City of Austin v. Paxton

• Decision Date: 04 December 2019
• Docket Number: No. 18-50646,18-50646
• Citation: 943 F.3d 993
• Parties: CITY OF AUSTIN, Plaintiff-Appellee v. Ken PAXTON, Attorney General of the State of Texas; Texas Workforce Commission, Defendants-Appellants
• Court: U.S. Court of Appeals — Fifth Circuit

943 F.3d 993

CITY OF AUSTIN, Plaintiff-Appellee

v.Ken PAXTON, Attorney General of the State of Texas; Texas Workforce Commission, Defendants-Appellants

No. 18-50646

United States Court of Appeals, Fifth Circuit.

FILED December 4, 2019

Patricia L. Link, Hannah Vahl, Esq., City of Austin, Law Department, Litigation Division, Austin, TX, for Plaintiff-Appellee.

Lisa Bennett, Assistant Solicitor General, Office of the Attorney General for the State of Texas, Lanora Christine Pettit, Office of the Attorney General, Office of the Solicitor General, Austin, TX, for Defendants-Appellants.

Before CLEMENT, ELROD, and DUNCAN, Circuit Judges.

EDITH BROWN CLEMENT, Circuit Judge:

The City of Austin enacted a housing ordinance that prohibits landlords from refusing tenants who wish to pay their rent with federal housing vouchers. Shortly thereafter, the State of Texas enacted a statute that sought to invalidate the City’s ordinance and to allow landlords to continue to refuse federal vouchers. The City then sued Ken Paxton, the Texas Attorney General, and the Texas Workforce Commission (together, the "State"), seeking to enjoin the Texas statute, alleging it was preempted by federal law. The State moved to dismiss the complaint for lack of jurisdiction based on standing and Eleventh Amendment sovereign immunity and for the City’s failure to state any plausible claims. The district court denied the State’s motion, holding that the City had standing, and that the City’s suit could proceed against Attorney General Paxton and the Texas Workforce Commission under the Ex parte Young exception to sovereign immunity. The State then brought this interlocutory appeal with respect to the district court’s sovereign-immunity holding only. Because Attorney General Paxton does not possess the requisite "connection to the enforcement" of the Texas statute to satisfy Ex parte Young , and because the Texas Workforce Commission is a state agency immune to suit, we REVERSE and REMAND to the district court.

I.

The Federal Housing Choice Voucher Program (the "voucher program" or the "program") allows low-income families to use federally-funded vouchers to access the private rental market. The United States Department of Housing and Urban Development ("HUD") funds the program, but state and local public-housing authorities administer it. A voucher recipient is responsible for finding a landlord that will accept federal housing vouchers. See 24 C.F.R. § 982.302(a).

In December 2014, the City adopted a housing ordinance (the "Ordinance"), that bars landlords from refusing to rent to tenants paying their rent with program vouchers. The City contends that the Ordinance helps to "remove barriers to fair housing choice by allowing voucher holders ... [to rent] housing in higher opportunity neighborhoods in the City." The City asserts that enacting the Ordinance is part of its obligation under the voucher program’s mandate: "[the program was created] [f]or the purpose of aiding low-income families in obtaining a decent place to live and of promoting economically mixed housing." 42 U.S.C. § 1437f(a).

In response to the Ordinance, the Texas legislature enacted Texas Local Government Code § 250.007 to prevent municipalities and counties from adopting ordinances that restrict landlords’ rights to refuse to rent to voucher program participants. Section 250.007(a) bars municipalities or counties from "adopt[ing] or enforc[ing] an ordinance or regulation that prohibits [a landlord] ... from refusing to lease or rent [a] housing accommodation to a person because the person’s lawful source of income to pay rent includes funding from a federal housing assistance program." TEX. LOC. GOV’T CODE § 250.007(a). Section 250.007(c) permits municipalities and counties to create incentive and other programs that encourage landlords to allow federal housing vouchers. Id. § 250.007(c).

The City originally sued the State of Texas and Greg Abbott, the Governor of Texas, alleging that federal law preempts § 250.007 because § 250.007 "obstructs [Congress’s] purposes and objectives" in creating the voucher program. The State of Texas moved to dismiss the proceeding for (i) lack of subject-matter jurisdiction based on standing and sovereign immunity, and (ii) the City’s failure to state any plausible claims. The City then amended its complaint, replacing Governor Abbott with Ken Paxton, the Texas Attorney General, in his official capacity, and the Texas Workforce Commission.

The district court denied the State’s motion to dismiss for lack of jurisdiction, rejecting the State’s standing and sovereign-immunity arguments. The court dismissed the City’s conflict-preemption claim and one of its express-preemption claims but denied the State’s motion to dismiss the City’s second express-preemption claim. The issue in this interlocutory appeal is whether Attorney General Paxton and the Texas Workforce Commission are subject to the Ex parte Young exception to Eleventh Amendment sovereign immunity.

