Veritext Corp. v. Bonin

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

VERITEXT CORP., ET AL. CIVIL ACTION

VERSUS NO. 16-13903

C/W 17-9877

REF: ALL CASES

PAUL A. BONIN, ET AL. SECTION “B”(2)

ORDER AND REASONS

Before the Court are defendants’ motion for reconsideration

of this Court’s Order and Reasons at Record Document 263 (Rec.

Doc. 265), plaintiffs’ response in opposition (Rec. Doc. 267),

defendants’ reply in support of their motion for reconsideration

(Rec. Doc. 272), plaintiffs’ sur-reply in opposition to

defendants’ motion for reconsideration (Rec. Doc. 274), and

defendants’ sur-reply in support of their motion for

reconsideration (Rec. Doc. 277).

For the reasons discussed below,

IT IS ORDERED that defendants’ motion for reconsideration (Rec.

Doc. 265) is DENIED.

I. FACTS AND PROCEDURAL HISTORY

On February 25, 2019, this Court consolidated plaintiff

Esquire Deposition Solutions, LLC (“Esquire”) and plaintiff

Veritext Corporation’s actions against defendants John J. Lee,

Jr.,1 Vincent P. Borrello, Jr., Milton Donegan, Jr., Suzette Magee,

Kimya M. Holmes, John H. Anderssen, May F. Dunn, Elizabeth C.

Methvin, and Laura Putnam. See Rec. Doc. 91. Veritext and Esquire

are both Delaware corporations providing court-reporting services

to clients across the United States, including in Louisiana. Rec.

Docs. 1 at 5, 117 at 5. Both companies also consume court reporting

services in Louisiana. Id. Plaintiffs provide negotiated rates and

discounts for court reporting services to frequent customers who

agree to utilize plaintiffs’ services for all or some of their

court reporting needs. Rec. Doc. 117 at 8.

Defendants are current and former members of the Louisiana

Board of Examiners of Certified Shorthand Reporters (“Board”),

which is a regulatory body created “for the purpose of encouraging

proficiency in the practice of shorthand reporting as a profession,

promoting efficiency in court and general reporting, and . . .

establishing a standard of competency for those persons engaged in

it.” LA. STAT. ANN. § 37:2551(A) (2021). The Board is authorized to

enforce Louisiana Code of Civil Procedure Article 1434, the

provision under scrutiny in this matter, which prohibits

a person who has a contractual relationship with a party

litigant to provide shorthand reporting or other court

reporting services . . . [or] a person employed part or

full time under contract or otherwise by a person who

has a contractual relationship with a party litigant to

1 On January 11, 2019, the Court granted plaintiffs’ motion to substitute John

J. Lee, Jr., in his official capacity as a member of the Louisiana Board of

Examiners of Certified Shorthand Reporters, for Paul A. Bonin. Rec. Doc. 89.

provide shorthand reporting or other court reporting

services.

LA. CODE CIV. PROC. ANN. art. 1434(A)(2) (2021); see also Rec. Doc.

117 at 6, 17.

In 2012, the Board began enforcing Article 1434 against all

court reporters who entered into volume-based discount contracts

with party litigants. Id. at 13. Plaintiffs consequently brought

Constitutional claims under the dormant Commerce Clause and the

Fourteenth Amendment, as well as a claim under Section 1 of the

Sherman Act, 15 U.S.C. § 1. Rec. Docs. 1, 4. The Court dismissed

plaintiffs’ constitutional challenges, and subsequently dismissed

the Sherman Act claim on reconsideration. Veritext Corp. v. Bonin,

259 F. Supp. 3d 484 (E.D. La. 2017), on reconsideration, 2017 WL

3279464 (E.D. La. Aug. 2, 2017). On appeal, the Fifth Circuit

confirmed the dismissal of Veritext’s Constitutional claims but

reversed the dismissal of its Sherman Act claim because it found

that “Veritext pled facts sufficient to support a finding that the

Board’s conduct does indeed restrain trade.” Veritext Corp. v.

