Texas Department of Agriculture v. Be a Champion, Inc.; James Hong; Kevin Klotz; George Moon; And Jaron Barganier

ACCEPTED
15-25-00089-CV
FIFTEENTH COURT OF APPEALS
AUSTIN, TEXAS
8/25/2025 5:39 PM
No. 15-25-00089-CV CHRISTOPHER A. PRINE
________________ CLERK
FILED IN
15th COURT OF APPEALS
In the AUSTIN, TEXAS
8/25/2025 5:39:24 PM
Fifteenth Court of Appeals CHRISTOPHER A. PRINE
Clerk
Austin, Texas
________________
TEXAS DEPARTMENT OF AGRICULTURE, ET AL.,
Appellants,

v.

BE A CHAMPION, INC., JAMES HONG, KEVIN KLOTZ,
GEORGE MOON, AND JARON BARGAINER,
Appellees.
________________
On Appeal from the 53rd Judicial Court,
Travis County, Texas (No. D-1-GN-24-000305)
The Honorable Jessica Mangrum, Presiding
________________
APPELLEES’ BRIEF ON THE MERITS
________________

Kevin J. Terrazas
State Bar No. 24060708
kterrazas@terrazaspllc.com
Benjamin L. Dower
State Bar No. 24082931
Jennifer A. Foster
State Bar No. 24104938
TERRAZAS PLLC
1001 S. Capital of Texas Hwy, L250
Austin, Texas 78746
512.680.3257
COUNSEL FOR APPELLEES
IDENTITY OF PARTIES AND COUNSEL

Be a Champion, Inc.; James Appellees/Plaintiffs
Hong; Kevin Klotz; George
Moon; and Jaron Bargainer

Kevin J. Terrazas Trial and Appellate Counsel
Benjamin L. Dower
Jennifer A. Foster
TERRAZAS PLLC
1001 S. Capital of Texas Hwy
Building L, Suite 250
Austin, Texas 78746
512-680-3257
kterrazas@terrazaspllc.com
bdower@terrazaspllc.com
jfoster@terrazaspllc.com

The Texas Department of Appellants/Defendants
Agriculture (“TDA”); Sid Miller, in
his official capacity as TDA
Commissioner; Terry Keel, in his
official capacity as TDA Deputy
Commissioner; Laura Benavidez,
individually and in her official
capacity as TDA Administrator for
Food & Nutrition; Lena Wilson, in
her official capacity as TDA
Assistant Commissioner for the
Food & Nutrition Division; Annette
McBride, individually and in her
official capacity as TDA Director of
Community Operations; Carey
Spence Lenss, individually and in
her official capacity as TDA
Assistant Director of Community
Operations for Food and Nutrition;

ii
Senta Fortune, individually and in
her official capacity as TDA
Director of Community Operations
for Food and Nutrition; Belia
Montelongo, individually and in
her official capacity as TDA Senior
Administrative Review Specialist;
Celia Garcia, individually and in
her official capacity as TDA
Administrative Review Specialist;
Carl Crittendon, individually and
in his official capacity as TDA
Policy Analyst; and David
Dierksen, individually and in his
official capacity as TDA Assistant
Director for Policy

Todd Dickerson Trial and Appellate Counsel
Assistant Attorney General
General Litigation Division
P.O. Box 12548, Capital Station
Austin, Texas 78711-2548
737-228-7289
todd.dickerson@oag.texas.gov

iii
TABLE OF CONTENTS

Identity of Parties and Counsel ................................................................ii

Table of Contents ..................................................................................... iv

Table of Authorities ................................................................................. vii

Statement of the Case ............................................................................xiii

Statement Regarding Oral Argument .................................................... xv

Statement of Issues Presented............................................................... xvi

Introduction ............................................................................................... 1

Statement of Facts .................................................................................... 2

Summary of the Argument ....................................................................... 8

Argument ................................................................................................. 11

I. Appellants’ Arguments Regarding the Ultra Vires Exception
and Waiver Under the UDJA Miss the Mark. .................................... 11

A. The UDJA’s immunity waiver is not at issue. ......................... 11

B. Appellants are not immune from the ultra vires claim. .......... 11

1. Appellees do not rely on the ultra vires exception for
claims against the TDA. ............................................................... 12

