Court Opinion

ID: 6863
Source: CourtListenerOpinion
Date Created: 2010-04-25 05:22:09+00
Date Added: 2024-06-11T15:04:47.252855
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IN THE UNITED STATES COURT OF APPEALS

                           FOR THE FIFTH CIRCUIT

                           _____________________

                                No. 93-8170
                           _____________________

            FIRST GIBRALTAR BANK, FSB and
            BENEFICIAL TEXAS, INC.,

                                    Plaintiffs-Appellants,

            v.

            DAN MORALES, Atty. General, as
            Attorney General for the State of
            Texas, ET AL.,

                                    Defendants-Appellees.

_________________________________________________________________

           Appeal from the United States District Court
                 for the Western District of Texas
_________________________________________________________________
                         (January 4, 1994)

Before POLITZ, Chief Judge, KING and DAVIS, Circuit Judges.

PER CURIAM:

      Our prior opinion in this case, First Gibraltar Bank, FSB v.

Morales, 19 F.3d 1032 (5th Cir.), cert. denied, 115 S. Ct. 204

(1994), is vacated and the following is substituted therefor.

      The issue presented for our determination is whether the Home

Owners' Loan Act,1 12 U.S.C. §§ 1461-1468c, and Chapter 39 of Title

12   of   the    United   States   Code,   formerly   designated   as   the

Alternative Mortgage Transaction Parity Act of 1982, together with

regulations thereunder, have preempted the Texas homestead law to

      1
       Terms defined in our prior opinion will have the same
meaning herein as therein defined.
the extent that it prohibits lenders from enforcing liens on home

equity created in reverse annuity mortgages or line of credit

conversion mortgages.        The district court granted summary judgment

in favor of the defendants, concluding that the federal statutes

and regulations did not preempt Texas homestead law. We affirm the

judgment of the district court.

                  I.    FACTUAL AND PROCEDURAL BACKGROUND

       This lawsuit began as an action for declaratory and injunctive

relief.       First Gibraltar sought a judicial declaration that the

HOLA and the Parity Act (together with the regulations promulgated

thereunder) preempted portions of the Texas homestead law.                  In

addition, First Gibraltar sought an injunction to prevent the Texas

Attorney General and the Texas Consumer Credit Commissioner from

enforcing the allegedly preempted portions of the Texas homestead

law.       In First Gibraltar Bank, FSB v. Morales, 19 F.3d 1032 (5th

Cir.), cert. denied, 115 S. Ct. 204 (1994), we reversed the

district      court's    grant   of   summary   judgment    for   the    State

defendants, holding, inter alia, that the OTS and its predecessor,

the FHLBB,       had   the   statutory   authority   to   effectuate    such a

preemption.

       Before the issuance of our mandate, however, the Riegle-Neal

Interstate Banking and Branching Efficiency Act of 1994 was signed

into law on September 29, 1994.2             See Pub. L. No. 103-328, 108

       2
          At this time, the State's petition for certiorari to
the Supreme Court was pending.

                                         2
Stat. 2338 (1994).     Section 102(b) of this Act amends section 3 of

the HOLA, 12 U.S.C. 1462a, by adding a new subsection (f) (the

"Amendment"):

     (f) STATE HOMESTEAD PROVISIONS. -- No provision of this
     Act or any other provision of law administered by the
     Director [of the Office of Thrift Supervision] shall be
     construed as superseding any homestead provision of any
     State constitution, including any implementing State
     statute, in effect on the date of enactment of the
     Riegle-Neal Interstate Banking and Branching Efficiency
     Act of 1994, or any subsequent amendment to such a State
     constitutional or statutory provision in effect on such
     date, that exempts the homestead of any person from
     foreclosure, or forced sale, for the payment of all
     debts, other than a purchase money obligation relating to
     the homestead, taxes due on the homestead, or an
     obligation arising from work and material used in
     constructing improvements on the homestead.

Pub. L. No. 103-328, § 102(b), 108 Stat. 2338, 2352 (1994).                Our

mandate has not yet issued in this appeal, and "[t]he normal rule

in a civil case is that we judge it in accordance with the law as

it exists at the time of our decision."        Tully v. Mobil Oil Corp.,

455 U.S. 245, 247 (1982).        Thus, we must examine the effect of the

Amendment in our consideration of this matter on appeal.            See id.

at 247-49 (applying statutory changes that occurred during the

pendency   of   the   appeal);    United   States   Dep't   of   Justice   v.