Bonin, 901 F.3d 287, 292 (5th Cir. 2018). Additionally, the Court

held that the Board members were not entitled to Parker immunity

because the active supervision requirement of that doctrine was

“not met.” Id.; see also Parker v. Brown, 317 U.S. 341, 351 (1943).

Plaintiffs then filed a motion for partial summary judgment

on the affirmative defenses of unclean hands, in pari delicto,

indemnification, contribution, and allocation of fault. Rec. Docs.

229, 231, 234. The Court granted summary judgment for the

affirmative defenses of unclean hands and allocation of fault and

dismissed as moot the affirmative defenses of in pari delicto,

indemnification, and contribution. Rec. Docs. 237, 238. Defendants

next filed a motion for reconsideration of plaintiffs’ motion for

summary judgment, which the Court denied on October 22, 2021. Rec.

Docs. 240, 242, 246, 262. Shortly after their motion for

reconsideration, defendants filed a motion to dismiss for lack of

subject matter jurisdiction, which this Court also denied on

December 1, 2021. Rec. Docs. 247, 250, 253, 263. Defendants then

filed the instant motion for reconsideration. Rec. Doc. 265.

II. LAW AND ANALYSIS

A. Motion for Reconsideration Standard

Federal Rule of Civil Procedure 54(b) provides the district

court with “the inherent procedural power to reconsider, rescind,

or modify an interlocutory order for cause seen by it to be

sufficient.” Castrillo v. Am. Home Mortg. Servicing, Inc., No. 09-

4369, 2010 WL 1424398, at *3 (E.D. La. Apr. 5, 2010) (quoting

Melancon v. Texaco, Inc., 659 F.2d 551, 553 (5th Cir. 1981)). The

district court’s discretion is broad when determining whether a

motion for reconsideration has merit; however, “it is exercised

sparingly in order to forestall the perpetual reexamination of

orders and the resulting burdens and delays.” Id. (citing 18b

Charles A. Wright & Arthur Miller, Federal Practice and Procedure

§ 4478.1 (2d ed. 2002)). “The general practice of courts in the

Eastern District of Louisiana has been to evaluate Rule 54(b)

motions to reconsider interlocutory orders under the same

standards that govern Rule 59(e) motions to alter or amend a final

judgment.” Hoffman v. Bailey, No. 13-5153, 2015 WL 9315785, at *7

(E.D. La. Dec. 23, 2015).

A Rule 59(e) motion “calls into question the correctness of

a judgment.” In re Transtexas Gas Corp., 303 F.3d 571, 581 (5th

Cir. 2002). Rule 59(e) serves “the narrow purpose of allowing a

party to correct manifest errors of law or fact or to present newly

discovered evidence.” Atchafalaya Basinkeeper v. Bostick, 663 F.

App’x 291, 294 (5th Cir. 2016) (quoting Waltman v. Int’l Paper

Co., 875 F.2d 468, 473 (5th Cir. 1989)). Amending a judgment is

appropriate under Rule 59(e): “(1) where there has been an

intervening change in the controlling law; (2) where the movant

presents newly discovered evidence that was previously

unavailable; or (3) to correct a manifest error of law or fact.”

Berezowsky v. Ojeda, 652 F. App'x 249, 251 (5th Cir. 2016) (quoting

Demahy v. Schwarz Pharma, Inc., 702 F.3d 177, 182 (5th Cir. 2012)).

Because Rule 59(e) has a “narrow purpose,” the Fifth Circuit has

observed that “[r]econsideration of a judgment after its entry is

an extraordinary remedy that should be used sparingly.” Templet v.

HydroChem Inc., 367 F.3d 473, 479 (5th Cir. 2004). Thus, a motion

for reconsideration “is not the proper vehicle for rehashing

evidence, legal theories, or arguments that could have been offered

or raised before the entry of judgment.” Id. “When there exists no

independent reason for reconsideration other than mere

disagreement with a prior order, reconsideration is a waste of

judicial time and resources and should not be granted.” Ferraro v.

