Fifth Circuit Denies Government's Motion to Stay Preliminary Injunction in Texas v. United States

This week, in State of Texas v. United States, the Court of Appeal for the Fifth Circuit determined that the United States (“government”) was unlikely to succeed on the merits of its appeal of the preliminary injunction handed down by a federal district court judge in Texas last February, and accordingly denied the government’s motion to stay -- and its request to narrow the scope of -- the injunction. In the view of two of the three judges on the panel, the government did not make the necessary showing that it was likely to succeed on its claim that the states lacked standing to maintain their actions.

Recall that 26 states sued to stop Deferred Action for Parental Accountability (DAPA) on the theories that 1) DAPA amounted to a substantive rule which did not comply with notice and comment requirements under the Administrative Procedures Act (APA), 2) even if the program had undergone the required notice and comment, it was substantively unlawful under the APA because the Secretary of the Department of Homeland Security (DHS) lacked authority for the program’s implementation, and 3) DAPA violated the the Take Care Clause of the Constitution, which requires the President to see that the laws be faithfully executed.

The district court found that the states had standing because they would suffer a financial injury when they incurred costs in issuing driver’s licenses to DAPA beneficiaries. Therefore, the district court granted the states’ request for a preliminary injunction on the procedural violation claim, without addressing the states’ other claims.

The government requested a stay of the preliminary injunction on the grounds that 1) the states lacked standing, 2) the states had no right to judicial review under the APA, and 3) that DAPA was not subject to the APA’s notice and comment procedure. The government also urged the panel to find that the district court’s order was an abuse of discretion because it was nationwide in its scope.

The panel agreed with the district court’s findings that the states would suffer an injury “fairly traceable” to DAPA. First, the Court reasoned that forcing states to choose between absorbing the administrative costs of issuing driver’s licenses to DAPA beneficiaries and raising fees to offset the additional costs constitutes an injury. The panel rejected the government’s argument that the costs of issuing licenses would be outweighed by the financial revenues prospectively to be generated by granting lawful presence to undocumented individuals, since any economic benefits that would be realized by the states would be too far removed from the process of issuing driver’s licenses to ameliorate the costs associated with transacting those licenses.

The Court concluded that DAPA would be the “substantial cause” of the injury to the states, as beneficiaries of the program would be entitled to apply for driver’s licenses, and that the injury would be “redressable by a favorable ruling.” Moreover, the states had shown that the interests they were seeking to protect were within the zone of interest of the Immigration and Nationality Act (INA), i.e., denying state benefits to undocumented individuals. The government, in the view of the panel, failed to overcome the strong presumption favoring judicial review of the DAPA program; in particular, the panel concluded that the INA did not impose a jurisdictional limitation on court review and that the states’ lawsuit seeking to enforce rights under the APA was consistent with congressional intent allowing states to refuse to make certain benefits available to undocumented individuals.

Although the government argued that DAPA was a form of prosecutorial discretion shielded from judicial review, the panel disagreed, observing that the program created a mechanism for a class of individuals to become lawfully present and thereby qualify for state and federal benefits for which they would not otherwise be eligible. The panel could locate no statutory basis for DAPA that would insulate the program from judicial review.

Furthermore, the Court of Appeal characterized the DHS Secretary’s authority to grant work permits under DAPA as an “affirmative action” that “remains an open question.” Significantly, the Court of Appeal concluded that the district court did not err in determining that DAPA was a substantive rule which required the government to adhere to the APA’s notice and comment procedures -- and not merely a statement of policy relating to use of agency resources which enjoyed exemption from the APA’s requirements.

In other words, the government failed to show that the district court had erred in finding that the discretionary language in DAPA, particularly when viewed through the prism of a high approval rate for applicants under the existing Deferred Action for Childhood Arrivals (DACA), was simply a pretext for reclassifying the status of unlawfully present individuals to “lawfully present” in a class-wide fashion.

Considerations of procedural efficiency aside, held the panel, DAPA established a mechanism for hundreds of thousands of persons to invoke a substantive right, e.g., lawful presence and eligibility for work authorization, thereby forcing the states to elect between subsidizing the costs of issuing drivers licenses or changing their fee structure through a change in their laws.

The panel concluded that the United States would not be irreparably harmed if the government’s request for a stay was denied and that the “public interest favors maintenance of the injunction.”

Finally, the panel rejected the government’s argument that the nationwide scope of the injunction should be narrowed, observing that a limitation of the injunction’s scope would defeat the federal interest in maintaining a uniform system of laws respecting immigration.

In my next blog post I will analyze the dissenting opinion of Judge Stephen A. Higginson.

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