Provenzano, 469 U.S. 14, 15 (1984) (per curiam) (noting that the

issue on which certiorari was granted is "to be judged under the

law presently in effect").

                        II.   STANDARD OF REVIEW

     A district court's conclusions of law are reviewable de novo.

Prudhomme v. Tenneco Oil Co., 955 F.2d 390, 392 (5th Cir.), cert.

denied, 113 S. Ct. 84 (1992).         Nevertheless, we are required to

                                      3
give deference to an executive agency's interpretation of a statute

or regulation that the agency is responsible for administering. Of

course, if the intent of Congress is clear, that intent will trump

any agency interpretation to the contrary.            See Chevron, U.S.A.,

Inc. v. Natural Resources Defense Council, 467 U.S. 837, 842

(1984); Hawkins v. Agricultural Mktg. Serv., Dep't of Agric., 10
F.3d 1125, 1129 (5th Cir. 1993).

                    III.    ANALYSIS AND DISCUSSION

     We begin by examining our authority to continue adjudicating

this case, and we then briefly discuss the relationship between the

Amendment and our prior analysis.

                    A.     Control Over our Mandate

     "Our control over a judgment of our court continues until our

mandate has issued."       Alphin v. Henson, 552 F.2d 1033, 1035 (4th

Cir.), cert. denied, 434 U.S. 823 (1977); see Gradsky v. United

States, 376 F.2d 993, 995 (5th Cir. 1967).          Similarly, as the Ninth

Circuit   has   noted,     "where   the   mandate    has   not   issued   the

availability of appeal has not yet been exhausted." Bryant v. Ford

Motor Co., 886 F.2d 1526, 1530 (9th Cir. 1989), cert. denied, 493
U.S. 1076 (1990). In exceptional circumstances, we may even recall

our mandate to prevent injustice.         See Gradsky, 376 F.2d at 995;

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

Rule 41.2.

     First Gibraltar has argued that pursuant to Federal Rule of

Appellate Procedure 41(b), our mandate should have issued as soon

as the Supreme Court denied certiorari.        The Supreme Court denied

                                      4
certiorari in this case on October 3, 1994, and its order was

received and filed on October 13, 1994.              Prior to the denial of

certiorari, however, we had stayed the mandate in this case for two

independent reasons; first, to permit an en banc poll (which is now

unnecessary), and second, to allow the State to petition for

certiorari.    The mandate was initially stayed well before the

October 13, 1994 receipt of the Supreme Court's order denying

certiorari.   Rule 41(b) does state in relevant part that "[t]he

court of appeals must issue the mandate immediately when a copy of

a Supreme Court order denying the petition for writ of certiorari

is filed," but because our stay was in effect (for a reason

independent of the petition for certiorari) prior to the receipt of

the order, we retain discretionary control over our mandate.3                 See

Bryant, 886 F.2d at 1528-31; Alphin, 552 F.2d at 1034-36.

     Because the mandate is still within our control, we have the

power to alter or to modify our judgment.            See Bryant, 886 F.2d at

1528-31   (vacating   a   prior   en       banc   opinion   in   light   of   new

legislation, even though the Supreme Court had previously denied

certiorari, because the issuance of the mandate had been stayed for

an independent reason before the order denying certiorari was filed

in the circuit court); Alphin, 552 F.2d at 1034-36 (modifying a

     3
          To the extent that appellants attach any meaning to the
Supreme Court's denial of certiorari, the language of the Alphin
court is instructive: "The law is clear that the denial of
certiorari decides nothing except that the writ will not be
granted for reasons which are undisclosed." Alphin, 552 F.2d at
1035 n.6.

                                       5
prior judgment to conform to new legislation, even though the

Supreme    Court    had       previously       denied   certiorari,     because   the

issuance of the mandate had been stayed for an independent reason

before the denial of certiorari was filed in the circuit court).

As mentioned, we are to apply the law as it currently exists, and

we must necessarily include the effects of the Amendment in our

consideration.

                                    B.    Mootness

     Despite the State's contention that the Amendment moots this

appeal, we find that the mootness framework is inapplicable to the

posture of       this    lawsuit.        The      Amendment   clearly   affects   the

preemption analysis in this case. The Amendment does not, however,

eliminate the "actual controversy" between the parties; it informs

the decision, but it does not alter the original declaratory

posture of the case.           In other words, the parties still seek the

same declaration of their rights, but such a declaration is now

affected    by     the    language       of       the   Amendment.      An   "actual

controversy," capable of being resolved by a declaratory judgment,

is still ongoing.        See generally 10A Charles A. Wright & Arthur R.