Liberty Mut. Ins. Co., No. 13-4992, 2014 WL 5324987, at *1 (E.D.

La. Oct. 17, 2014).

B. Whether Plaintiffs Must Allege Article 1434 Itself

Violates Federal Law

Defendants initially argue that “when a claim against a state

official is based on the enforcement of a statute, Young does not

apply, unless the statute being enforced is itself

unconstitutional or violates federal law.” Rec. Doc. 265-1 at 2.

Consequently, they assert that “applying Young hinges on whether

Article 1434 violates federal law.”2 Id. The Court finds no support

for the assertion that plaintiffs must allege that Article 1434

2 Defendants state this Court’s previous ruling “was based on the erroneous

finding that (according to Plaintiffs’ allegations) Article 1434 violates the

Sherman Act.” Rec. Doc. 265-1 at 5. To clarify, the Court never found that

Article 1434 violates the Sherman Act. See generally Rec. Doc. 263. All the

Order includes is that “plaintiffs claim an ongoing violation of federal law”

and that “[plaintiffs] assert that the Board members’ enforcement of [Article

1434] violates the Sherman Act.” Id. at 8. The Order does state that the Fifth

Circuit’s “affirmation of plaintiffs’ Sherman Act claim confirms plaintiffs’

right to seek relief for an ongoing violation of that Act.” Id. at 9. But in

doing so, it does not suggest that plaintiffs’ Sherman Act claims succeed on

the merits, only that plaintiffs “have alleged facts sufficient to make a prima

facie Sherman Act claim.” Id. at 8 (citing Veritext Corp., 901 F.3d at 292).

itself violates federal law for the Ex parte Young exception to

apply.

“For Young to apply, three criteria must be satisfied: (1) A

plaintiff must name individual state officials as defendants in

their official capacities; (2) the plaintiff must allege an ongoing

violation of federal law; and (3) the relief sought must be

properly characterized as perspective.” Green Valley Special Util.

Dist. v. City of Schertz, Tex., 969 F.3d 460, 471 (5th Cir. 2020)

(citations omitted). Defendants believe “the second prong was

erroneously applied.” Rec. Doc. 265-1 at 2. However, Supreme Court

and Fifth Circuit case law dictates that as long as plaintiffs

allege that the actions of state officials, in their official

capacity, violate federal law, that allegation is sufficient for

the Young exception to apply. See, e.g., Verizon Md., Inc. v. Pub.

Serv. Comm’n of Md., 535 U.S. 635, 645-46 (2002); Idaho v. Coeur

d’Alene Tribe of Idaho, 521 U.S. 261, 281 (1997) (“An allegation

of an ongoing violation of federal law where the requested relief

is prospective is ordinarily sufficient to invoke the Young

fiction.”); Frew ex rel. Frew v. Hawkins, 540 U.S. 431, 437 (2004)

(“[T]he Eleventh Amendment permits suits for prospective

injunctive relief against state officials acting in violation of

federal law.”); Mayfield v. Tex. Dept. of Crim. Just., 529 F.3d

599, 604 (5th Cir. 2008) (quoting McCarthy ex rel. Travis v.

Hawkins, 381 F.3d 407, 412 (5th Cir. 2004)) (“Under Ex Parte Young,

a federal court, consistent with the Eleventh Amendment, may enjoin

state officials to conform their future conduct to the requirements

of federal law.”). Cory v. White, a case defendants cite, even

seems to support this concept when it plainly states “the Eleventh

Amendment bars suits against state officers unless they are alleged

to be acting contrary to federal law or against the authority of

state law.” 457 U.S. 85, 91 (1982).

Many cases that include enforcement related injunctive relief

do allege that the underlying state statute is unconstitutional or

violates federal law, but this type of allegation does not appear

to be a requirement. See, e.g., Am. Bank & Tr. Co. of Opelousas v.

Dent., 982 F.2d 917, 921 (5th Cir. 1993) (noting that challenging

a state law as unconstitutional “is common in Young cases,” but

never stating this type of challenge is required). For example, in

NiGen Biotech, L.L.C. v. Paxton, the Court found that the Young

exception applied even though plaintiffs claiming enforcement-

related relief never alleged that the underlying state statute

violated federal law. See 804 F.3d 389, 392, 394-95 (5th Cir.

