Young Conservatives v. Smatresk

Case: 22-40225 Document: 00516815506 Page: 1 Date Filed: 07/10/2023

United States Court of Appeals

for the Fifth Circuit United States Court of Appeals

Fifth Circuit

____________ FILED

July 10, 2023

No. 22-40225

Lyle W. Cayce

____________ Clerk

Young Conservatives of Texas Foundation,

Plaintiff—Appellee,

versus

Neal Smatresk, President of the University of North Texas; Shannon

Goodman, Vice President for Enrollment of the University of North Texas,

Defendants—Appellants.

______________________________

Appeal from the United States District Court

for the Eastern District of Texas

USDC No. 4:20-CV-973

______________________________

Before Smith, Clement, and Wilson, Circuit Judges.

Edith Brown Clement, Circuit Judge:

States often charge their residents one price for public college and

charge those who live elsewhere much more. Texas allows illegal aliens who

satisfy residency requirements to pay that in-state, lower tuition. A Texas

university student group of out-of-state students sued officials at the

University of North Texas, arguing that Texas’ tuition scheme violated

federal law. The district court agreed and barred the university from charging

out-of-state tuition. We now REVERSE the judgment and VACATE the

injunction.

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No. 22-40225

I

The facts here are undisputed. In 1996, Congress passed the Illegal

Immigration Reform and Immigrant Responsibility Act. See Pub. L. No. 104-

208, Div. C, 110 Stat. 3009-546 (1996). That act, among other things,

restricts states’ authority to grant certain postsecondary education benefits

to illegal aliens unless other conditions are met. It directs that “an alien who

is not lawfully present in the United States shall not be eligible on the basis of

residence within a State . . . for any postsecondary education benefit unless a

citizen or national of the United States is eligible for such a benefit . . . without

regard to whether the citizen or national is such a resident.” 8 U.S.C. §

1623(a).

Meanwhile, Texas charges students who satisfy certain residency

requirements lower tuition than it charges to nonresident students. See Tex.

Educ. Code §§ 54.051(c)–(d), 54.052. So long as they satisfy the statute’s

residency requirements, illegal aliens are eligible for Texas resident tuition.

Out-of-state, nonresident American citizens are not. Currently, Texas

resident tuition is pegged at $50 per semester credit hour. See Tex. Educ.

Code § 54.051(c). Nonresident tuition instead totals $458 per semester

credit hour.

Enter this lawsuit. The Young Conservatives of Texas Foundation

(YCT) is a student group at the University of North Texas (UNT)

comprising many nonresident members. YCT’s “core organizational

purpose is to advance conservative values” through a variety of actions. It

has also “repeatedly opposed the disparate treatment of aliens who are not

lawfully present in the United States and United States citizens from other

states with regard to tuition.”

That latter goal collided with UNT’s tuition scheme. UNT, through

its President, Neal Smatresk, and its Vice President for Enrollment, Shannon

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Goodman, (the appellants here), charge illegal aliens who satisfied Texas’

residency requirements resident tuition, and charge U.S. citizens who failed

to meet those requirements nonresident tuition. YCT, believing this

disparity unlawful and harmful to its members, sued in state court for

injunctive and declaratory relief. Though it expressly disclaimed any

challenge to what UNT charges to illegal aliens, it argued that the UNT

officials improperly charged its members out-of-state tuition per § 54.051(d),

which YCT believed was preempted by 8 U.S.C. § 1623(a).

Sometime after removal, the parties cross-motioned for summary

judgment and the district court sided with YCT. It found that YCT had

associational standing to challenge § 54.051(d); that though UNT itself was

not a proper defendant under Ex parte Young, Smatresk and Goodman were1;

that § 54.051(d) is both expressly and impliedly preempted by § 1623(a); and

that YCT was entitled to a permanent injunction barring the UNT officials

from enforcing § 54.051(d). The court then declared § 54.051(d) preempted

and thus violative of the Constitution. It enjoined the UNT officials from

enforcing “the tuition rates prescribed by Section 54.051(d) of the Texas

Education Code against United States citizens at the University of North

Texas.” The UNT officials now appeal.

II

We review a grant (or denial) of summary judgment de novo.

