United States v. Raza Services ( 2022 )

Case: 21-40507 Document: 00516228963 Page: 1 Date Filed: 03/08/2022
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
March 8, 2022
No. 21-40507
Lyle W. Cayce
Summary Calendar Clerk
United States of America,
Plaintiff—Appellee,
versus
Raza Services, L.L.C.; Amir Raza, Individually,
Defendants—Appellants.
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 3:19-CV-143
Before Wiener, Dennis, and Haynes, Circuit Judges.
Per Curiam:*
On December 30, 2013, Raza Services executed a promissory note on
a $522,000 loan from the Small Business Administration. Roughly two years
later, Raza Services defaulted on its obligations under the note. The United
States filed suit in district court to recover debts owed under the note. Raza
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 21-40507 Document: 00516228963 Page: 2 Date Filed: 03/08/2022
No. 21-40507
Services contended that the SBA had released all claims related to the note
in a settlement agreement in a prior state court proceeding. After holding a
hearing at which Raza Services’s counsel conceded that the neither the
settlement agreement nor the underlying state court litigation involved the
SBA note at issue in the case before the district court, the district court
granted summary judgment for the United States. Raza Services appealed.
***
We review an award of summary judgment de novo. FDIC v. Selaiden
Builders, Inc., 973 F.2d 1249, 1253 (5th Cir. 1992). Summary judgment is
appropriate only if the pleadings, the discovery and disclosure materials on
file, and any affidavits show that there is no genuine issue as to any material
fact and that the movant is entitled to judgment as a matter of law. Fed. R.
Civ. P. 56. “Typically, suits on promissory notes provide fit grist for the
summary judgment mill.” FDIC v. Cardinal Oil Well Servicing Co., 837 F.2d
1369, 1371 (5th Cir. 1988).
On appeal, Raza Services argues that the district court erred in
disposing of this case on summary judgment because the settlement
agreement is ambiguous, precluding disposition by summary judgment. Raza
Services points to a provision in the settlement agreement wherein Raza
Services agrees to release Texas First Bank—the plaintiff in the state case
and another creditor of Raza Services—from any claims “arising out of the
Loan Documents.” The phrase “Loan Documents” in the agreement refers
to three loans Texas First Bank made to Raza Services on January 17, 2013,
which Raza Services had also defaulted on. Raza Services argues that since
Texas First Bank had, by the time of settlement, assigned one of these loans
to the SBA, it is unclear whether the settlement agreement releases other
loans that the SBA made to Raza Services, or only those arising out of the
Loan Documents.
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Case: 21-40507 Document: 00516228963 Page: 3 Date Filed: 03/08/2022
No. 21-40507
We find no ambiguity in the settlement agreement, and no merit in
Raza Services’s argument. The settlement agreement only releases Raza
Services from claims related to the three loans made by Texas First Bank on
January 17, 2013. Nowhere is the loan at issue here—made by the SBA to
Raza Services on December 30, 2013—mentioned in the settlement
agreement. Nor was it ever at issue in the underlying state court litigation
between Texas First Bank and Raza Services. There is simply nothing in the
settlement agreement that would allow a reasonable juror to conclude that
the agreement absolves Raza Services of liability for its default on the
December 30, 2013 promissory note. The fact that in the agreement Raza
Services releases Texas First Bank from any claims arising from a loan that
Texas First Bank later assigned to the SBA has no bearing on Raza Services’s
obligations under an entirely different loan, made directly from the SBA.
Raza Services’s counsel conceded this before the district court and there is
nothing in the settlement agreement to suggest he was mistaken.
We AFFIRM the district court’s judgment.
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