2015). There, a company called NiGen labeled dietary supplements

with the term “hCG.” Id. at 392. The Attorney General of Texas

found the labeling to be misleading according to the Texas

Deceptive Trade Practices Act and sent letters to NiGen intimating

that formal enforcement was on the horizon if NiGen did not change

the labeling. Id. NiGen subsequently sought permanent injunctive

relief and a declaration that its labeling did not violate federal

law, among other remedies. Id. When NiGen filed suit, the Attorney

General claimed that NiGen never alleged an ongoing violation of

federal law. Id. at 394. The court found that “the complaint’s

straight forward allegations, of which there are many,” stating

that the Attorney General refuses to justify its threatening

letters in violation of the Constitution, are “sufficient to

demonstrate the ongoing nature of the alleged unconstitutional

conduct which a federal court could remedy through prospective

relief.” Id. at 395. The plaintiffs did not allege that the Texas

Deceptive Trade Practices Act, the underlying statute, was

unconstitutional, but rather, that the enforcement measures were.

Id. Nevertheless, the court in NiGen still found those allegations

sufficient for Young to apply. Id.

Here, plaintiffs do not allege that Article 1434 is

unconstitutional or violates a federal law,3 but they allege that

3 In their motion for reconsideration, defendants continually state that

plaintiffs never allege that Article 1434 violates the Sherman Act; plaintiffs

“contend only that Defendants’ alleged conduct violated the Sherman Act, not

Article 1434 itself.” Rec. Doc. 265-1 at 5, 6, 11. This assertion was never in

dispute. See Rec. Doc. 263 at 8 (“[Plaintiffs] assert that the Board members’

enforcement of [Article 1434] violates the Sherman Act.”). The Court’s previous

Order does state that “[i]f a plaintiff alleges a state law violates a federal

statute, then the Ex parte Young exception still applies.” Rec. Doc. 263 at 9.

But the Court never stated that plaintiff made this allegation, it was merely

speaking generally. Defendants acknowledge that “[t]his Court has previously

clarified that its references to Article 1434 violating the Sherman Act ‘refer

to plaintiffs’ allegations that [Defendants] enforcement of Article 1434

violates the Sherman Act.’” Rec. Doc. 265-1 at 11 (quoting Rec. Doc. 262 at 7).

They continue: “That clarification was made in a different context . . . and

Defendants do not believe the Court intended to apply that same clarification

here. Rather, Defendants believe the Court’s decision addressed whether Article

1434, as the ‘underlying authorization’ for Defendants’ enforcement actions,

defendants’ enforcement measures, such as prohibiting “agreements

between court reporters and customers which offer volume-based

price discounts,” applying Article 1434 to insurance companies who

are not a party to a case, and enforcing Article 1434 against court

reporters who enter into volume based discounts, violate the

Sherman Act. See Rec. Doc. 117 at 11, 13, 16-18. As such,

plaintiffs seek “[a] permanent injunction against the Board

prohibiting enforcement of Louisiana Code of Civil Procedure

Article 1434 and 46 La. ADC Pt XXI, § 130 for the purpose of

discouraging, eliminating, or prohibiting volume-based price

discounts by court reporters.” Id. at 22. Essentially, when

plaintiffs seek an injunction against enforcement of Article 1434

“for the purpose of discouraging, eliminating or prohibiting

volume-based price discounts by court reporters,” they seek

prospective relief from the ongoing violations of federal law that

plaintiffs allege throughout their complaint. The Young exception

requires no more.4

It seems logical that in many cases where plaintiffs seek

enforcement related relief, plaintiffs also allege that the

was alleged to violate the Sherman Act.” Id. It is unclear why the Court would

not “apply the same clarification” across two of its own Orders, especially

when both Orders plainly state the same clarification. See Rec. Doc. 263 at 8.