Miller, Federal Practice & Procedure § 2751 (1984).                       Thus, the

mootness rubric is inapposite, and the Munsingwear line of cases --

a line that addresses the proper disposition of a lawsuit after a

mootness determination -- is inapplicable as well. Accordingly, we

proceed to resolve this appeal on the merits.

                         C.    Context of the Amendment

                                              6
       Before we begin to analyze the effects of the Amendment, it is

helpful to understand the relationship of the Amendment to our

prior analysis. In our previous opinion, we noted that the Supreme

Court's preemption analysis required us to ask two questions:

first, did the OTS intend to preempt Texas homestead law; and

second, if the OTS did intend to preempt Texas homestead law, was

the attempted preemption within the scope of the agency's delegated

authority?     See First Gibraltar Bank, 19 F.3d at 1044, 1049; see

also Fidelity Fed. Sav. & Loan Ass'n v. de la Cuesta, 458 U.S. 141,

158-59 (1982).          With respect to the second prong, we noted in our

prior opinion that "the best way of determining whether Congress

intended the regulations of an administrative agency to displace

state law is to examine the nature and scope of the authority

granted by Congress to the agency."                First Gibraltar Bank, 19 F.3d

at 1049 (quoting Louisiana Pub. Serv. Comm'n v. FCC, 476 U.S. 355,

374 (1986)).

       In this case, the Amendment clearly affects the second prong

of the preemption analysis, as the statutory language addresses the

scope of the congressional grant of authority to the OTS.                       As a

consequence, this second prong of the preemption analysis is now

the focus of our attention.           And, answering it as we do, we need

not,   and    do    not,   address    the       first   prong   of   the   preemption

analysis.

                   D.    Infringement on the Judicial Branch

       First Gibraltar initially argued that the HOLA expressed no

limits   on    the      FHLBB/OTS's   authority         to   regulate   the   lending

                                            7
practices of federal savings and loans, as the HOLA granted plenary

authority to the agency to issue regulations preempting portions of

the Texas homestead law.        Following enactment of the Amendment,

First    Gibraltar   contends   that   the   language   of   the    Amendment

unconstitutionally undermines the power of the judicial branch by

mandating a different construction of the HOLA, rather than by

changing the underlying law. First Gibraltar relies on the Supreme

Court cases of United States v. Klein, 80 U.S. (13 Wall.) 128

(1871), and Pennsylvania v. The Wheeling and Belmont Bridge Co., 59

U.S. (18 How.) 421 (1855), for the proposition that Congress cannot

"prescribe a rule for the decision of a cause in a particular way";

instead, Congress can only change the underlying law.              Because the

Amendment states that no provision of law "shall be construed as

superseding any homestead provision," First Gibraltar argues that

the Amendment "usurps the power of the courts by directing a

specific interpretation     of   unchanged     statutory     and   regulatory

provisions."    Assuming, without deciding, that First Gibraltar is

correct in its initial argument that the FHLBB/OTS had plenary

authority under the HOLA to preempt portions of the Texas homestead

law, we disagree with First Gibraltar's characterization of the

Amendment's language, as we find that the Amendment would clearly

change such plenary authority.4

     4
          It is important to note that we do not comment on
whether First Gibraltar's interpretation of Klein and Wheeling
Bridge is accurate. Instead, we merely determine that as
interpreted by First Gibraltar, these cases do not warrant a
finding that the Amendment is unconstitutional because the
Amendment does change the existing law (as that law is construed
by First Gibraltar). Cf. Robertson v. Seattle Audubon Soc'y, 112

                                       8
      In analyzing the effect of this language, the Supreme Court's

decision in Louisiana Pub. Serv. Comm'n is quite instructive.                        In

that case, the Supreme Court addressed whether the Communications

Act of 1934 granted the Federal Communications Commission ("FCC")

the   authority     to     preempt    inconsistent              state    regulations,

specifically    those    that    deviated          from   the   FCC's    depreciation

practices.   See Louisiana Pub. Serv. Comm'n, 476 U.S. at 358.                      The

Court noted that § 151 of the Communications Act gave the FCC broad

discretion "to develop a rapid and efficient national telephone

network."    Id. at 368.        Because of this broad mandate, the Court

observed that § 151 provided support to the position that the Act

preempts state regulation "which frustrates the ability of the FCC

to perform its statutory function of ensuring efficient, nationwide

phone service."     Id. at 370.