2. Appellees pleadings are facially sufficient to establish
Appellants’ ultra vires acts and to demonstrate a lack of
immunity for those acts. ............................................................... 12

3. Appellees seek logically necessary relief. ............................. 16

4. Appellants lack “absolute discretion” to ignore
regulations or terminate BAC’s CACFP participation
without appropriate notice. .......................................................... 18

5. Appellees have standing to bring an ultra vires claim......... 19

iv
II. The Pleadings Plausibly Demonstrate Appellees’ Standing to
Pursue All of Their Asserted Claims. .................................................. 21

III. Appellees’ Section 1983 Claims Fall Under Ex Parte Young.
..................................................................................................... 24

IV. Appellees Pled Facially Valid Claims. ........................................ 26

A. Appellees’ procedural due-course of law claim based on a
property interest is facially valid. .................................................... 27

1. Appellees allege a valid property interest. ........................... 27

2. Appellees’ assertion of deficient process is facially valid.
............................................................................................... 32

B. Appellees’ procedural due-course-of-law claim based on a
stigma-plus liberty interest is facially valid. ................................... 35

C. Appellees’ substantive due-course-of-law claim is facially
valid. ................................................................................................. 38

1. Appellees allege protected property and liberty
interests. ....................................................................................... 39

2. Appellees allege arbitrary conduct. ...................................... 40

D. Appellees’ equal protection claim is facially valid. .................. 42

1. Appellees were treated differently in violation of the
Equal Protection Clause. .............................................................. 42

2. Appellants had no reasonable basis for their actions. ......... 45

3. Engquist does not foreclose Appellees’ alternatively-
pleaded class-of-one equal protection claim. ................................ 47

E. The redundant remedies doctrine does not bar any of
Appellees’ otherwise facially-valid claims. ...................................... 48

F. Appellees’ ultra vires claim is facially valid. ........................... 51

G. Appellees’ takings claim is facially valid. ................................ 51

v
Prayer ...................................................................................................... 57

vi
TABLE OF AUTHORITIES
Cases

Air Evac EMS, Inc. v. Tex. Dep't of Ins., Div. of Workers’ Comp., 851
F.3d 507 (5th Cir. 2017) ....................................................................... 24

Andrade v. NAACP of Austin, 345 S.W.3d 1 (Tex. 2011) ....................... 27

Armstrong v. Manzo, 380 U.S. 545 (1965) .............................................. 32

Arrington v. City of Dallas, 970 F.2d 1441 (5th Cir. 1992) .................... 37

Beaumont v. Bouillion, 896 S.W.2d 143 (Tex. 1995) .............................. 12

Bennett v. Spear, 520 U.S. 154 (1997)..................................................... 23

Bishop v. Wood, 426 U.S. 341 (1976) ...................................................... 27

Bledsoe v. City of Horn Lake, Miss., 449 F.3d 650 (5th Cir. 2006)......... 35

Book People, Inc. v. Wong, 91 F.4th 318 (5th Cir. 2024) ........................ 23

Brittingham v. Ayala, 995 S.W.2d 199 (Tex. App.—San Antonio
1999, pet. denied) ................................................................................. 50

Chambers-Liberty Counties Navigation Dist. v. State, 575 S.W.3d
339 (Tex. 2019) ..................................................................................... 27

City of Austin v. Paxton, 943 F.3d 993 (5th Cir. 2019) ........................... 25

City of El Paso v. Heinrich, 284 S.W.3d 366 (Tex. 2009).................. 12, 13

City of Elsa v. MAL, 226 S.W.3d 390 (Tex. 2007) ............................. 12, 51

City of Floresville v. Starnes Inv. Group, LLC, 502 S.W.3d 859 (Tex.
App.—San Antonio 2016, no pet.) ....................................................... 46

City of Houston v. 4 Families of Hobby, LLC, 702 S.W.3d 698 (Tex.
App.—Houston [1st Dist.] 2024, pet. filed) ......................................... 45

City of Houston v. Downstream Env’t., L.L.C., 444 S.W.3d 24 (Tex.
App.—Houston [1st Dist.] 2014, pet. denied) ................................ 42, 44

vii
City of Richardson v. Bowman, 555 S.W.3d 670 (Tex. App.—Dallas
2018, pet. denied) ................................................................................. 38

