# United States Court **of Appeals**  **f or the Fifth Circuit** 

**____________** No. 22

- 50315

**____________ Haseeb Abdullah,** 
Plaintiff

— Appellant **,**

versus
**Ken Paxton; Glenn Hegar,**
Defendants

— Appellees

**.**

**______________________________** Appeal from the United States District Court for the Western District of Texas USDC No. 1:20

- CV

- 1245

**______________________________** Before **Richman ,**  Chief Judge **,** and **Haynes** and **Graves ,**  Circuit Judges

**. Per Curiam**  **:** In this case, Haseeb Abdullah c halleng es the constitutionality of Texas Government Code § 808. He contends that § 808’s divestment requirement violates the First Amendment and the Due Process Clause. The district court concluded that Abdullah lacked standing and dismissed his claims. For the r easons discussed below , we **AFFIRM**

. United States Court of Appeals Fifth Circuit 

### FILED April 11, 2023 Lyle W. Cayce Clerk Case: 22-50315 Document: 00516707924 Page: 1 Date Filed: 04/11/2023No. 22

- 50315

2 I. Factual Background

Abdullah is a former State of Texas employee and a current Travis County employee

. B y virtue of th e s e employment s , Abdullah has contribut ed to (and is therefore a beneficiary of ) two relevant retirem ent plans . The first is a defined

- benefit plan maintained by the Texas Employee Retirement System (“ERS”) , and the second is a defined

- benefit plan administered by the Texas County and District Retirement System (“TCDRS”). ERS and TCDRS ( together, the “S ystems”) collect employee contributions in a fund and manage the fund’s invest ment to increase its overall value. A t retirement, Abdullah will be eligible to receive fixed monthly payment s . The payment amount will be calculated based on a number of standard factors. 1 Notably, however, the amount will be independent of the market performance of the overall fund and any individual investment decisions made by the Systems

. Because t he Systems are public entities , the ir investments are subject to the oversight of the Texas Legislature. See, e.g. , **Tex. Gov’t Code** § § 802.203(a) , 811.003, 801.107

. In 2017 , the Texas Legislature enacted Texas Government Code § 808 , which is a prohibition on investment in companies that boycott the country of Israel or o therwise engage in the “BDS

movement

. ” 2 Under § 808 , the Texas Comptroller is required to maintain a

**_____________________**

1 The ERS plan payments are calculated based on, inter alia, an employee’s start date, years of service, and salary; the TCDRS plan payments are based on overall member contributions, a guaranteed seven percent interest rate ( compounded annually ) , and other factors not relevant here.

2 T he “BDS movement” is a pro

- Palestinian movement that “seeks to put economic pressure on Israel ” to substantia lly improve its treatment of Palestinian s

. Amawi v. Paxton , 956 F.3d 816, 819

– 20 & n.1 (5th Cir. 2020). “BDS” refers to the actions that the movement’s participants engage in, including boycotts, divestments, and sanctions. In an effort to curtail parti cipation in t he BDS movement , many states have enacted “anti

- BDS Case: 22-50315 Document: 00516707924 Page: 2 Date Filed: 04/11/2023No. 22

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3 list of companies that boycott Israel and provid e that list to the Systems. **Tex. Gov’t Code** § 808.051. T he Systems are then directed to “sell, redeem, divest, or withdraw all publicly traded securities of the [listed] company.” Id. § 808.053(d). If the Systems fail to comply, t he Texas Attorney General is authorized to bring an enforcement action

. Id. § 808.102. Relevant here, Abdull ah sued the Texas Comptroller and the Texas Attorney General (collectively, “Defendants”) in federal court. He s ought a declaratory judgment that § 808 ’s divestment requirement violates (1) the Freedom of Speech Clause; (2) the Establishment Clause; and ( 3) the Due Process Clause. Defendants moved to dismiss under Federal Rule s of Civil Procedure 12(b)(1) and (6) . The district court concluded that Abdullah lacked Article III standing and dismissed his claims. Abdullah timely appealed

. II. Jurisdiction & Standard of Review We have appellate jurisdiction under 28 U.S.C. § 1291. 3 We review

a district court’s dismissal for lack of standing de novo. Air Evac EMS, Inc.

**_____________________** laws

. ” Abdullah alleges in various claims that § 808 is one such law and is unconstitutional. B ut

— g iven our decision on standing

— we do not reach the merits of th o se claims

.

3 Defendants urge that we lack appellate jurisdiction

. In doing so, they observe that (1) Abdullah originally also named two individual directors as defendants; (2) he later moved to voluntarily dismiss the directors; and (3) the district court thereby dis miss ed the directors , without prejudice

. B ecause the directors were dismissed without prejudice , Defendants contend that the order appealed from here i s not “ final ” under § 1291 since it technically did not resolve all claims against all parties. S ee Wil liams v. Seidenbach , 958 F.3d 341 , 343 (5th Cir. 2020) (en banc)

. We disagree. T hough a voluntary dismissal c ould preclude our review in some situations , th at is not the case here. Abdullah concede s that his claims against th e directors were barred by sovereign immunity

— a jurisdictional defect. Under our precedent, d ismissals based on jurisdictional issues must , by their very nature, be with out prejudice. See , e.g. , Wa r nock v. Pecos County , 88 F.3d 341, 343 (5th Cir. 1996)

. But, r egar dless of how Case: 22-50315 Document: 00516707924 Page: 3 Date Filed: 04/11/2023No. 22

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4 v. Tex

. Dep ’ t of Ins., Div. of Workers ’ Comp. , 851 F.3d 507, 513 (5th Cir. 2017). In doing so, we apply the same standard as the district court

— accept ing all well

- pleaded factual allegations in the complaint as true and view ing them in the light most favorable to the plaintiff. Lane v. Halliburton , 529 F.3d 548, 557 (5 th Cir. 2008).