II.

We review the district court’s jurisdictional determination of sovereign immunity de novo. NiGen Biotech, L.L.C. v. Paxton , 804 F.3d 389, 393 (5th Cir. 2015) ; Moore v. La. Bd. of Elementary & Secondary Educ. , 743 F.3d 959, 962 (5th Cir. 2014).

III.

In most cases, Eleventh Amendment sovereign immunity bars private suits against nonconsenting states in federal court. See Va. Office for Prot. & Advocacy v. Stewart , 563 U.S. 247, 253, 131 S.Ct. 1632, 179 L.Ed.2d 675 (2011) ("Sovereign immunity is the privilege of the sovereign not to be sued without its consent."); see also Bd. of Trs. of Univ. of Ala. v. Garrett , 531 U.S. 356, 363, 121 S.Ct. 955, 148 L.Ed.2d 866 (2001) ("The ultimate guarantee of the Eleventh Amendment is that nonconsenting [s]tates may not be sued by private individuals in federal court."). The Supreme Court has recognized that sovereign immunity also prohibits suits against state officials or agencies that are effectively suits against a state. See, e.g. , Edelman v. Jordan , 415 U.S. 651, 663-69, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974) (extending sovereign immunity to state officers in their official capacities); Ford Motor Co. v. Dep’t of Treas. , 323 U.S. 459, 463-64, 65 S.Ct. 347, 89 L.Ed. 389 (1945) (barring suits in which the state is a real party in interest, despite not being a named defendant). In short, Eleventh Amendment immunity is not limited to cases in which states are named as defendants. So, unless the state has waived sovereign immunity or Congress has expressly abrogated it, the Eleventh Amendment bars the suit. See AT&T Commc’ns v. Bellsouth Telecomms. Inc. , 238 F.3d 636, 644-45 (5th Cir. 2001).

Enter the Ex parte Young exception to Eleventh Amendment sovereign immunity, which was established in its namesake case. See 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908). The Young exception is a legal fiction that allows private parties to bring "suits for injunctive or declaratory relief against individual state officials acting in violation of federal law." Raj v. La. State Univ. , 714 F.3d 322, 328 (5th Cir. 2013). For the exception to apply, the state official, "by virtue of his office," must have "some connection with the enforcement of the [challenged] act, or else [the suit] is merely making him a party as a representative of the state, and thereby attempting to make the state a party." Young , 209 U.S. at 157, 28 S.Ct. 441. The text of the challenged law need not actually state the official’s duty to enforce it, although such a statement may make that duty clearer. Id.

The Supreme Court’s recent Ex parte Young jurisprudence explains that the inquiry into whether a suit is subject to the Young exception does not require an analysis of the merits of the claim. See Verizon Md., Inc. v. Pub. Serv. Comm’n , 535 U.S. 635, 646, 122 S.Ct. 1753, 152 L.Ed.2d 871 (2002). Rather, "a court need only conduct a ‘straightforward inquiry into whether [the] complaint alleges an ongoing violation of federal law and seeks relief properly characterized as prospective.’ " Va. Office , 563 U.S. at 255, 131 S.Ct. 1632 (alteration in original) (quoting Verizon , 535 U.S. at 645, 122 S.Ct. 1753 ).

It is undisputed that Texas has not consented to this suit and that Congress has not abrogated the State’s immunity. The question, then, is whether the defendants are subject to suit under the Ex parte Young exception.

A. Ken Paxton, Texas Attorney General

We begin with whether the district court was correct in holding that Attorney General Paxton was subject to the Young exception. In conducting our Ex parte Young analysis, we first consider whether the plaintiff has named the proper defendant or defendants. Where a state actor or agency is statutorily tasked with enforcing the challenged law and a different official is the named defendant, our Young analysis ends. For example, in Morris v. Livingston , an inmate in the custody of the Texas Department of Criminal Justice ("TDCJ") sued the Governor of Texas, challenging the constitutionality of a statute that required TDCJ inmates to pay a "health care services fee" if an inmate initiated a visit to a health care provider. 739 F.3d 740, 742 (5th Cir. 2014). The statute specifically tasked the TDCJ as responsible for its enforcement. Id. at 745-46. Thus, a panel of this court held that the Governor was an improper defendant and upheld the district court’s dismissal of the inmate’s claims against him. Id. at 746 ("[The challenged statute] makes clear that TDCJ is the agency responsible for the section’s administration and enforcement .... It does not [ ] task [the] Governor [ ] with its enforcement."). Where no state official or agency is named in the statute in question, we consider whether the state official actually has the authority to enforce the challenged law. Here, the State concedes in its brief that the Attorney General has the authority to enforce § 250.007 : "[T]he Attorney General does have the power to enforce this provision [...