City of San Antonio v. TPLP Office Park. Props., 218 S.W.3d 60
(Tex. 2007) ............................................................................................ 38

Commons of Lake Hous., Ltd. v. City of Hous., 711 S.W.3d 666 (Tex.
2025) ..................................................................................................... 52

County of Dallas v. Wiland, 216 S.W.3d 344 (Tex. 2007) ....................... 29

Craig v. Tejas Promotions, LLC, 550 S.W.3d 287 (Tex. App.—Austin
2018, pet. denied) ................................................................................. 51

Doss v. Morris, Civ. No. SA-11-CV-00116-DAE, 2013 WL 2147460
(W.D. Tex. 2013)................................................................................... 40

Edelman v. Jordan, 415 U.S. 651 (1974) ................................................ 24

Engquist v. Oregon Dep't of Agric., 553 U.S. 591 (2008) .................. 47, 48

Foucha v. Louisiana, 504 U.S. 71 (1992) ................................................ 38

Gatesco Q.M. Ltd. v. City of Hous., 503 S.W.3d 607 (Tex. App.—
Houston [14th Dist.] 2016, no pet.) ............................................... 38, 42

Gen. Servs. Comm’n v. Little-Tex. Insulation Co., Inc., 39 S.W.3d
591 (Tex. 2001) ..................................................................................... 54

Greenholtz v. Inmates of Neb. Penal & Corr. Complex, 442 U.S. 1
(1979) .................................................................................................... 32

Grounds v. Tolar Indep. Sch. Dist., 856 S.W.2d 417 (Tex. 1993)
.................................................................................................. 28, 29, 30

Hall v. McRaven, 508 S.W.3d 232 (Tex. 2017)........................................ 13

Hampton v. Equity Trust Co., 607 S.W.3d 1 (Tex. App.—Austin
2020, pet. denied) ................................................................................. 21

Hartzell v. S.O., 672 S.W.3d 304 (Tex. 2023).............................. 20, 25, 26

viii
Hearts Bluff Game Ranch, Inc. v. State, 381 S.W.3d 468 (Tex. 2012)
.............................................................................................................. 57

Heckman v. Williamson County, 369 S.W.3d 137 (Tex. 2012) ... 19, 22, 23

Hensley v. State Comm’n on Judicial Conduct, 692 S.W.3d 184 (Tex.
2024) ..................................................................................................... 13

Honors Academy, Inc. v. Tex. Educ. Agency, 555 S.W.3d 54 (Tex.
2018) ..................................................................................................... 27

House of Tobacco v. Calvert, 394 S.W.2d 654 (Tex. 1965) ...................... 28

Houston Belt & Terminal Ry. Co. v. City of Houston, 487 S.W.3d 154
(Tex. 2016) ................................................................................ 18, 19, 42

Hughes v. City of Garland, 204 F.3d 223 (5th Cir. 2000) ....................... 37

Image API, LLC v. Young, 691 S.W.3d 831 (Tex. 2024) ................... 16, 17

In re Garza, 126 S.W.3d 268 (Tex. App.—San Antonio 2003,
mandamus denied) ............................................................................... 50

In re J.R., 652 S.W.3d 508 (Tex. App.—Houston [14th Dist.] 2022,
pet. denied) ........................................................................................... 38

In the Interest of K.S.L., 538 S.W.3d 107 (Tex. 2017) ............................. 32

Jim Olive Photography v. Univ. of Houston Sys., 624 S.W.3d 764
(Tex. 2021) ............................................................................................ 54

Lakey v. Taylor, 435 S.W.3d 309 (Tex. App.—Austin 2014, no pet.) ..... 38

Limon v. State, 947 S.W.2d 620 (Tex. App.—Austin 1997, no writ) ...... 28

Logan v. Zimmerman Brush Co., 455 U.S. 422 (1982) ........................... 29

LULAC v. City of Boerne, 659 F.3d 421 (5th Cir. 2011) ......................... 23

Marco Outdoor Adver., Inc. v. Reg’l Transit Auth., 489 F.3d 669 (5th
Cir. 2007).............................................................................................. 33

