The Texas Credit Union Department placed the credit union into conservatorship and appointed the National Credit Union Administration (NCUA) as the conservator. The NCUA terminated the credit union's CEO (the “employee”) and withheld his post-termination benefits. The employee sued the credit union in state court, claiming he was entitled to those benefits. However, before the case proceeded, the NCUA initiated an administrative enforcement action against him under 12 U.S.C. § 1786. The employee then filed a separate lawsuit in federal district court, asserting constitutional challenges to the NCUA’s authority and the enforcement action process. The NCUA filed a motion to dismiss for lack of subject matter jurisdiction, which the federal district court granted. The employee appealed to the Fifth Circuit. The sole issue before the Fifth Circuit was whether the district court erred in dismissing the employee’s case on the ground that § 1786(k)(1) explicitly precludes the district court’s jurisdiction.
In Moats v. Nat’l Credit Union Admin. Bd., 153 F.4th 449 (5th Cir. 2025), the Fifth Circuit affirmed the district court’s dismissal for lack of subject-matter jurisdiction. The court first noted that “‘Congress can limit district court jurisdiction if it so chooses,’” either explicitly or implicitly. Cochran v. SEC, 20 F.4th 194, 200 (5th Cir. 2021); Axon Enterprise, Inc. v. Federal Trade Commission, 598 U.S. 175 (2023). In determining whether the district court’s jurisdiction has been limited, the court must examine whether the text of the statute expressly limits jurisdiction. Bank of La. v. FDIC, 919 F.3d 916 (5th Cir. 2019). The Fifth Circuit further explained that its recent opinion in Burgess v. Whang, 152 F.4th 579 (5th Cir. 2025), which held that a different but similarly worded statute (§ 1818) explicitly precluded district court jurisdiction, was controlling here and that nothing more (outside of the statute) is required to “preclude constitutional claims from a district court’s jurisdiction.” The court also rejected the employee’s argument that Shalala v. Ill. Council on Long Term Care, Inc., 529 U.S. 1 (2000). “requires a statute to reference § 1331 or another jurisdictional statute” to preclude jurisdiction… The court held that the statute addressed in Shalala “differed significantly from § 1786 (and § 1818)” and the Supreme Court’s analysis there was, for that reason, inapplicable here. As such, the court “refuse[d] to hold that Shalala requires Congress to use magic words to preclude jurisdiction.” Accordingly, the court concluded that § 1786(k)(1) expressly barred the district court from having jurisdiction in this context.
By Noah Coggan [email protected]
Edited By Taylor O’Brien [email protected]
Edited By Kristin Meurer [email protected]
Edited By Hayden Mariott [email protected]