      Section 152(b) of the Act, however, asserted the following:

      [N]othing in this chapter shall be construed to apply or
      to give the Commission jurisdiction with respect to (1)
      charges,    classifications,     practices,    services,
      facilities, or regulations for or in connection with
      intrastate communication service . . . .

Louisiana Pub. Serv. Comm'n, 476 U.S. at 370 (quoting 47 U.S.C. §

152(b)) (emphasis added).         The Court referred to this language as

an "express jurisdictional limitation[] on FCC power," and the

Court specifically noted that "Section 152(b) constitutes . . . a

congressional     denial    of    power       to    the   FCC    to     require   state

S. Ct. 1407, 1414 (1992) ("The Court of Appeals held that [the
legislation] was unconstitutional under Klein because it directed
decisions in pending cases without amending any law. Because we
conclude that [the legislation] did amend applicable law, we need
not consider whether this reading of Klein is correct.").

                                          9
commissions to follow FCC depreciation practices for intrastate

ratemaking purposes."        Id. at 370, 374 (emphasis added). Thus, the

Court held that § 152(b) "denies the FCC the power to pre-empt

state   regulation     of     depreciation       for   intrastate     ratemaking

purposes."   Id. at 373.       We conclude, therefore, that the Supreme

Court interpreted the "shall be construed" language of § 152(b) as

a legitimate limitation on the scope of authority delegated by

Congress to the FCC.

     If, as First Gibraltar argued, in enacting the HOLA, Congress

expressed no limits on the FHLBB/OTS's authority to regulate the

lending practices of federal savings and loans, the law has been

changed because the relevant language of the later Amendment

provides such a limitation.            The Amendment states that "[n]o

provision of this Act or any other provision of law administered by

the Director     [of   the    Office   of   Thrift     Supervision]    shall   be

construed as superseding any homestead provision of any State

constitution."     Just as this language was seen as a congressional

denial of power to the FCC in Louisiana Pub. Serv. Comm'n, we

interpret the Amendment's language as a congressional narrowing of

authority to the OTS.         Because the "shall be construed" language

represents a congressional denial of power where once, arguendo,

there were "no limits," the Amendment represents a change in the

underlying   law   and      avoids   any    of   First   Gibraltar's    alleged

separation of powers problems between the legislature and the

judiciary.

                                       10
     Our conclusion is strengthened by the legislative history of

the Amendment. The Joint Explanatory Statement of the Committee of

Conference accompanying the Amendment explicitly notes that:

     [t]his amendment clarifies that neither the Home Owners'
     Loan Act nor any other provision of law provides the
     Director of the Office of Thrift Supervision with the
     authority, through regulation or otherwise, to preempt
     Texas law in the area of homestead protection.         By
     extension, housing creditors under the Alternative
     Mortgage Transaction Parity Act who were impacted by the
     decision in the First Gibraltar case also continue to be
     subject to Texas law in the area of homestead protection.

H.R. Conf. Rep. No. 651, 103rd Cong., 2d Sess. 57-58 (1994)

(emphasis added).      Thus, it is clear that the Amendment was

designed to restrict the congressional delegation of authority to

the OTS with regard to preemption of state homestead laws.          This

explicit legislative purpose is consistent with our analysis and

with our conclusions about the statutory language itself.

     Finally, numerous statutory schemes use the language "shall be

construed"   to   describe   the   limitations   and   boundaries   of   a

congressional delegation of authority.5          See, e.g., McCarran-

Ferguson Insurance Regulation Act, 15 U.S.C. § 1012(b) ("No Act of

Congress shall be construed to invalidate, impair, or supersede any

law enacted by any State for the purpose of regulating the business

of insurance . . . ."); ERISA, 29 U.S.C. § 1144(b)(2)(A) ("Except

as provided in subparagraph (B), nothing in this subchapter shall

be construed to exempt or relieve any person from any law of any

State which regulates insurance, banking, or securities."); Omnibus

     5
          Indeed, the appendix to the State's brief indicates
that 2,020 statutory sections of the United States Code contain
the language "shall be construed."