Mathews v. Eldridge, 424 U.S. 319, 333 (1976) ...................................... 32

ix
Morgan v. City of Alvin, 175 S.W.3d 408 (Tex. App.—Houston [1st
Dist.] 2004, no pet.) .............................................................................. 22

Nelson v. Univ. of Tex. at Dallas, 535 F.3d 318 (5th Cir. 2008) ............. 20

Ostrewich v. Tatum, 72 F.4th 94 (5th Cir. 2023) .................................... 25

Patel v. Texas Dep’t of Licensing & Reg., 469 S.W.3d 69 (Tex. 2015) ... 39,
48, 49

Reynoso v. Dibs US, Inc., 541 S.W.3d 331 (Tex. App.—Houston
[14th Dist.] 2017, no pet.) .................................................................... 38

Rivera v. Sonnenschein, No. 03-21-00516-CV, 2022 WL 1751685, at
*1, *6 (Tex. App.—Austin 2023, pet. denied) ................................ 45, 46

Rodriguez v. Serv. Lloyds Ins. Co., 997 S.W.2d 248 (Tex. 1999) ............ 15

Roe v. Patterson, 707 S.W.3d 94 (Tex. 2025) .......................................... 37

San Jacinto Savings & Loan v. Kacal, 928 F.2d 697 (5th Cir. 1991)
........................................................................................................ 39, 40

SO Apartments LLC v. City of San Antonio, Tex., 109 F.4th 343 (5th
Cir. 2024).............................................................................................. 32

Speech First, Inc. v. McCall, 138 F.4th 219 (5th Cir. 2025) ................... 20

State v. Holland, 221 S.W.3d 639 (Tex. 2007) ........................................ 54

Tahoe-Sierra Pres. Council v. Tahoe Reg'l Planning Agency, 535
U.S. 302 (2002) ..................................................................................... 56

Teeuwissen v. Hinds Cty., Miss., by and through its Bd. of
Supervisors, 78 F.4th 166 (5th Cir. 2023) ............................... 28, 29, 30

Tex. A&M Univ. Sys. v. Koseoglu, 233 S.W.3d 835 (Tex. 2007) ............. 22

Tex. Ass’n of Bus. v. City of Austin, Tex., 565 S.W.3d 425 (Tex.
App.—Austin 2018, pet. denied) .............................................. 26, 27, 43

Tex. Dep’t of Public Safety v. Martin, 882 S.W.2d 476 (Tex. App.—
Beaumont 1994, no writ) ..................................................................... 51

x
Tex. Dep’t of State Health Servs. v. Crown Distrib. LLC, 647 S.W.3d
648 (Tex. 2022) ..................................................................................... 28

Tex. State Bd. of Pharmacy v. Steely, 764 S.W.2d 806 (Tex. App.—
Austin 1988, writ denied) .................................................................... 49

Tex. Tel. Ass'n v. Public Utility Comm'n of Texas, 653 S.W.3d 227
(Tex. App.—Austin 2022, no pet.)................................................ passim

Tex. Workforce Comm’n v. Midfirst Bank, 40 S.W.3d 690 (Tex.
App.—Austin 2001, pet. denied) .................................................... 54, 56

Univ. of Tex. Med. Sch. at Houston v. Than, 901 S.W.2d 926 (Tex.
1995) ..................................................................................................... 32

Van Boven v. Freshour, 659 S.W.3d 396 (Tex. 2022) .............................. 50

Verizon Md., Inc. v. Public Serv. Comm’n of Md., 535 U.S. 635
(2002) .................................................................................................... 27

Webb’s Fabulous Pharmacies, Inc. v. Beckwith, 449 U.S. 155, 155-
56 (1980) ............................................................................................... 55

Williams on Behalf of J.E. v. Reeves, 954 S.W.3d 729 (5th Cir. 2020)
........................................................................................................ 25, 26