Davidson v. Fairchild Controls Corp., 882 F.3d 180, 184 (5th Cir. 2018). A

“court should grant summary judgment when ‘there is no genuine dispute as

to any material fact and the movant is entitled to judgment as a matter of

law.’” Id. (quoting Fed. R. Civ. P. 56(a)). “We also review de novo the

district court’s ruling on standing[.]” See Students for Fair Admissions, Inc. v.

_____________________

1

The UNT officials do not challenge this conclusion.

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Univ. of Tex. at Austin, 37 F.4th 1078, 1083 (5th Cir. 2022). And finally, we

review a grant of a permanent injunction for abuse of discretion. Scott v.

Schedler, 826 F.3d 207, 211 (5th Cir. 2016) (per curiam).

A

First, we must decide whether YCT has standing to challenge

§ 54.051(d). We conclude they do.

To establish standing, YCT must demonstrate (1) an “injury in fact”

that is “concrete and particularized” and “actual or imminent”; (2) is fairly

traceable to the defendant’s actions; and (3) is likely to be redressed by a

favorable decision. Lujan v. Defs. of Wildlife, 504 U.S. 555, 560–61 (1992). But

even if YCT has suffered no injury, it “may have standing to assert the claims

of its members[.]” Tex. Ent. Ass’n. v. Hegar, 10 F.4th 495, 504 (5th Cir. 2021)

(citation omitted). To have associational standing, YCT must demonstrate

that its members would have standing to sue in their own right, that the

interests it seeks to protect are germane to its purpose, and that neither the

claim nor the requested relief requires its members to participate in the

lawsuit. Id. (citation omitted). It need only show that just one of its members

would have standing. See Hunt v. Wash. St. Apple Advert. Comm’n, 432 U.S.

333, 342 (1977).

The court below found that YCT’s out-of-state members would have

standing; that the suit was germane to YCT’s interests of education reform

and the treatment of illegal aliens; and that the suit did not require the

involvement of YCT’s members. As for YCT’s members themselves, the

court found that they were injured by paying nine times more than in-state

residents; that their injury was traceable to the UNT officials’ enforcing §

54.051(d); and that an injunction stopping such enforcement would redress

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the injury. On appeal, the UNT officials question only whether YCT’s

members have standing.2

First, the UNT officials argue that YCT’s members are not injured.

YCT and the district court’s theory of injury here is straightforward: in-state

residents pay an amount for college; enforcement of § 54.051(d) improperly

charges out-of-state citizens a far higher amount; and that far-higher amount

is an economic injury sufficient for standing.

In analyzing standing, we assume that YCT is correct on the merits

such that § 54.051(d) is preempted by § 1623(a). See, e.g., Texas v. EEOC, 933

F.3d 433, 447 (5th Cir. 2019) (“We assume, for purposes of the standing

analysis, that Texas is correct on the merits of its claim that the Guidance

was promulgated in violation of the APA.”). It’s also the case that an

economic injury is the “quintessential injury upon which to base standing.”

Tex. Democratic Party v. Benkiser, 459 F.3d 582, 586 (5th Cir. 2006). And to

confer standing, such injury “need not measure more than an identifiable

trifle.” OCA-Greater Hous. v. Texas, 867 F.3d 604, 612 (5th Cir. 2017)

(quotations and citation omitted).

UNT argues first that any “injury” the students sustained was of their

own making: out of all possible postsecondary options across the country, the

students chose to buy—at an open, disclosed price—an out-of-state

education where they are asked to pay more. In the UNT officials’ framing,

the university offered a bargain—out-of-state tuition in exchange for a college

education—which students accepted and got the benefit of.

_____________________

2

Though the UNT officials do not challenge the other components of standing, we

must nevertheless satisfy ourselves that they have been met. See Cleartrac, LLC v. Lanrick

Contractors, LLC, 53 F.4th 361, 364 (5th Cir. 2022). We conclude they have. Whether U.S.

citizens (or illegal aliens) are eligible for benefits is clearly germane to YCT’s mission, and

YCT’s members need not be involved in the pure legal question presented here.

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Indeed, “standing cannot be conferred by a self-inflicted injury.”