                                    11
Budget Reconciliation Act, 42 U.S.C. § 1395ss(j) ("Nothing in this

section shall be construed so as to affect the right of any State

to   regulate    medicare   supplemental   policies   which,   under   the

provisions of this section, are considered to be issued in another

State.").   These statutes are not constitutionally infirm because

of their use of "shall be construed," and we see no reason to reach

a different result with regard to the Amendment in this case.6

                E.   Infringement on the Executive Branch

      First Gibraltar also argues that the Amendment infringes on

the authority of the executive branch "because it overturns agency

action that has developed over at least fifteen years without

      6
          First Gibraltar attempts to distinguish these statutes
from the Amendment by noting that "[s]uch provisions . . . are
not, as in this case, enacted many years after the original
legislation with the express purpose of overturning the result of
a specific judicial decision." We conclude, however, that this
is not a meaningful distinction. Congress retains the power to
narrow the scope of its delegated authority at any time. See INS
v. Chadha, 462 U.S. 919, 955 (1983) ("Congress must abide by its
delegation of authority until that delegation is legislatively
altered or revoked.") (emphasis added); Stop H-3 Ass'n v. Dole,
870 F.2d 1419, 1437 (9th Cir. 1989) ("It is fully within
Congress' prerogative legislatively to alter the reach of the
laws it passes . . . .").

          Even though the Amendment's legislative history states
that it "overturns an interpretation of [the HOLA] in First
Gibraltar Bank v. Morales," such an express purpose is not
troublesome because Congress constitutionally restricted the
scope of authority delegated to the OTS. Moreover, the simple
enactment of legislation to overturn a particular judicial
decision is not problematic in itself. See, e.g., Louisiana Pub.
Serv. Comm'n, 476 U.S. at 372 ("It is certainly true . . . that
when Congress was drafting the Communications Act, § 152(b) was
proposed and supported by the state commissions in reaction to
what they perceived to be the evil of excessive federal
regulation of intrastate service such as was sanctioned by the
Shreveport Rate Case . . . . [W]e agree that provisions in both
the Senate and House bills were designed to overrule the
Shreveport Rate Case . . . .").

                                    12
suggesting that the agency overreached its authority or otherwise

acted improperly."               Similar to its infringement on the judiciary

argument, First Gibraltar contends that "Congress cannot merely

exercise a veto power over a legitimate exercise of executive

authority without changing the agency's instructions, and without

mandating any change in the agency's future conduct or regulatory

scheme."

         Once    again,     however,     we   disagree    with    First   Gibraltar's

characterization, as Congress has narrowed the agency's authority.

As part of its legislative powers, Congress designates the scope of

agency authority, and if Congress so chooses, it can subsequently

restrict or limit that delegation of power to the agency.                          The

Supreme         Court    has     noted   that      "Congress    ultimately   controls

administrative agencies in the legislation that creates them," and

more importantly, the Court has observed that "Congress must abide

by       its    delegation        of   authority      until    that   delegation    is

legislatively altered or revoked."                   See Chadha, 462 U.S. 919, 955

& n.19 (1983) (emphasis added); see also Stop H-3 Ass'n v. Dole,

870 F.2d 1419, 1437 (9th Cir. 1989) ("It is fully within Congress'

prerogative legislatively to alter the reach of the laws it passes

.    .    .    .");     Office    of   Consumers'     Counsel    v.   Federal   Energy

Regulatory Comm'n, 655 F.2d 1132, 1149, 1153 (D.C. Cir. 1980)

(suggesting that Congress could have altered the Federal Energy

Regulatory Commission's authority by passing new legislation).

There is simply no infringement on the power of the executive

branch when Congress narrows the scope of its delegated authority.

                                              13
Assuming arguendo that the OTS's authority was previously plenary,

the Amendment restricting the authority of the OTS represents a

classic example of a legitimate exercise of legislative power. Cf.

Louisiana Pub. Serv. Comm'n, 476 U.S. at 374 ("[A] federal agency

may pre-empt state law only when and if it is acting within the

scope of its congressionally delegated authority. . . . [A]n agency

literally has no power to act, let alone pre-empt the validly

enacted legislation of a sovereign State, unless . . . Congress

confers power upon it.").