Statutes

42 U.S.C. § 1751 ...................................................................................... 55

42 U.S.C. § 1766 .................................................................... 13, 15, 30, 55

TEX. AGRIC. CODE § 12.0025 .................................................................... 15

TEX. GOV’T CODE § 2001.174.................................................................... 49

Other Authorities

89 FR 13150 ............................................................................................. 17

Rules

TEX. R. APP. P. 38.1 .................................................................................. 21

xi
Regulations

4 TEX. ADMIN. CODE § 25.182 .................................................................. 14

4 TEX. ADMIN. CODE § 25.183 .................................................................. 30

4 TEX. ADMIN. CODE § 25.31 .................................................................... 30

7 C.F.R. § 226.15 ..................................................................................... 41

7 C.F.R. § 226.6 ............................................................................... passim

xii
STATEMENT OF THE CASE

Nature of the This case arises from the Texas Department of
Case: Agriculture (“TDA”)’s termination of Appellants’
contractual participation in two federal aid programs—
the Child and Adult Care Food Program (“CACFP”) and
the Summer Food Service Program (“SFSP”), both of
which TDA administers on behalf of the USDA. With
respect to Appellee Be a Champion, Inc. (“BAC”), TDA—
through its officials—terminated BAC’s contracts and
its funding. As to the individual Appellees, James
Hong, Kevin Klotz, George Moon, and Jaron Bargainer,
TDA—again, acting through its officials—placed each
individual on the National Disqualified List, thereby
disqualifying their participation in any federally-funded
food program for a period of at least seven years. After
unsuccessfully attempting to resolve the
disqualification and termination decisions directly with
the TDA, Appellees filed suit, seeking redress pursuant
to the Administrative Procedure Act (“APA”), the
Declaratory Judgment Act (“UDJA”), and the U.S. and
Texas Constitutions against TDA and various of its
officers who Appellees sued both in their official and
individual capacities. In response, Appellants filed a
partial plea to the jurisdiction, which was not
successful, thereby generating this appeal.

District Court: The Honorable Jessica Mangrum, 200th Judicial
District Court, Travis County, Texas.

District Court The district court denied Appellants’ plea to the
Disposition: jurisdiction in its entirety.

Parties Below: Plaintiffs-Appellees: Be a Champion, Inc., James Hong,
Kevin Klotz, George Moon, and Jaron Bargainer

Defendants-Appellants: As referenced in this brief, the
“Official Capacity Defendants” include Sid Miller (TDA
Commissioner), Terry Keel (TDA Deputy

xiii
Commissioner), Laura Benavidez (TDA Administrator
for Food & Nutrition), Lena Wilson (TDA Assistant
Commissioner for the Food & Nutrition Division),
Annette McBride (TDA Director of Community
Operations), Carey Spence Lenss (TDA Assistant
Director of Community Operations for Food and
Nutrition), Senta Fortune (TDA Director of Community
Operations for Food and Nutrition), Belia Montelongo
(TDA Senior Administrative Review Specialists), Carl
Crittendon (TDA Policy Analyst), and David Dierksen
(TDA Assistant Director for Policy). And, when
“Individual Capacity Defendants” is used, the list
includes Laura Benavidez, Annette McBride, Cary
Spence Lenss, Senta Fortune, Belia Montelongo, Celia
Garcia, Carl Crittendon, and David Dierksen.

Related None.
Proceedings:

xiv
STATEMENT REGARDING ORAL ARGUMENT
This appeal presents straightforward legal issues on a clear and
unambiguous set of facts on a limited record. As such, Appellees do not
believe that oral argument will assist the Court in resolving the merits
of this appeal. Should the Court determine otherwise, however,

Appellees respectfully request the opportunity to participate in any oral
argument the Court may later schedule.

xv
STATEMENT OF ISSUES PRESENTED

1. Whether the district court properly denied Appellants’ plea to
the jurisdiction seeking the dismissal of Appellants’ ultra vires claim on
sovereign immunity grounds where Appellees sued numerous TDA
officials in their official capacities, plausibly alleged that those officials
acted without legal authority in the performance of a purely ministerial
act, and sought only prospective relief.

2. Whether the district court properly rejected Appellants’
standing challenge where the pleadings alleged that Appellants’ conduct
caused BAC to be terminated from federal aid programs, thereby
depriving it of millions of dollars in federal funding, and caused the
individual Appellees to be disqualified from those programs, thereby
prohibiting their participation in those or similar programs for a period
of at least seven years.

3. Whether the Ex parte Young exception to sovereign immunity
applies to Appellees’ federal claims against TDA officials brought against
those individuals in their official capacities where Appellees seek
prospective relief for ongoing federal constitutional violations resulting
in ongoing harm to Appellees.

