Lamar High School. The district court dismissed under Rule 12(b)(1) and (6), finding, inter alia, that Mr. Bales lacked standing, Ms. Bales failed on qualified immunity for the viewpoint-discrimination claim, no racially discriminatory intent was shown for equal protection, no due process violation occurred, the retaliation claims would not have chilled speech, HISD was not liable absent officer liability, and ratification was insufficiently alleged. Leave to amend was denied as too conclusory.

• Bello v. United States, 25-40385, appeal from E.D. Tex.
  • per curiam (Jones, Ho, Engelhardt) (no oral argument), prisoner suit
  • Dismissing as frivolous appeal from denial of federal prisoner’s mandamus petition.
  • Federal prisoner Bello sought leave to proceed IFP on appeal from the denial of his mandamus petition under 28 U.S.C. § 1361. The court found that Bello failed to meaningfully address the district court’s reasons for denying the petition and had thus abandoned the critical issue on appeal, rendering the appeal without arguable merit. The court also warned Bello that future repetitive or frivolous filings could result in sanctions.

• Caro v. City of Brownsville, 25-40668, appeal from S.D. Tex.
  • per curiam (Stewart, Richman, Higginson) (no oral argument), sec. 1983, municipal liability
  • Affirming dismissal of pro se plaintiff’s Fourth, Fifth, and Fourteenth Amendment claims, a § 1983 claim, and an ADA claim against the City of Brownsville and its police officers based on an allegedly excessive use of force during an arrest. The district court dismissed claims against the officers in their official capacities as duplicative of the city claims, dismissed the city claims for failure to identify a specific municipal policy, and dismissed the ADA claim for failure to state a viable claim. On appeal, the pro se plaintiff failed to challenge these holdings or explain how he stated a plausible claim for relief, thereby waiving his arguments.

• In re Quintana, 25-50530, appeal from W.D. Tex.
  • per curiam (Richman, Duncan, Ramirez) (no oral argument), bankruptcy
  • Dismissing as frivolous appeal from denial of motion to reopen bankruptcy proceedings.
  • Quintana sought IFP status to appeal the district court’s order affirming the bankruptcy court’s denial of his motion to reopen bankruptcy proceedings. The Fifth Circuit found Quintana failed to challenge the district court’s determinations that res judicata barred his collateral attack on the underlying bankruptcy orders and that his arguments were statutorily moot under 11 U.S.C. § 363(m). The court declined to consider new arguments and evidence raised for the first time on appeal and characterized his allegations of clerk misconduct as “nonsensical and wholly frivolous.”

• United States v. Lazo-Bonilla, 25-50901, appeal from W.D. Tex.
  • per curiam (Elrod, Southwick, Ramirez) (no oral argument), criminal, sentencing
  • Affirming 24-month sentence on conviction of illegal reentry.
  • Lazo-Bonilla challenged the substantive reasonableness of his above-guidelines 24-month sentence following a guilty plea to illegal reentry after removal. The court held the district court did not abuse its discretion, finding the upward variance was justified by the defendant’s prior illegal-reentry convictions and underrepresented criminal history, and that no unwarranted sentencing disparity was shown.

• United States v. Garza-Ruiz, 25-50924, appeal from W.D. Tex.
  • per curiam (Higginbotham, Jones, Oldham) (no oral argument), criminal, sentencing
  • Affirming 36-month sentence on conviction of illegal reentry.
  • Garza-Ruiz pleaded guilty to illegal reentry under 8 U.S.C. § 1326(a) and (b) and was sentenced to 36 months—an upward variance from the 8-to-14-month guidelines range. For the first time on appeal, he argued the sentence was substantively unreasonable. Reviewing for plain error, the court found no clear error in the district court’s balancing of the § 3553(a) factors.

• ReJoyce Foundation v. Armbrust & Brown, P.L.L.C., 25-50988, appeal from W.D. Tex.
  • per curiam (Jones, Ho, Wilson) (no oral argument), sec. 1983
  • Affirming dismissal of pro se litigant’s twelve-count complaint—asserting § 1983, equal protection, due process, conspiracy, Title VI, First Amendment, and other claims against a law firm, multiple judges, an insurance company, and state entities—and the imposition of a pre-filing injunction.
  • The case stemmed from Henderson’s attempts to relitigate a multi-million-dollar state court default judgment arising from a deceptive property and insurance scheme. Henderson had been declared a vexatious litigant in state court and had filed at least four related federal suits and over 100 motions and filings in the case below. The Fifth Circuit held the district court did not abuse its discretion in dismissing the claims as frivolous under 28 U.S.C. § 1915(e)(2)(B) or in imposing the pre-filing injunction. The court also noted Rooker-Feldman doctrine concerns and denied all pending motions.

• De Quesada v. Field Office Director, ICE Houston, 26-20122, appeal from S.D. Tex.
  • per curiam (Smith, Stewart, Southwick) (no oral argument), habeas corpus, mootness
  • Dismissing as moot appeal from denial of immigration detainee’s sec. 2241 petition.
  • De Quesada, a Cuban national, appealed the denial of his 28 U.S.C. § 2241 habeas petition seeking release from immigration detention and related injunctive and declaratory relief. Because De Quesada had already been removed from the United States, the relief requested could not be granted.

• United States v. Efferson, 26-30053, appeal from W.D. La.
  • per curiam (Stewart, Richman, Higginson) (no oral argument), criminal, sentencing
  • Affirming 360-month sentence on conviction of conspiracy to possess with intent to distribute methamphetamine and was sentenced within guidelines to 360 months plus five years of supervised release.
  • On appeal, defendant challenged (1) the district court’s finding that he was a leader or organizer under U.S.S.G. § 3B1.1(a), (2) the substantive reasonableness of his sentence, and (3) its constitutionality under the Eighth Amendment. The court held the leader/organizer finding was not clearly erroneous, the substantive-reasonableness challenge was barred by the appeal waiver, and the sentence was not unconstitutionally excessive.

• Albert v. Calsoft, Inc., 26-50492, appeal from W.D. Tex.
  • per curiam (Jones, Ho, Wilson) (no oral argument), employment discrimination, Title VII
  • Affirming the dismissal of employment discrimination claims.
  • Pro se plaintiff Albert, a Pakistani national, sued Calsoft under Title VII alleging national-origin discrimination after not being selected for an engineering position. The district court dismissed for failure to state a claim because the complaint did not allege that non-Pakistani applicants were treated differently, and it denied leave to amend as futile. The Fifth Circuit held that while Albert need not produce evidence at the pleading stage, he must still plead sufficient facts to make a disparate-treatment claim plausible, and his original complaint and proposed amendment—which added only a formulaic recitation of an element of the Title VII cause of action—failed to allow an inference of discrimination beyond pure speculation.

• Alemu v. Blanche, 26-60086, petition for review of BIA order
  • per curiam (Jones, Ho, Wilson) (no oral argument), immigration
  • Denying Ethiopian citizen’s petition for review of BIA’s decision upholding the denial of asylum, withholding of removal, and CAT protection.
  • The Fifth Circuit held that substantial evidence supported the agency’s adverse credibility determination, which was based on discrepancies regarding whether a friend provided medical assistance, whether police held Alemu’s wife at gunpoint, the demolition of a store, and a prior visa application. The agency was not required to accept Alemu’s explanations for the discrepancies. The BIA also did not err in finding Alemu ineligible for humanitarian asylum given his failure to demonstrate past persecution credibly, and the generalized country-conditions evidence was insufficient to compel a conclusion that Alemu would more likely than not be tortured if returned to Ethiopia.