Fifth Circuit Review–Reviewed: Renewed!
As readers of Notice & Comment know, the Fifth Circuit has an active administrative law docket and often serves as a proving ground for cases on their way to the Supreme Court. This has been a regular column for the past few years, and I’m excited to take-up regular coverage and commentary on the court with this renewed Fifth Circuit Review-Reviewed!
To start things off, the court issued a couple of notable decisions and had an otherwise active schedule this past week. Several of these disputes involved frequent dance partners: the State of Texas and the federal government.
In Texas v. United States (No. 22-40367), the Fifth Circuit denied DHS’s request to stay the vacatur of a memorandum titled Guidelines for the Enforcement of Civil Immigration Law issued by Secretary Mayorkas last fall. The memo prioritizes the apprehension and removal of certain individuals who threaten national security (terrorists and spies), threaten public safety (those who have committed a serious crime), or threaten border security (those who were recently apprehended at the border after November 1, 2020). In June, Judge Tipton (S.D. Tex.) vacated the DHS memo after a two-day bench trial, finding that its guidelines violated sections of the Immigration and Nationality Act providing that DHS “shall” detain or remove individuals who have committed certain crimes and those subject to an order of removal. 8 U.S.C. §§ 1226(c), 1231(a). Both the district court and the Fifth Circuit appear to key in on the memo’s requirement that officers conduct “an assessment of the individual and totality of the circumstances” before determining whether someone poses a current threat to public safety and that officers “should not rely on the fact of conviction or the result of a database search alone.” DHS argued that Texas and Louisiana (the two plaintiff states) lacked standing and that memo’s guidelines were properly issued to meet the Secretary’s responsibility to set “national immigration enforcement policies and priorities” 6 U.S.C. § 202(5). In a per curiam opinion, issued by a panel consisting of Judges Jones, Clement, and Engelhardt, the Fifth Circuit rejected DHS’s standing arguments and its defenses of the memo’s legality finding that the memo is likely contrary to the INA, is arbitrary and capricious, and should have been subject to notice and comment before being issued. Focusing on standing, the court recognized its departure from the Sixth Circuit’s decision in Arizona v. Biden staying (and later reversing last week) a nationwide preliminary injunction blocking the DHS memo in an identical challenge brought by Arizona, Montana, and Ohio. Chief Judge Sutton, writing for the Sixth Circuit panel, found it speculative that the memo resulted in any increased costs or burdens on the states—including costs for medical and educational services and additional law enforcement burdens—and that any injunction blocking the memo could redress these indirect injuries. In distinguishing the Sixth Circuit’s stay order, the Fifth Circuit explained that those same asserted injuries could confer standing under its own controlling precedent—another case called Texas v. United States (No. 15-40238) where the court found that the costs in issuing driver’s licenses to DAPA beneficiaries provided Texas standing to challenge the program. The court also noted that it had the benefit of “fulsome facts-findings” after trial whereas the record before the Sixth Circuit was more limited. Yet, there appears to be tension in how the two courts viewed effect of the memo. Judge Sutton explained that “nothing in the Guidance . . . prohibits a single agent from detaining or removing a single person or for that matter any category of noncitizens identified in the two [sections of the INA].” But the Fifth Circuit determined that “the language found within [the memo] and the mechanisms of implementing it establish that it is indeed binding, thus removing DHS personnel’s discretion to stray from the guidance or take enforcement action against an alien on the basis of a conviction alone.” It looks like the Supreme Court will have a chance weigh-in with its view of the memo soon as DHS quickly filed an emergency application for a stay with the Court, following the Fifth Circuit’s decision. Unless that application is granted, DHS’s memo will remain vacated pending the appeal on the merits before the Fifth Circuit.
There were also two notable oral arguments last week in cases where Texas is up against the federal government.
First, in yet another Texas v. United States (No. 21-40680), the Fifth Circuit heard argument over the validity DHS’s 2012 memorandum establishing the DACA policy. Last July, Judge Hanen (S.D. Tex.) granted the state plaintiffs summary judgment, finding that DACA is procedurally unlawful because DHS failed to use notice-and-comment rulemaking and that the policy conflicts with the INA. The district court vacated the DACA memo and entered a nationwide permanent injunction, but the court temporarily stayed its injunction for existing DACA recipients pending appeal. The panel considering the appeal includes Chief Judge Richman along with Judges Ho and Engelhardt.
Second, the court also heard Texas v. EPA, a long running dispute where the state and other private parties have asked the Fifth Circuit to vacate EPA’s designation of areas in East Texas as failing to meet air quality standards for sulfur dioxide emissions. Under the Clean Air Act, EPA is required to assess regional air quality to determine if areas are meeting specific standards for various pollutants. Petitioners argue that EPA’s “nonattainment” designation was based on a faulty model, but EPA asserts it properly weighed those criticisms and determined that any error in the model did not apply to the East Texas areas. The panel for this argument included Judges King, Elrod, and Southwick.
Now for a case where the federal government was conspicuously absent, the Fifth Circuit issued its decision in Glenn v. Tyson Foods addressing the scope of federal officer removal under 28 U.S.C. § 1442(a)(1). Plaintiffs sued two Tyson facilities in Texas state courts claiming that they contracted COVID-19 while working at the plants at the beginning of the pandemic. The Tyson defendants removed invoking the federal officer statute because, among other factors, they claimed they were “acting under” the direction of a federal officer when they remained open throughout the pandemic to avoid a nationwide food shortage. However, Judge Willet (joined by Judges Engelhardt and Wilson) found that removal was improper because even though defendants and others designated as “critical infrastructure” were encouraged and exhorted to show up for work and to stay open during the pandemic by several federal officials, they were not directed to do so. The closest piece of evidence for the court was an executive order by President Trump invoking the Defense Production Act, which delegated authority to the Secretary of Agriculture to “take all appropriate action” under the DPA “to ensure that meat and poultry processors continue operations[.]” But the Secretary never used that authority, and the USDA made clear that the Secretary would only do so “if necessary.” Thus, the Fifth Circuit affirmed the district courts’ remand orders because defendants could not point to a direction from a federal officer requiring them to remain open.
One last case we are watching is Jarkesy v. SEC, as the government has asked the full Fifth Circuit to reconsider the panel decision by Judge Elrod (joined by Judge Oldham) holding (1) that the SEC violated a hedge fund manager’s Seventh Amendment right to a jury by imposing civil penalties for fraud through an administrative proceeding, (2) that the SEC’s “unfettered discretion” to enforce securities law violations through administrative proceedings or by suing in district court, violated the nondelagation doctrine, and (3) that the two layers of for-cause removal protection for SEC ALJs violated the Take Care Clause. Judge Davis dissented and disagreed with all three holdings. In its petition, the SEC emphasized that the panel left “uncertain how the Commission can proceed on remand” and “casts a cloud of uncertainty over the adjudications of all independent agencies that use ALJs.” The court has requested a response by July 18.
As a final note, I am grateful to the Yale Journal on Regulation for allowing me to carry on with Fifth Circuit Review–Reviewed and to Shane Pennington for originally starting this column and introducing me to the Notice & Comment team.
Brandon Duke is an appellate and complex commercial litigator at Winston & Strawn LLP. He also teaches Administrative Law at the University of Houston Law Center as an adjunct professor. Any views expressed are the author’s alone.