4. Whether the district court properly rejected Appellees’ plea
for sovereign immunity where Appellees alleged facially valid violations
of the Texas Constitution and, for the non-takings claims, sought
prospective equitable relief against the TDA and various officials in their
official capacities.

xvi
INTRODUCTION
Appellants proffer no valid reason to disturb the district court’s
well-founded order denying Appellants’ plea to the jurisdiction.
Appellees properly sought prospective equitable relief against official-
capacity defendants for an ultra vires claim and against official-capacity

defendants and a state agency for the claims brought under the Texas
Constitution. Each of these claims overcomes Appellants’ sovereign
immunity because the detailed factual allegations render the claims
facially viable.
The pleadings also present an injury-in-fact fairly traceable to
Appellants’ conduct and that would be redressed by the relief sought,
establishing Appellees’ standing. Appellees’ federal claims under 42
U.S.C. § 1983 against official-capacity defendants also seek prospective
injunctive relief to redress ongoing violations of federal law and thus fall
within the Ex parte Young exception. In short, Appellants do not enjoy
immunity for the termination and disqualifications actions taken in
direct contravention of Appellees’ constitutional rights afforded by both
the Texas and U.S. Constitutions.

1
STATEMENT OF FACTS
Appellees pled a highly detailed account of the parties’ historic
relationship, the actions that gave rise to this lawsuit, and the legal
framework that governs those actions. CR.94-119 (¶¶33-114). For each
claim, the pleading specifically identifies its elements, the entities or

individuals against whom it is asserted, the relief sought, and the basis
for the Court’s jurisdiction. CR.91-93 (¶¶20-28, 115-218). While
Appellants urge a different standard, it is this pleading—not Appellants’
circumscribed retelling thereof—that must guide the Court’s assessment
of Appellants’ jurisdictional plea.
As detailed in the petition,1 Jaron Barganier and James Hong

founded Be A Champion, Inc. (“BAC”) in 2001, with the goal of serving
the youth in their community. CR.99-100 (¶¶52, 54). Over the next
decade, BAC expanded to also provide food services. CR.100 (¶¶53-56).
To expand the reach of that program, in 2014, BAC entered into a
Permanent Agreement (the “Agreement”) with the TDA to participate in
the Child and Adult Care Food Program (“CACFP”) and the Summer

Food Service Program (“SFSP”)—USDA programs that the TDA
administers in Texas. CR.100 (¶57). Under the Agreement, BAC
operated as an independent childcare center providing meals and snacks
to at-risk youth for free or at a reduced-rate cost. Id. For both programs,

1 In addition to the statement of facts, Appellees have appended a timeline of

relevant events as Appendix 1 to this brief.

2
BAC received federal reimbursements, allowing it to serve more
individuals at a lower cost. CR.86, 94 (¶35).

After executing the Agreement, BAC greatly expanded the scope of
its operations to reach a greater number of individuals in need. See
CR.101-03 (¶¶57-65). To that end, and with the TDA’s full knowledge,

BAC invested heavily in infrastructure, programming, and resources,
and grew its workforce to nearly 1,000 employees throughout Texas.
CR.100-01 (¶¶57-64); CR.117 (¶108).
As a part of the CACFP and SFSP program, the TDA would conduct
periodic audits of the participants to ensure compliance with the TDA’s
regulatory standards. Notably, at no point during the 11 administrative
reviews TDA conducted of BAC’s operations between 2014 and 2021 did
the agency ever issue BAC a serious deficiency finding, either for the
CACFP or the SFSP. CR.102 (¶63).

In early 2022, TDA conducted another, purportedly routine CACFP
review of BAC’s operations. CR.107 (¶78). The TDA officials who
conducted that review found no serious deficiencies. CR.107-08 (¶¶79-

80). Despite that outcome, Appellant Carey Spence Lenss, the former
Assistant Director of Community Operations for Food and Nutrition at
TDA—who was not involved in BAC’s CACFP review, instructed other

TDA employees to find and issue serious deficiency findings. CR.108
(¶¶70-71). During the exit conference that eventually followed, Lenss
claimed that other entities, unlike BAC, had zero food waste (an