Zimmerman v. City of Austin, 881 F.3d 378, 389 (5th Cir. 2018) (citation

omitted); see also Nat’l Fam. Plan. & Reprod. Health Ass’n, Inc. v. Gonzales,

468 F.3d 826, 831 (D.C. Cir. 2006) (“We have consistently held that self-

inflicted harm doesn’t satisfy the basic requirements for standing. Such harm

does not amount to an ‘injury’ cognizable under Article III.”). But, at base,

the students are handing over money that, in the absence of Texas’

presumed-unlawful statute, they would happily retain. Cf. Maya v. Centex

Corp., 658 F.3d 1060, 1069 (9th Cir. 2011) (“[P]laintiffs spent money that,

absent defendants’ actions, they would not have spent. . . . This is a

quintessential injury-in-fact.”). Just because they agreed to do so does not

mean they are not, in fact, harmed by the 900% higher price UNT supposedly

lacks power to impose. See also 13A Charles A. Wright & Arthur

R. Miller, Federal Practice & Procedure § 3531.5 (3d ed. 2008

& Supp. 2022) (“Standing is not defeated merely because the plaintiff has in

some sense contributed to his own injury. . . . Standing is defeated only if it is

concluded that the injury is so completely due to the plaintiff’s own fault as to

break the causal chain.” (emphasis added)); Baldwin v. Fish & Game Comm’n

of Mont., 436 U.S. 371, 373, 377 n.14 (1978) (standing to challenge nonresident

pricing for hunting licenses).

“Causation and redressability then flow naturally from th[at] injury.”

Contender Farms, L.L.P. v. U.S. Dep’t of Agric., 779 F.3d 258, 266 (5th Cir.

2015); see also Lujan, 504 U.S. at 561–62 (explaining that when the plaintiff

“is himself an object of the action . . . at issue,” “there is ordinarily little

question that the action . . . has caused him injury, and that a judgment

preventing . . . the action will redress it”). The harm is directly traceable to

the UNT officials’ wrongfully enforcing § 54.051(d). That section sets out-

of-state tuition for these students (making them the statute’s indirect object),

which is then implemented and enforced by the UNT officials here. See Tex.

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Educ. Code § 54.051(d). That enforcement causes the students’ harm and

will continue to do so as more payments are collected. That’s enough to

establish traceability. Lujan, 504 U.S. at 560 (“[T]he injury has to be fairly

traceable to the challenged action of the defendant.” (cleaned up)).

The UNT officials offer thin arguments in response. They insist that

any duty to pay out-of-state tuition does not lie in a failure to properly apply

§ 1623(a), but instead comes from Texas’ legislative choice to charge that

tuition. They’re right in that, but the argument misunderstands YCT’s

claim. YCT agrees that it’s Texas’ legislative choice to charge their members

out-of-state tuition that caused their harm—but the entire point is that that

legislative choice is preempted by § 1623(a) and is thus void. That must be

assumed as true at this stage, and so we disagree with the UNT officials’

arguments to the contrary.

The future harm is also redressable by favorable action here. If the

UNT officials may no longer enforce § 54.051(d), then they may no longer

calculate and charge out-of-state tuition. That erases the students’ future

harm. The UNT officials’ responses again miss the mark. They claim that an

order enjoining § 54.051(d) cannot make these students suddenly eligible for

in-state tuition, which the officials believe to be the injury. But that

misunderstands YCT’s injury and, in turn, its desired remedy. YCT is not

asking us to make its members categorically eligible for in-state tuition.

Rather, YCT is asking us to stop UNT officials from charging an improper

or unlawful price. The officials muddy the two.

In response, the officials insist that they only charge rates set by

statute and the district court lacks any power to force Texas to change its

statutes. But as YCT notes, that misunderstands redressability. While it’s

true that no “provision in the Constitution permits a court to dictate to

legislative bodies . . . what laws . . . they must promulgate,” Mi Familia Vota

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v. Abbott, 977 F.3d 461, 469 (5th Cir. 2020), we need not do so here. As the

officials themselves explain, “[u]nder state law, a public university cannot

assess a charge unless authorized by law, giving UNT no choice but to assess

to out-of-state U.S. citizens the only tuition rate that was not enjoined: the in-

state tuition rate.” That’s exactly the fix that would—and so far, did—redress

the students’ injury. Preventing application of the unlawful rate imposed by

§ 54.051(d) is sufficient redress to establish standing.

