Case: 21-10302 Document: 00516409307 Page: 1 Date Filed: 07/27/2022
United States Court of Appeals
for the Fifth Circuit
United States Court of Appeals
Fifth Circuit
FILED
July 27, 2022
No. 21-10302 Lyle W. Cayce
Clerk
Victor Leal; Patrick Von Dohlen; Kim Armstrong,
Plaintiffs—Appellants,
versus
Xavier Becerra, Secretary, U.S. Department of Health
and Human Services; Janet Yellen, Secretary, U.S.
Department of Treasury; Martin Walsh, Secretary,
U.S. Department of Labor; United States of America;
Kent Sullivan; Texas Department of Insurance,
Defendants—Appellees.
Appeal from the United States District Court
for the Northern District of Texas
USDC No. 2:20-CV-185-Z
Before Jolly, Higginson, and Engelhardt, Circuit Judges.
Per Curiam:*
Plaintiffs-Appellants challenged the Affordable Care Act (“ACA”),
its derivative Contraceptive Mandate, and the Texas Contraceptive Equity
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
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Law (“TCEL”). They claimed that these laws restrict the health-insurance
market so that insurers cannot feasibly offer health-insurance plans that
Plaintiffs-Appellants find acceptable. Thus, it was “impossible” for
Plaintiffs-Appellants to obtain the health-insurance plans they seek.
Defendants-Appellees filed a motion to dismiss. The district court held that
Plaintiffs-Appellants had standing, dismissed Plaintiffs Victor Leal and
Patrick Von Dohlen under the doctrine of res judicata, held that Plaintiff Kim
Armstrong had stated an Appointments Clause claim,1 and dismissed
Armstrong’s nondelegation claim. Leal v. Azar, No. 2:20-CV-185-Z, 2020
WL 7672177, at *23 (N.D. Tex. Dec. 23, 2020), judgment entered sub nom. Leal
v. Becerra, No. 2:20-CV-185-Z, 2021 WL 1163663 (N.D. Tex. Mar. 26, 2021).
The district court also dismissed Texas from the case on sovereign immunity
grounds and, in the alternative, “decline[d] to exercise its supplemental
jurisdiction over the state-law claims.” Id.
The sole issue Plaintiffs-Appellants raise on appeal is their challenge
to the ACA. Because our opinion in DeOtte v. Nevada, 20 F.4th 1055 (5th Cir.
2021), renders res judicata inapplicable, and because the absence of Texas
from this appeal implicates unaddressed standing issues, we VACATE and
REMAND for further proceedings.
I
In 2018, a group of plaintiffs sued to enjoin the Contraceptive
Mandate. DeOtte, 20 F.4th at 1062. After certifying a class that included
religious objectors, the district court in DeOtte issued an injunction in favor
of that class. Id. at 1063. The district court in this case held that because Leal
and Von Dohlen are members of the class certified in DeOtte, and the claims
in both cases arise from the same nucleus of operative facts, they could have
1
Armstrong later stipulated dismissal of this claim with prejudice.
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brought their instant claims in that proceeding. Leal, 2020 WL 7672177, at
*7; id. at *8 n.9. Thus, their claims were barred under the doctrine of res
judicata. Id. at *7.
We need not decide whether the district court was correct because res
judicata is no longer applicable. Res judicata requires that “the prior action
was concluded by a final judgment on the merits.” Hous. Pro. Towing Ass’n v.
City of Houston, 812 F.3d 443, 447 (5th Cir. 2016) (cleaned up). Because this
court has vacated the final judgment in DeOtte and remanded with
instructions to dismiss that case as moot, there is no longer a final judgment
on the merits and res judicata is inapplicable. DeOtte, 20 F.4th at 1071.
II
We next turn to standing. At the time the district court ruled on
Defendants-Appellees’ motion to dismiss, both the Contraceptive Mandate
and the TCEL were being challenged in this case. But after the district court
dismissed Texas as a defendant, Plaintiffs-Appellants declined to appeal that
dismissal. The issues before this court therefore concern only Plaintiffs-
Appellees’ claims against the federal government. As briefing and oral
argument have made clear, this implicates standing problems that the district
court did not have occasion to consider. Thus, we vacate the judgment of the
district court and remand for further proceedings.
Article III of the Constitution of the United States requires that courts
only adjudicate “Cases” and “Controversies,” which, among other things,
means that the party or parties invoking federal jurisdiction must have
standing to sue. Lujan v. Defs. of Wildlife, 504 U.S. 555, 559 (1992). In order
to demonstrate standing, a party must establish: 1) that it has suffered an
injury in fact that is concrete and particularized and is actual or imminent
rather than conjectural or hypothetical, 2) that there is a causal connection
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between the injury and the defendants’ conduct (i.e., traceability), and 3) that
a favorable decision is likely to redress the injury. Id. at 560–61.