4 Throughout their motion for reconsideration and reply, defendants argue that

Article 1434 does not violate the Sherman Act. See Rec. Doc. 265-1 at 2-3, 5,

7-10; Rec. Doc. 272 at 8-9. The Court need not address whether Article 1434

violates the Sherman Act as it finds that neither party alleges as so, and

plaintiffs need not allege that Article 1434 violates the Sherman Act for Young

to apply. See Rec. Doc. 265-1 at 2; Rec. Doc. 267 at 3.

underlying state statute is unconstitutional. If a plaintiff

alleges a state statute itself violates federal law, then it

follows that the relief sought would be an injunction prohibiting

enforcement of that state statute. See, e.g., City of Austin v.

Paxon, 943 F.3d 993, 996, 998-99 (5th Cir. 2019) (seeking to

prohibit enforcement of a state statute because it violates federal

law). However, merely because the term “enforcement” is included

in requested relief, does not necessitate the plaintiffs alleging

that the underlying state statute they seek relief from is

unconstitutional. See Papasan v. Allain, 478 U.S. 265, 279 (1986)

(“In discerning on which side of the line a particular case falls,

we look to the substance rather than to the form of the relief

sought.”).

Still, defendants rely on Worcester County Trust Co. v. Riley,

302 U.S. 292, 299 (1937), Cory v. White, 457 U.S. 85, 91 (1982),

and Papasan v. Allain, 478 U.S. 265, 277 (1986) to argue that

plaintiffs’ allegations are not sufficient to prompt application

of the Ex parte Young exception. Id. The three cases cited,

nevertheless, do not clearly illustrate that the state statute

itself needs to explicitly violate federal law for Young to apply.

In Worcester County Trust, the Court found that “the

threatened action of respondents” did not involve “any breach of

state law or of the laws or Constitution of the United States,”

and thus, the Young exception was inapplicable. 302 U.S. at 299.

However, the Court did not foreclose the possibility that

threatened action could violate the laws of the United States, and

therefore, warrant application of the Young exception. Id. at 298.

In fact, it specifically contemplates this possibility. See id.

(suggesting that if petitioner asserted that courts in California

or Massachusetts threatened to hold that their laws taxing

inheritances apply to intangibles of those domiciled in other

states, an action that would violate federal law, then that type

of action could be “within the reach of the federal judicial

power”).

Cory also does not support defendants’ proposition. Cory did

decline to overrule Worcester County Trust, as defendants note,

but does not suggest that a state law itself must violate federal

laws for the Young exception to apply. See 457 U.S. at 91. Indeed,

Cory states that Worcester County Trust’s main holding is that

“generally, suits to restrain action of state officials can,

consistently with the constitutional prohibition, be prosecuted

only when the action sought to be restrained is without the

authority of state law or contravenes the statutes or Constitution

of the United States.” Id. at 89. Cory then affirms that “the

Eleventh Amendment bars suits against state officers unless they

are alleged to be acting contrary to federal law or against the

authority of state law.” Id. at 91. No aspect of this language

seems to suggest that a state law, as written, must specifically

violate federal law for the Young exception to apply.

In Papasan v. Allain, the Court states, “Young applies only

where the underlying authorization upon which the named official

acts is asserted to be illegal.” Papasan, 478 U.S. at 277.

Defendants insist this clause means a state statute must be alleged

to be illegal for Young to apply, but it could mean that any

authority, such as a guideline, directive, or order, that an

official uses to act in violation of federal law must be “asserted

to be illegal.” See id. Indeed, this interpretation would seem to

explain NiGen Biotech, L.L.C. v. Paxton, as well as Verizon

Maryland, Inc. v. Public Service Commission of Maryland, a Supreme

Court case more recent than Papasan. See 804 F.3d 389, 392, 394-

95 (5th Cir. 2015); 535 U.S. 635, 645-46 (2002).