Thus, YCT’s members have an injury in fact, traceable to the

complained-of acts of the defendants, which is likely redressable by favorable

action by this court. They therefore have standing. Because those members’

participation here is not needed, and because this suit is germane to YCT’s

purpose, YCT also has standing to challenge § 54.051(d).

B

Next, we must decide whether the specific provision that YCT has

chosen to challenge is preempted by federal law. We conclude it is not, even

if other, unchallenged provisions in Texas’ scheme may be.

Thanks to the Constitution’s Supremacy Clause, state laws that

conflict with federal law are without effect. See Cipollone v. Liggett Grp., Inc.,

505 U.S. 504, 516 (1992). Federal law can preempt state law when (1)

Congress expressly commands it so; (2) the state law and federal law actually

conflict; or (3) Congress “so thoroughly occupies a legislative field as to make

reasonable the inference that Congress left no room for the States to

supplement it.” Id. (quotations and citations omitted). “In determining

whether a state law or regulation is preempted, Congress’s intent is the

ultimate touchstone.” Union Pac. R.R. Co. v. City of Palestine, 41 F.4th 696,

704 (5th Cir. 2022) (quotations and citation omitted). Finding Congress’s

intent requires “examin[ing] the explicit statutory language and the structure

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and purpose of the statute.” Ingersoll-Rand Co. v. McClendon, 498 U.S. 133,

138 (1990).

The district court first found that § 1623(a) expressly preempted

§ 54.051(d). Then, in the alternative, the district court found that § 1623(a)

and § 54.051(d) conflicted to such a degree that following them both was

impossible. The UNT officials disagree on both fronts.

1

A federal statute expressly preempts a state law when Congress

“adopts express language defining the existence and scope of pre-emption.”

Est. of Miranda v. Navistar, Inc., 23 F.4th 500, 504 (5th Cir. 2022) (citation

omitted). And when the statute contains an express preemption clause, the

court does not indulge “any presumption against pre-emption but instead

focus[es] on the plain wording of the clause, which necessarily contains the

best evidence of Congress’ pre-emptive intent.” Puerto Rico v. Franklin Cal.

Tax-Free Tr., 579 U.S. 115, 125 (2016) (quotations and citation omitted).

“Evidence of pre-emptive purpose is sought in the text and structure of the

statute at issue, and in the first instance we focus on the plain wording of the

clause, which necessarily contains the best evidence of Congress’ pre-

emptive intent.” United Motorcoach Ass’n, Inc. v. City of Austin, 851 F.3d 489,

492 (5th Cir. 2017) (alterations adopted) (quotations and citation omitted).

Section 1623(a) contains an express preemption clause. It directs that

“[n]otwithstanding any other provision of law,” an illegal alien “shall not be

eligible on the basis of residence within a State . . . for any postsecondary

education benefit unless a citizen or national of the United States is eligible

for such a benefit . . . without regard to whether the citizen or national is such

a resident.” 8 U.S.C. § 1623(a). To reach its conclusion, the district court

framed the statute a different way. In § 1623(a) the district court found a

“simple rule: If a State makes an unlawfully present alien eligible for a

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postsecondary education benefit on the basis of state residency, it must make

a United States citizen eligible for the same benefit regardless of whether the

citizen is such a resident.” Thus, said the court, Congress meant to

“invalidate state laws that deny United States citizens eligibility for a

postsecondary education benefit . . . based on residency if unlawfully present

aliens are eligible for that benefit based on residence within the State.”

Because § 54.051(d) does exactly that (by charging nonresident tuition), it

was found expressly preempted.

The UNT officials balk at the court’s rewording. Rather than merely

make the statute easier to read, they say, the court instead “converted

Section 1623’s ‘unless’ clause—a condition precedent to granting a benefit

to aliens—into an affirmative obligation to give citizens benefits granted to

aliens.” This led the court to require states to grant benefits to citizens if they

grant those benefits to illegal aliens. Per the UNT officials, this improperly

rewrites Congress’s prohibitory statute and falsely implicates § 54.051(d).