When multiple laws cause the same harm, that injury may not be
traceable or redressable when only one of those laws is challenged.
Traceability requires causation, so “[o]ne law alone does not cause the injury
if the other law validly outlaws all the same activity.” 13A Charles Alan
Wright et al., Federal Practice and Procedure § 3531.5 (3d
ed. 2008 & Supp. 2021). Redressability is also a problem when declaring one
law unenforceable may not provide relief because a different law
independently causes the same injury. See Fischer v. Governor of New Jersey,
842 F. App’x 741, 750–51 (3d Cir. 2021) (citing 15 Moore’s Federal
Practice § 101.42 (2020) (“[T]he redressability element . . . is not
satisfied if a favorable result would eliminate one of multiple causes of an
injury without actually decreasing the injury at all.”)); Fischer, 842 F. App’x
at 751 n.11 (gathering cases). These difficulties have been recognized by the
Supreme Court and several sister circuits. Renne v. Geary, 501 U.S. 312, 319
(1991) (finding it doubtful that an injury caused by a California constitutional
provision could be redressed when a separate California statute that could
cause the same injury was unchallenged); see, e.g., Kaspersky Lab, Inc. v.
DHS, 909 F.3d 446, 465 (D.C. Cir. 2018) (holding that an injury caused by
an agency action was not redressable when a federal statute prohibited the
same conduct); White v. United States, 601 F.3d 545, 552–53 (6th Cir. 2010)
(holding that traceability and redressability were not satisfied when plaintiffs
challenged a federal ban on cockfighting but not state laws prohibiting the
same); San Diego Cnty. Gun Rts. Comm. v. Reno, 98 F.3d 1121, 1130 (9th Cir.
1996) (holding that an injury was not traceable to the challenged federal
statute when it was also traceable to a state statute).
But this rule, like most, has exceptions and exclusions. In Renne, the
Supreme Court noted that the “invalidation of one [offending law] may not
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impugn the validity of another” in the context of that case, so redressability
was doubtful. Renne, 501 U.S. at 319. Consistent with that reasoning, this
court has recognized that when the “fates” of the law at issue and other
causative laws are “intertwined,” plaintiffs may have standing to challenge
one but not the other. Hollis v. Lynch, 827 F.3d 436, 442 (5th Cir. 2016).
Further, the general rule is inapplicable when a state invokes one law as the
basis for an enforcement action and the injured party challenges only that law,
despite the existence of some other law that could also be used to justify the
government’s action. In that situation, plaintiffs have standing because they
are challenging “the sole basis” of one “discrete injury,” the injury that
“gave rise to the present suit.” Larson v. Valente, 456 U.S. 228, 241–43
(1982); see State v. Rettig, 987 F.3d 518, 528–29 (5th Cir. 2021) (applying
Larson in the federal context).
The district court did not have the opportunity to consider these cases
because the issue was not present while Texas, and the TCEL, remained in
the suit. Since the ground has shifted in the wake of Texas’s dismissal, we
remand so that the district court may consider the standing issue with the
benefit of amended pleadings and new argument from the parties.2
III
This case has changed dramatically since it left the district court. After
DeOtte, res judicata is inapplicable. After Plaintiffs-Appellants abandoned
their challenge to the TCEL—at least in this court—a standing issue has
2
This remand due to changed circumstances does not foreclose application of any
other threshold jurisdictional obstacles that the parties and the district court may raise. For
example, the parties disputed the relevance and applicability of California v. Texas, 141 S.
Ct. 2104 (2021), on appeal. The district court may also wish to consider whether Plaintiff-
Appellant Armstrong’s alleged injury, increased health insurance cost, is a generalized
grievance in light of Hotze v. Burwell, 784 F.3d 984, 995 (5th Cir. 2015).
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come to the fore despite taking a back seat in the parties’ briefing. Thus, we
VACATE and REMAND to ensure that the case as it now stands is fully
ventilated and that the district court has a chance to take the new status quo
into account.3 To that end, Plaintiffs-Appellants should be permitted to
amend their complaint to reflect that they have abandoned their claims
against Texas.
3
Although Plaintiffs-Appellants also appealed the district court’s dismissal of
Armstrong’s non-delegation claim, we cannot consider it unless Armstrong has standing.
Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 110 (1998). Since we have remanded
standing to the district court, the merits go with it.
6