In Verizon, plaintiff filed a complaint against the Maryland

Public Service Commission (“Commission”) for issuing an order that

plaintiff claimed violated federal law. 535 U.S. at 640. The Court

did not find that any underlying state statute violated federal

law. See id. at 645-46. Plaintiff’s allegations that the

Commission’s action, through its order, violated federal law were

sufficient for the Young exception to apply. Id. The Court even

added that “Ex parte Young itself was a suit against state

officials . . . to enjoin enforcement of a railroad commission’s

order requiring a reduction in rates.” Id. at 646. Indeed, the

plaintiff’s claim in Verizon was not based on enforcement of a

statute, it was based on an order, but Papasan’s statement that

“Young applies only where the underlying authorization upon which

the named official acts is asserted to be illegal” makes no

distinction between claims based on enforcement of a statute or

enforcement of an order. See 478 U.S. at 277. Consequently, the

Court finds that it did not err in finding that plaintiffs alleged

an ongoing violation of federal law, and that plaintiffs satisfied

the second prong of the Young criteria. See Green Valley, 969 F.3d

at 471.

C. Prospective Relief

“[A] litigant may sue a state official in his official

capacity if the suit seeks prospective relief to redress an ongoing

violation of federal law.” Williams on behalf of J.E. v. Reeves,

954 F.3d 729, 736 (5th Cir. 2020). Defendants claim that

plaintiffs’ requested relief against defendants in their official

capacity do not redress an ongoing violation of federal law. They

state, “how would enjoining enforcement of Article 1434 prevent an

ongoing violation of federal law as required for Young? The answer:

it would not.” Rec. Doc. 272 at 1. In doing so, defendants seem to

revive an argument from their original motion to dismiss. See Rec.

Doc. 247-1 at 2. There, they claimed plaintiffs cannot avoid

“Eleventh Amendment immunity by ‘qualifying’ their injunctive

relief to enforcement taken ‘for the purpose of’ attacking alleged

volume-based discounts.” Id. Defendants argue that “the Eleventh

Amendment protects the enforcement of a constitutional state

statute—as written—regardless of any alleged illicit ‘purpose.’”

Id.; see also Rec. Doc. 272 at 4 n.5 (“It does not matter that

Plaintiffs ‘limit’ their requested injunction to enforcement

actions taken when so-called ‘volume-based price discounts’ are

involved.”).

In making these arguments, defendants seem to believe that

there is no difference between seeking an injunction against

enforcement of Article 1434 and an injunction against enforcement

of Article 1434 “for the purpose of discouraging, eliminating, or

prohibiting volume-based discounts.” See Rec. Doc. 117 at 22. We,

however, see a distinction, and find that plaintiffs do seek

“prospective relief to redress an ongoing violation of federal

law.”5 See Air Evac EMS, Inc. v. Tex. Dep’t Ins., Div. of Workers

Comp., 851 F.3d 507, 520 (5th Cir. 2017) (“As with most

jurisdictional questions, Ex Parte Young and standing turn on the

specific details in the complaint.”).

Plaintiffs generally allege that the Board’s interpretation

and enforcement of Article 1434 violates the Sherman Act. See Rec.

Doc. 117 at 10-13, 21-22. Specifically, plaintiffs claim the Board

5 Defendants seem to even recognize a possibility of this distinction as they

omit “for the purpose of discouraging, eliminating, or prohibiting volume-based

price discounts by court reporters” every time they quote plaintiff’s prayer

for relief. See Rec. Doc. 272 at 1-4, 7.

has declared that it prohibits agreements between court reporters

and customers which offer volume-based price discounts or service

concessions to frequent customers. Id. at 11. They allege the Board

has also interpreted the statute to extend to assignments paid for

by insurance companies on behalf of their insureds, even if the

insurance company is not party to the suit. Id. Plaintiffs also

claim that to enforce its directives, the Board in several

instances issued “broad and burdensome subpoenas to insurance

companies for the express purpose of disrupting the commercial

relationships between insurance companies and national court

reporting firms like Veritext.” Id. at 16. According to plaintiffs,

to be released from the subpoena, the Board demanded that these

insurance companies publicly declare that they did not have

exclusive contracts with court reporting firms like Veritext. Id.