III. Discussion We agree with the district court that Abdullah lacks standing to pursue his claims

. Article III grants jurisdiction to federal courts only over actions involving an “actual case or controversy.” City of Los Angeles v. Lyons , 461 U.S. 9 5, 101 (1983). Accordingly, Abdullah bears the burden of establishing the three “familiar elements of standing.” Shrimpers & Fishermen of RGV v. Tex. Comm’n on Env’t Quality , 968 F.3d 419, 424 (5th Cir. 2020) (per curiam). To do so, he must demonstrate that he has suffered “(1) an injury in fact , (2) that is fairly traceable ” to the D efendants ’ actions, (3) that is likely to be redress ed by a favorable outcome

. Id. ; see also Lujan v. Defs. of Wildlife , 504 U.S. 555, 560

– 61 (1992). All three elements are “an indispensable part of [Abdullah’s] case.” Lujan , 504 U.S. at 561. Our analysis begins and ends with the first element: injury in fact

. To satisfy this requirement , Abdullah must plead that “he has sustained or is immediately in danger of sustaining some direct injury.” City of Los Angeles , 461 U.S. at 101 (internal quotation marks and citation omitted). That injur y needs to be “concrete and particularized,” as well as “actual or immi nent.” K.P. v. LeBlanc , 627 F.3d 115, 122 (5th Cir. 20 1 0) (quotation omitted). Importantly, it cannot be speculative , conjectural , or hyp othetical. Clapper

**_____________________** it was titled, the order in this circumstance was analogous to a dismissal with prejudice

. I n other words, Abdullah cannot re

- plead his claims against the directors

— t he y are plainly precluded by the jurisdictional bar. Thus, the district court’s order was sufficiently final , and our appellate jurisdiction is sound

. Case: 22-50315 Document: 00516707924 Page: 4 Date Filed: 04/11/2023No. 22

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5 v. Amnesty Int’l USA , 568 U.S. 398, 409 (2013)

. A llegations of only a “possible” future injury similarly will not suffice

. Id. ; see also Shrimpers , 968 F.3d at 424. Abdullah alleges he has incurred two types of injuries in connection with § 808 ’s divestment requirement : (1) a threat of a future economic loss and (2) several constitutional violatio ns

. We address both in

turn , but neither proves successful

. A. Threat of Future Economic Injury First, Abdullah c laims he satisfie d the injury

- in

- fact requirement because he has alleged there is a realistic risk that § 808 will cause him to suffer future ec onomic harm. At the outset, we note that Abdullah concedes that he has not currently sustained any monetary injury

— he ha s not plead ed that he is eligible for retirement , that he currently qualifies for any payments from t he Systems , or , most importantly, that those payments have been reduced as a result of the divestment requirement

. Rather, Abdullah’s purported injury rests on an entirely forward

looking theory. He avers that the Systems

— as managers of his vested financial benefits

— are requi red to base their divestment decisions on the dictates of § 808, rather than pure free market considerations. He contends that these constraints on the Systems’ discretion will have an a d verse effect

on the fund’ s overall financial health , reducing his fu ture pension benefits

. Per Abdullah, t his threat of diminished future payments is sufficient to establish the injury

- in

- fact requirement

. We disagree. At the outset , we observe that the divestment requirement is not absolute. Rather, the Texas Legislature notably built safeguards into § 808 providing several relevant exceptions. For example, under § 808.005, the Systems do not have to comply if they conclude that divesting “would be inc onsistent with [their] fiduciary responsibilit[ies]” or would conflict with “other duties imposed by law.” Similarly, Case: 22-50315 Document: 00516707924 Page: 5 Date Filed: 04/11/2023No. 22

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6 § 808.056(a) (1) permit s investment in listed companies if the Systems determine that divesting will cause them to “suffer a loss in the h ypothetical value of all assets under management .” Finally, under § 808.056( a ) (2), the Systems are exempted from compliance if the relevant portfolio s utilize “ a benchmark

- aware strategy,” that “would be subject to an aggregate expected deviation from its benchmark as a result of having to divest.” With those exceptions in mind, we t urn to Abdullah ’s allegations here. We conclude that his alleged injury is

— at most

— speculative ; he has wholly fa iled to allege that any risk of economic harm is “ certainly impending.” S ee Cla p

p e r , 568 U.S. at 409 (emphasis in original) (quotation omitted)

