United States Court of Appeals for the Fifth Circuit United States Court of Appeals Fifth Circuit

____________ FILED September 21, 2023 No. 22-30398 Lyle W. Cayce ____________ Clerk

I F G Port Holdings, L.L.C.,

Plaintiff—Appellee,

versus

Lake Charles Harbor & Terminal District, doing business as Port of Lake Charles,

Defendant—Appellant. ______________________________

Appeal from the United States District Court for the Western District of Louisiana USDC No. 2:16-CV-146 ______________________________

Before Graves, Higginson, and Douglas, Circuit Judges. Stephen A. Higginson, Circuit Judge: In 1979, Congress authorized Article III judges to refer civil cases to non-Article III magistrate judges “[u]pon consent of the parties.” Federal Magistrate Act of 1979, Pub. L. No. 96-82, 93 Stat. 643, 643. Five years later, then-Judge Anthony Kennedy explained, writing for the en banc Ninth Circuit, that “consent of the parties is essential to the constitutionality of the Act.” Pacemaker Diagnostic Clinic of Am., Inc. v. Instromedix, Inc., 725 F.2d 537, 546 (9th Cir. 1984) (en banc). Shortly after, our court followed the lead of other circuits in upholding the constitutionality of consent-based Case: 22-30398 Document: 00516903136 Page: 2 Date Filed: 09/21/2023

No. 22-30398

magistrate-judge referrals. Puryear v. Ede’s Ltd., 731 F.2d 1153, 1154 (5th Cir. 1984). In this case, the parties consented to have their sprawling commercial dispute tried before a United States magistrate judge. But, allegedly unbeknownst to the defendant, the judge was longtime family friends with the lead trial lawyer for the plaintiff. Specifically, the lawyer had been a groomsman in the judge’s own wedding, and the judge officiated the wedding of the lawyer’s daughter three months before this lawsuit was filed. None of this information was disclosed to the defendant. After a twenty-day bench trial, the magistrate judge rendered judgment for the plaintiff, awarding $124.5 million, including over $100 million in trebled damages. After the issuance of the judgment and award, the defendant learned about the undisclosed longstanding friendship and sought to have the magistrate-judge referral vacated. The district judge denied the request and denied discovery on the issue. The defendant now appeals. We conclude that the facts asserted here, if true, raise serious doubts about the validity of the defendant’s constitutionally essential consent to have its case tried by this magistrate judge. We therefore VACATE the district court’s order. Because the facts are not sufficiently developed for us to decide whether the defendant’s consent was validly given or whether vacatur of the referral is otherwise warranted, we REMAND to the district court for an evidentiary inquiry consistent with this opinion.

I. This is an appeal from a judgment following a twenty-day bench trial before a magistrate judge. The case involves a years-long contract dispute between a commercial tenant, plaintiff-appellee IFG Port Holdings, LLC

2 Case: 22-30398