3
allegation that was untrue) and that any waste amounted to a serious
deficiency (another untrue statement). CR.108 (¶80). Appellees later

learned that Lenss, aided by Appellants Laura Benavidez, Belia
Montelongo, and Celia Garcia, had targeted BAC, including by telling
TDA employees to elevate what should have been at most “findings” to

“serious deficiencies”—a designation that carried dire consequences for
BAC. CR.108 (¶81).
The “serious deficiencies” for which BAC was cited included things
like a single meal at a single location not being counted, a single meal at
a single location being inadvertently added to meal records, and
understandable confusion as to whether a school day ended at the end of

the school’s operational hours or at the (earlier) end of academic
instruction for each day. CR.109 (¶¶83-84). Notably, such “serious
deficiency” findings were inconsistent with the TDA’s own stated

regulatory standards, as well as nearly a decade of BAC’s past
interactions with the agency. CR.108 (¶84).
Between May and November 2022, the TDA conducted a

management review of the “serious deficiency” determination that
ultimately generated a “serious deficiency” finding the TDA issued to
BAC. CR.109 (¶85). At the same time, the TDA initiated an
administrative review of BAC’s SFSP participation. CR.103 (¶66). In
the initial exit interview following that review, BAC was advised that the
TDA found no serious deficiencies. Id. But, on the heels of that

4
interview, Lenss intervened and again instructed TDA employees to
issue new “serious deficiency” findings that did not match the TDA’s

regulations or past practices. CR.104 (¶¶67-68).
After issuing the serious deficiency notices, TDA told BAC to
submit a corrective action document (“CAD”). CR.110 (¶¶86-87).

Although regulations, as well as the TDA’s own Handbook, require the
TDA to provide notice of “[t]he actions to be taken to correct the serious
deficiency(ies),” the TDA failed to specify the corrective actions BAC
should include in the CAD. Compare 7 C.F.R. § 226.6(c)(3)(iii)(A)(2) and
4 TEX. ADMIN. CODE § 25.182; CR.110 (¶88) , with CR.111 (¶89).
BAC timely submitted a CAD that exhaustively addressed every

deficiency TDA identified. CR.111-12 (¶¶90-92). More specifically, BAC
proffered a 97-page document that demonstrated, with detail, exactly
how it would permanently correct each of the “serious deficiencies”

identified. See CR.112 (¶¶91-92). Thereafter, six months passed without
any response from the TDA, leading Appellees to believe the TDA had
accepted the CAD. CR.112 (¶93).

After submitting its CAD, BAC submitted its SFSP renewal
application in April 2023. CR.104 (¶69). Two days later, the TDA
summarily rejected that application, citing an “open” serious deficiency
finding that the TDA had never issued. CR.104-05 (¶69). As a result,
BAC found itself unable to operate as a SFSP sponsor for the first time

5
since 2014, leaving it in possession of approximately 130,000 summer
meals that ultimately went unserved. CR.105 (¶69).

On the heels of that SFSP determination, the TDA notified BAC
that its CAD had been rejected and told BAC it had 13 days to submit
corrected responses. CR.112 (¶¶93). Here again, the TDA provided no

notice or explanation as to why the CAD was rejected or what the TDA
expected to see in its stead. CR.113 (¶94). Acting without the benefit of
that guidance, BAC went on to generate an even more fulsome, 307-page
CAD in which it addressed every conceivable deficiency the TDA might
identify. CR.113 (¶95).
Shooting in the dark, but determined to avoid termination and a

permanent ban, Appellees also requested a meeting with TDA officials to
better understand what the CAD needed to include. CR.113 (¶95). BAC
met with several officials but received only very limited guidance with no

explanation as to what the TDA expected for BAC to cure the “serious
deficiencies” that remained. CR.113-14 (¶96). Thereafter, BAC
submitted a new CAD that tracked TDA’s limited guidance, expanding

the detail set forth therein from 307 to 410 pages (not including
supporting documentation). CR.114 (¶97).
Much like BAC had just experienced with the CACFP, the TDA
next notified BAC that the TDA had, for the first time, identified serious
deficiencies with its SFSP program in May 2023. CR.105 (¶70). In
response, BAC submitted a CAD that addressed all of the alleged