Additionally, plaintiffs alleged the Board hired attorneys to

investigate court reporters and opened formal investigations. Id.

at 16-17. Allegedly, the Board also sent Veritext a Notice of

Investigation and a Rule to Show Cause. Id. at 17-18. “Although

the Board ultimately continued the show cause hearing without date,

Veritext, Esquire, and other national court reporting firms . . .

remain in jeopardy of prosecution.” Id. at 18. To address these

alleged ongoing violations of federal law, plaintiffs seek “[a]

permanent injunction against the Board prohibiting enforcement of

Louisiana Code of Civil Procedure Article 1434 and 46 La. ADC Pt

XXI, § 130 for the purpose of discouraging, eliminating, or

prohibiting volume-based price discounts by court reporters.” Id.

at 22.

If plaintiffs had simply sought an injunction against Article

1434 enforcement without a qualifier, then we might agree with

defendants that plaintiffs’ prospective relief would not redress

an ongoing violation of federal law. As neither party claims

Article 1434 violates the Sherman Act or is otherwise

unconstitutional, then asking to fully prohibit enforcement of

Article 1434 would be too expansive. See Rec. Doc. 267 at 3; Rec.

Doc. 265-1 at 2. Nevertheless, plaintiffs do seek an injunction on

the enforcement of Article 1434 “for the purpose of discouraging,

eliminating, or prohibiting volume-based discounts.” See Rec. Doc.

117 at 22. Meaning, they seek relief from the practices that

plaintiffs throughout their complaint allege violate the Sherman

Act. See id. at 11, 13, 16-18; Rec. Doc. 168-2 at 3. Consequently,

plaintiffs’ prospective relief does redress an alleged ongoing

violation of federal law. See Papasan, 478 U.S. at 279 (“In

discerning on which side of the line a particular case falls, we

look to the substance rather than to the form of the relief

sought.”).

However, defendants maintain that since “Article 1434, as

written, does not violate federal law,” then “the enforcement of

Article 1434 as written . . . does not violate federal law,” and

consequently, the Young exception does not apply. Rec. Doc. 272 at

5. Article 1434 may not violate federal law as written, however,

that does not preclude the Board from enforcing Article 1434 in a

manner that does violate federal law. Indeed, plaintiffs do allege

that defendants may not be enforcing Article 1434 as written, and

that these errors in enforcement violate federal law. See Rec.

Doc. 117 at 11, 13, 16-18, 21-22. In plaintiffs’ complaint, they

state:

the statute lacks any definition of “contract” or other

standards to distinguish between lawful and unlawful

contracts. It provides no guidance about which of the

following alternatives is correct: (1) the statute

prohibits all agreements between court reporters and

party litigants; (2) the statute requires party

litigants to engage court reporters through their

attorneys; (3) the statute permits an agreement for a

single engagement but prohibits long-term agreements;

(4) the statute prohibits court reporters from offering

volume-based price discounts or service concessions to

frequent customers; (5) the statute prohibits referrals

from court reporting firms; or (6) the statute prohibits

a combination of the above or something else entirely.

Rec. Doc. 117 at 11. Plaintiffs allege that interpreting and

enforcing Article 1434 as a statute that “prohibits court reporters

from offering volume-based price discounts or service concessions

to frequent customers” is an interpretation of the statute that

violates the Sherman Act. Id. Consequently, defendants may believe

they are plainly enforcing Article 1434 as written, but plaintiffs

allege they are not. Id. At this stage, the Court need not decide

whether defendants’ actions actually violate the Sherman Act. In

deciding whether to grant the Young exception, the 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.” Verizon, 535 U.S.

at 645. We, thus, find that plaintiffs’ allegations are sufficient

for the Young exception to apply.

Finally, in defendants’ original motion to dismiss, they add

that “Plaintiffs’ requested injunctive relief could not even be

ordered because, as a practical matter, it would require the courts

to divine the ‘purpose’ behind the enforcement of Article 1434 and

lead to violations of the Younger doctrine.” Rec. Doc. 247-1 at 2.