We agree. Start with the text. Section 1623(a) commands that an

illegal alien “shall not be eligible on the basis of residence within a State . . .

for any postsecondary education benefit unless a citizen or national of the

United States is eligible for such a benefit . . . without regard to whether the

citizen or national is such a resident.” 8 U.S.C. § 1623(a) (emphasis added).

A preliminary question is what is meant by the chameleon “shall.” See Words

of Authority, Bryan Garner, Garner’s Dictionary of Legal

Usage (3d ed. 2011) (explaining that “shall can bear five to eight senses

even in a single document”). Typically, shall is meant to impose a duty (e.g.,

you shall file your taxes by April 15). But when followed by not, shall often

instead means may (i.e., you shall not means you may not). See id. (“The

word shall gives permission (as opposed to a duty), and shall not denies

permission (i.e., it means ‘may not’)”—Garner laments the “pervasive

problem” of shall/may misuse); see also Shall, Black’s Law

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Dictionary (11th ed. 2019) (explaining that shall can mean may,

especially when paired with a negative word like not or no).

That latter reading of “shall not” is the better understanding here: it

denies permission. Otherwise, § 1623 would impose a duty on illegal aliens to

not be eligible for benefits if citizens are not. That outcome wouldn’t make

sense. Instead—with “shall not” given proper effect—the statute simply

requires that all U.S. citizens be eligible for a benefit, without regard to

residency, before any alien be able to receive the same benefit (based on

residency). Hence the title, “Limitation on eligibility for preferential

treatment of aliens not lawfully present on basis of residence for higher

education benefits.” In doing so, it merely targets offending laws.

That brings us to the district court’s rewrite. The district court’s new

“rule” says, in essence, “that if a state says illegal aliens are eligible, it shall

say that U.S. citizens are eligible.” This is wrong in several ways. First, unlike

the statute, the district court imposes a duty—i.e., it uses the wrong

definition of shall. Unlike the statute as written, which is entirely prohibitory

and limits what can properly be done, the court’s rule demands action.

Second, it moves shall to the wrong side of the sentence. Rather than using

the statute’s proper “if A, then B” form (“if immigrants shall be eligible,

U.S. citizens are”), the court has it backwards (“if immigrants are eligible,

U.S. citizens shall be”). Third, it changes the object of the statute’s

regulation. Now, rather than declaring a limitation on illegal alien eligibility

itself, the court’s rule regulates states directly. In short, the district court

applied an entirely different rule than the one Congress passed.

So, going instead with the proper reading of § 1623(a), the statute

expressly preempts state rules that grant illegal aliens benefits when U.S.

citizens haven’t received the same. No matter what a state says, if a state did

not make U.S. citizens eligible, illegal aliens cannot be eligible. But, to be

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clear, § 1623(a) doesn’t impose any duty to grant the same benefits to U.S.

citizens. Cf. Day v. Bond, 500 F.3d 1127, 1139 (10th Cir. 2007) (“Section 1623

does not provide that ‘No nonresident citizen shall be denied a benefit’

afforded to an illegal alien, but rather imposes a limit on the authority of

postsecondary educational institutions.”). Its sole focus is on improper

benefits for illegal aliens.

Section 54.051(d)—the one and only section challenged here—does

not grant those benefits. It does nothing more than set the tuition price for

nonresident students, citizens or not. It takes no stance on whether illegal

aliens are eligible for a cheaper price.3 Section 1623(a) has nothing to say

about a rule like that. Therefore, § 54.051(d) is not expressly preempted by

§ 1623(a).

2

The district court, relying again on its erroneous reading, also found

that § 54.051(d) conflicted with § 1623(a) to such degree that it was impliedly

preempted. It is not.

Unlike express preemption, conflict preemption begins with the

presumption “that Congress did not intend to displace state law.” Maryland

v. Louisiana, 451 U.S. 725, 746 (1981) (citation omitted). Such preemption

exists when “compliance with both state and federal law is impossible, or

where the state law stands as an obstacle to the accomplishment and

execution of the full purposes and objectives of Congress.” Oneok, Inc. v.

Learjet, Inc., 575 U.S. 373, 377 (2015) (quotations and citation omitted).