. Abdullah’s future benefits do not hinge on market performance ; at retirement, he will receive payments from two separate defined

- benefit plans. A s the Supreme Court has observed, defined

- benefit plans

— by their very nature

— do not fluctuate based on the value of the overall fund. See Thole v. U.S. Bank N.A

. , 140 S. Ct. 1615, 1618 (2020) (observing that payments under such plans do not fluctuate based on any “good or bad” investment or divestment decisions)

. The defined

- benefit plans Abdullah is enrolled in are no different

— as noted above, his payments are fixed , and calculation of those payments is based on entirely independent factors

. Because Abdullah cannot show how any investment or divestment decisions will affect his future payments, he cannot show that he has suffered an injury. Id. at 1619

. Put plainly, because “the outcome of this suit [will] not affect [his] future benefit payments ,” he lacks any concrete stake in this lawsuit. Id.

T he only way Abdullah could demonstrate he will “actually” suffer future economic harm is if he plausibly allege d that , as a result of § 808 ’s constraints, the Systems will not be able to pay out his benefits at all when he reaches retirement

. See id. at 1621. Abdullah tries his hand at this argument , Case: 22-50315 Document: 00516707924 Page: 6 Date Filed: 04/11/2023No. 22

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7 urging that the Systems are underfunded, so there is a credible threat the fund will fail

. But w e are unconvinced

— this theory is simply too speculative (and also ignores Texas’s ability to obtain funds by taxes, fees, assessments, etc.)

. In sum, we ar e unconvinced by Abdullah’s argument that this injury is “certainly impending”

— rather, it’s a speculative view of the distant future , at best. Prestage Farms , Inc. v. Bd. of Superiors of Noxubee Cnty. , 205 F.3d 265, 268 (5th Cir. 2000)

. Accordingly, the threat of “future injury under these circumstances is too conjectural and hypothetical to provide Article III standing.” Id.

B. Constitutional Injuries

Abdullah a lternatively asserts that § 808 inflicts several constitutional injuries sufficient for Article III standing. We recognize that v iolations of constitutional rights may of course , in some instances, satisfy the injury

- in

fact requirement. See TransUnion LLC v. Ramirez , 141 S. Ct. 2190, 2204 (2021). But t he Supreme Court has long rejected th e argument that a “claim that the Constitution has been violated ” is enough on its own “ to confer standing

. ” See Valley Forge Christian Coll. v. Ams. United for Separation of Church & State , Inc. , 454 U.S. 464, 48 5 (1982)

. Rather, Abdullah must still

est ablish a violation of his own personal rights. See id. at 474

– 75; see also Barber v. Bryant , 860 F.3d 345, 352

– 53 (5th Cir. 2017) (“ T he Establishment Clause is no exception to the requirement of standing,” and a plaintiff still “must allege a personal vio lation of rights.”).

Abdullah has failed to allege facts demonstrating t hat § 808 causes him an injury by violat ing his own personal Fourteenth or First Amendment rights

. As to the former , in order to assert a due process claim, Abdullah

must allege that he will suffer an injury to a vested property interest. See Bryan v. City of Madison , 213 F.3d 267, 274

– 75 (5th Cir. 2000); Blackburn v. City of Marshall , 42 F.3d 925, 935 (5th Cir. 1995). He certainly has a property Case: 22-50315 Document: 00516707924 Page: 7 Date Filed: 04/11/2023No. 22

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8 interest in his future payments from the Systems. Hughes Aircraft Co. v. Jacobson , 525 U.S. 432, 439

– 40 (1999 ); see also Thole , 140 S. Ct. at 1620

. However, for the reasons discussed above, Abdullah has failed to plead that § 808 poses any credible threat to those payments. Therefore, his d ue p rocess claim does not provide an independent basis for standing.

As to the latter

— the First Amendment claims

— Abdullah does not allege that § 808 infringes on his ability to speak. Nor does h e allege that § 808 infringes on his own religious beliefs. He cannot assert arguments based only on other’s rights (such as the companies that are on the divestment list). See Lujan , 504 U.S. at 563 (“[T]he party seeking review” must “be himse lf among the injured.” (quotation omitted)). Abdullah “must assert his own legal rights and interests , and cannot rest his claim to relief on the legal rights or interests of third parties.” Valley Forge , 454 U.S. at 474 (emphasis added) (quotation omitt ed)

. He has failed to do so here

. In sum, we conclude Abdullah ’s constitutional claims do not establish injury in fact as required for Article III standing

. 4

IV. Conclusion For the reasons discussed above, we **AFFIRM** the district court’s dismissal of Abdull ah’s claims

.

**_____________________**

4 Defendants also urge that sovereign immunity bars Abdullah’s claims. Because we conclude Abdullah lacks standing, we need not reach that issue. Sinochem Int’l Co. v. Malaysia Int’l Shipping Corp. , 549 U.S. 422, 431 (2007) (recognizing that while “jurisdictional questions ordinarily must precede merits determinations[,] . . . there is no mandatory sequencing of jurisdictional issues” (internal quotation ma rks and citation omitted)). Case: 22-50315 Document: 00516707924 Page: 8 Date Filed: 04/11/2023