Plaintiffs requested relief may be imprecise, but again, whether

the Court practically can or should grant plaintiffs’ requested

relief is not an appropriate inquiry for the Young exception. See

Verizon, 535 U.S. at 645; Air Evac, 851 F.3d at 520 (acknowledging

that Ex parte Young poses a “threshold jurisdictional question”

and declining to “consider the availability and scope of any

eventual relief”); Texas Democratic Party v. Abbott, 978 F.3d 168,

180 (5th Cir. 2020) (quoting Va. Off. for Prot. & Advoc. v.

Stewart, 563 U.S. 247, 255 (2011)) (“It is permissible under Ex

parte Young for a court to ‘command[] a state official to do

nothing more than refrain from violating federal law.’”). A Court

need only determine that plaintiff sued state officials in their

official capacity, alleged an ongoing violation of federal law,

and sought prospective relief. Green Valley, 969 F.3d at 471.

Plaintiffs’ allegations are sufficient to meet this standard.6

C. Plaintiffs’ Allegations Regarding the Board’s

Implementation of Rules and Regulations

In their reply, defendants argue that “plaintiffs falsely

suggest that their claims against Defendants in their official-

capacities rest on allegations that Defendants ‘implement[ed]

rules and regulations to increase the rates for court reporting

services in Louisiana and to discourage Plaintiffs and other court

reporting firms from competing in Louisiana.’” Rec. Doc. 272 at 5

(quoting Rec. Doc. 267 at 2-3). Thus, defendants contend that

plaintiffs cannot assert that “the ongoing ‘enforcement’ of any

rule or regulation has and will continue to violate the Sherman

Act in the future.” Id. at 6. Whether or not plaintiffs

mischaracterized their allegations, they do not need to allege

that a rule or regulation violates federal law for the Young

exception to apply, and thus, plaintiffs satisfy all Young

criteria.

6 In their sur-reply, plaintiffs suggest that they properly allege prospective

relief redressing ongoing violations of federal law because their prayer for

relief expressly asks for “such further relief, in law and equity, as the Court

may deem just and proper.” Rec. Doc. 274 at 1-2. Defendants assert that

“Plaintiffs are effectively asking this Court for permission to amend their

Complaints by broadening their requested official-capacity injunction to

undefined and undeterminable lengths.” Rec. Doc. 277 at 2. The Court need not

address plaintiffs’ argument, nor defendants’ response, as it finds plaintiffs’

request for an injunction prohibiting the Board’s enforcement of Article 1434

for the purpose of discouraging, prohibiting, or limiting volume-based discounts

is prospective relief redressing an ongoing violation of federal law. See Rec.

Doc. 117 at 22.

In their complaint, plaintiffs allege that the Board has

“advised” all court reporters that should they work for one of

these “national” firms, which engage in volume-based discounts,

then they might be in violation of Article 1434. See Rec. Doc.

168-2 at 3. This directive is similar to the order in Verizon that

the plaintiffs alleged was an ongoing violation of federal law. In

Verizon, the Court found that plaintiffs’ prayer “that state

officials be restrained from enforcing an order in contravention

of controlling federal law” was prospective relief redressing an

ongoing violation of federal law. Verizon, 535 U.S. at 645. Similar

to Verizon, plaintiffs here seek an injunction prohibiting

enforcement of Article 1434 “for the purpose of discouraging,

eliminating, or prohibiting volume-based discount”—or in other

words, plaintiffs seek an injunction against the ongoing

violations of federal law alleged throughout their complaint. See

Rec. Doc. 117 at 10-11, 21-22. Thus, whether or not plaintiffs

specifically allege that defendants “violated the Sherman Act in

their official capacities by implementing, promulgating, or

enforcing any rules or regulations,” the Court finds that

plaintiffs allege state officials’ actions present an ongoing

violation of federal law, and consequently, the Young exception

still applies. See Rec. Doc. 272 at 5.

New Orleans, Louisiana this 27th day of May, 2022

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SENIOR UNITED STATES DISTRICT JUDGE