Per the district court, it’s impossible to both (1) to charge out-of-state

U.S. citizens the nonresident tuition rate (as § 54.051(d) requires of

_____________________

3

Which we here assume is a postsecondary benefit.

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universities) and also (1) to charge out-of-state U.S. citizens the resident

price (as, thought the court, was required by § 1623(a) since illegal aliens

could earn resident tuition). Unsurprisingly, then, the district court found §

54.051(d) preempted.

But again, § 1623(a) does not require what the district court insists it

does. The court and YCT have it backwards: the problem with Texas’ system

relevant to § 1623(a) is that it grants illegal aliens in-state benefits, not that it

denies those benefits to U.S. citizens. Section 1623(a) does not restrict the

latter, and burdens Texas with no duty related to U.S. citizens. That

§ 54.051(d) calculates and imposes a nonresident tuition rate (for U.S.

citizens, foreign nationals, and immigrants alike) has nothing to do with

§ 1623(a)’s mandate that illegal aliens are ineligible for in-state benefits

unless U.S. citizens are. Thus, even though a different, unchallenged portion

of Texas’ scheme seems to conflict with § 1623(a), it is entirely possible to

follow both § 1623(a) and § 54.051(d) at the same time.

YCT’s arguments generally track the district court’s reasoning and

are wrong for the same reasons. But one warrants addressing. YCT contends

that § 1623(a) requires that universities either make illegal aliens eligible for

in-state tuition, or they can charge U.S. citizens out-of-state tuition. They

cannot do both. And, says YCT, § 1623(a) is “wholly agnostic on how

universities choose to comply with its terms.” Id. That is not correct. While

it’s true that § 1623(a) disallows alien eligibility if paired with citizen

ineligibility, the statute makes clear that if a state tries both, the former must

give. The statute does not grant a choice—illegal aliens simply are not eligible

if citizens aren’t.

Further still, though the district court didn’t address the question,

§ 54.051(d) does not hamper Congress’s § 1623(a) objectives. To start,

declaring a statute enough of an obstacle for implied preemption is “a matter

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of judgment, to be informed by examining the federal statute as a whole and

identifying its purpose and intended effects[.]” Crosby v. Nat’l Foreign Trade

Council, 530 U.S. 363, 373 (2000). As luck would have it, Congress made

explicit its aims for the Illegal Immigration Reform and Immigrant

Responsibility Act. See 8 U.S.C. § 1601. They include promoting immigrant

self-sufficiency, reducing immigrant reliance on public assistance, and

ensuring that public benefits aren’t incentives to enter illegally. Id. The

strictures of § 54.051(d) are silent on those objectives. Section 54.051(d) only

imposes nonresident tuition for those who do not qualify for Texas residency

(alien or citizen alike). It does not offer a public benefit to illegal aliens, and

thus cannot affect that class’s self-sufficiency, their reliance on public

services, or their incentives to come to America. Unlike Texas’ rule allowing

illegal aliens to qualify for resident tuition (which implicates every IIRIRA

objective, often in the negative), § 54.051(d) speaks only to the price that

nonresidents pay. Congress’s objectives are not thwarted by that higher

price.

Since § 54.051(d) neither conflicts with, nor harms the objectives of,

§ 1623(a), the latter does not impliedly preempt it. The district court was

wrong to find otherwise.

C

With that conclusion in mind, we turn next to whether the district

court abused its discretion in permanently enjoining the university officials

from enforcing § 54.051(d). We conclude it did.

The court reviews a grant of a permanent injunction for abuse of

discretion. Scott, 826 F.3d at 211. A district court “abuses its discretion if (1)

relies on clearly erroneous factual findings when deciding to grant or deny

the permanent injunction (2) relies on erroneous conclusions of law when

deciding to grant or deny the permanent injunction, or (3) misapplies the

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factual or legal conclusions when fashioning its injunctive relief.” Peaches

Ent. Corp. v. Ent. Repertoire Assocs., 62 F.3d 690, 693 (5th Cir. 1995).

Because the district court awarded a permanent injunction by relying

on its erroneous preemption analysis, it abused its discretion.

III

There may be valid preemption challenges to Texas’ scheme here. But

this is not one of them. The district court’s judgment is REVERSED, and

its permanent injunction is VACATED.

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