     Furthermore, and perhaps most importantly, this circuit has

accorded   deference    to   an   agency's   determination   of   its   own

statutory authority.7    See NCNB Tex. Nat'l Bank v. Cowden, 895 F.2d
1488, 1494 (5th Cir. 1990) ("As the cases dealing with the pre-

emptive effect of agency actions suggest, substantial deference to

an agency's determination of its authority may be appropriate.");

Western Coal Traffic League v. United States, 719 F.2d 772, 777

(5th Cir. 1983) ("We begin, as we must, with a recognition of the

limited role this Court plays in reviewing an administrative

agency's construction of its statutory authority . . . ."), cert.

denied, 466 U.S. 953 (1984).        With regard to the effect of the

Amendment, in an amicus brief filed at our request, the OTS made

the following observations:

     7
       We follow our own case law, recognizing that, at least in
one context, there is some debate on this subject. Compare
Mississippi Power & Light Co. v. Mississippi, 487 U.S. 354, 377
(1988) (Scalia, J., concurring) with id. at 383 (Brennan, J.,
dissenting).

                                     14
     OTS understands the Gonzalez Amendment to preclude the
     agency, as of the date of enactment of the provision,
     from construing any provision of law administered by the
     Director as superseding the homestead provisions of Texas
     law that are at issue in this case. . . . OTS reads the
     amendment to change the applicable law and now to subject
     federal savings associations and certain other financial
     services institutions to the conditions of the Texas
     homestead laws.

According deference to the OTS's interpretation of its statutory

authority, as we must, it is clear that even the agency in question

construes the Amendment as a limitation on its authority.     Finding

no constitutional infirmity to dissuade us from this construction,

we disagree with First Gibraltar's assertions, and we find that the

Amendment is constitutionally valid.       Cf. Louisiana Pub. Serv.

Comm'n, 476 U.S. at 374 ("An agency may not confer power upon

itself.   To permit an agency to expand its power in the face of a

congressional limitation on its jurisdiction would be to grant to

the agency power to override Congress.     This we are both unwilling

and unable to do.").

                F.   Effectiveness of the Amendment

     First   Gibraltar   also   contends   that   the   Amendment   is

ineffective because the OTS regulations had already preempted the

state homestead provisions before the Amendment was passed.      Thus,

First Gibraltar argues that "the conflicting provisions of the

Texas homestead laws were not in effect on the date that Congress

enacted the . . . Amendment, and the Amendment cannot, and does not

attempt to resurrect previously preempted state law."

     Assuming arguendo that portions of the Texas homestead law

were preempted prior to the enactment of the Amendment, we cannot

                                 15
agree with First Gibraltar's apparent assumption that once a law is

preempted, it forever remains preempted and ineffective.           First of

all, we note that First Gibraltar fails to cite any authority in

support of this proposition.      Second, and more importantly, state

law can be preempted by federal legislation and by regulations

promulgated by federal agencies acting within the scope of their

congressionally delegated authority.          See Louisiana Pub. Serv.

Comm'n, 476 U.S. at 369; de la Cuesta, 458 U.S. at 154.             On the

date of the Amendment's enactment, the OTS's preemption of state

homestead law was no longer within the scope of its authority --

assuming that it ever was -- and consequently, there was no longer

any preemptive mechanism. Because the Texas homestead laws had not

been repealed, they were in effect on the date of the Amendment,

although they were arguably impotent in the context of federal bank

regulation.    Once the preemptive mechanism was removed, however,

the state homestead provisions -- already effective in all other

areas   --   were   also   effective   in   the   area   of   federal   bank

regulation.

     Similarly, we took great pains to make clear in our earlier

decision that this lawsuit deals only with two types of alternative

mortgage instruments -- the reverse annuity mortgage ("RAM") and

the line of credit conversion mortgage.       See First Gibraltar Bank,
19 F.3d at 1037.      We specifically emphasized "that the question

before us is not whether federal law has preempted Texas homestead

law in its entirety, but only whether Texas homestead law has been

preempted with respect to RAMs and line of credit conversion

                                   16
mortgages."    Id. at 1039.   Thus, any preemptive force of the OTS

regulations would not have completely "invalidated" the Texas

homestead laws.   Instead, the Texas homestead exemptions remained

very much "in effect" as to many lenders, excepting, at most, the

two types of alternative mortgage transactions at issue in this

case. Simply put, First Gibraltar's logic is puzzling, and without

any supporting citations, we decline to accept its position.

                          IV.   CONCLUSION

     For the foregoing reasons, the judgment of the district court

is AFFIRMED.   The mandate shall issue forthwith.

                                  17