6
deficiencies. CR.105 (¶71). Months later, however, TDA notified BAC
that it was being terminated as a SFSP participant, falsely accusing BAC

of failing to demonstrate corrective actions that would address each
deficiency. CR.105-06 (¶72).
BAC timely appealed the SFSP termination. CR.106 (¶74). While

the TDA’s administrative review officer (“ARO”) refused to consider the
merits of the appeal, it concluded that the TDA had terminated BAC
without requesting additional information or clarification in
contravention of the governing regulations. CR.106 (¶¶74-75). The ARO
therefore reversed the SFSP decision. CR.107 (¶76). That victory,
however, ultimately proved hollow when the TDA placed Appellees on

the National Disqualification List, thereby precluding their participation
in any federally-funded food program, including the SFSP.
Around the same time the ARO reversed the SFSP termination, the

TDA notified BAC that it was being terminated as a CACFP participant.
CR.114 (¶99). The TDA included an assessment with that notice that,
for the very first time, advised BAC of the TDA’s expectations for the CAD

it already had rejected. CR.114-16 (¶¶99-102). Of course, at that point,
it was too late for BAC to respond in any meaningful way. CR.115
(¶¶ 100-01). Following that notice, BAC’s Agreement was terminated
and each Appellee was disqualified from “perform[ing] any Child
Nutrition Program function, participat[ing] as a daycare home provider,

7
or serv[ing] as a principal in any organization or site in the Child
Nutrition Programs.” CR.115-16 (¶¶102-03).

In December 2023, BAC appealed the termination and
disqualification order, requesting a hearing before the State Office of
Administrative Hearings. CR.116 (¶104). That request was denied and,

instead, a TDA officer oversaw a hearing at which BAC was not allowed
to challenge the merits of the TDA’s serious deficiency determination or
rejection of BAC’s extensive CADs. CR.116 (¶¶104-06). Without
considering the merits, the ARO issued a final order affirming the TDA’s
orders. CR.116-17 (¶¶106-07). As a result, BAC lost millions in funding
and was forced to lay off the overwhelming majority its employees. See

CR.103 (¶65); CR.117 (¶108). BAC and its directors also were placed on
the National Disqualification List—a list on which they will remain for
at least seven years absent relief afforded by this lawsuit. CR.115-16

(¶¶102-03).

SUMMARY OF THE ARGUMENT
Appellants’ jurisdictional challenges are unfounded and the district

court was right to reject them. While Appellants suggest that the
Uniform Declaratory Judgment Act (“UDJA”)’s waiver of sovereign
immunity bars Appellees’ claims, Appellees do not rely on—and, in fact,

have pleaded around—that waiver. Likewise, the ultra vires exception
to sovereign immunity applies to Appellees’ ultra vires claim and others
in which Appellees seek equitable relief for Texas constitutional

8
violations. Appellees plainly have standing to assert such claims, as they
assert an injury-in-fact that fairly is traceable to the Appellants’ actions

and would be redressed by the prospective relief Appellees seek.
Appellants’ challenges to Appellees’ other constitutional claims fare
no better. With respect to Appellees’ Section 1983 claims against the

Official Capacity Defendants, Ex parte Young applies and divests
Appellants of their asserted sovereign immunity—Appellees allege
ongoing violations of federal law, seek relief that is properly prospective,
and name officials who are sufficiently connected to the violations at
issue.
Appellees also have pleaded facially valid claims for Appellants’

violations of the Texas Constitution. First, as to procedural due process,
Appellees pleaded valid property and liberty interests implicated by
Appellants’ actions where Appellees were afforded insufficient notice or

process. Contrary to Appellants’ assertion, Appellees did not receive a
“full evidentiary hearing.” Indeed, Appellees were precluded from
challenging either the serious deficiency determination or the sufficiency

of their proposed CAD and, similarly, were prohibited from participating
in a name-clearing hearing despite the stigmatizing charges the TDA
lodged and publicized against them.
Second, Appellees pleaded facially valid substantive due process
claims, alleging that Appellants exercised their power in an arbitrary and
unreasonable way. While Appellants strain to construe the pleadings to

9
provide them with a legitimate interest justifying their actions, their
analysis flips the burden of proof on its head. In truth, the pleadings

must be constructed in Appellees’ favor which, when so viewed, clearly
demonstrate that Appellants had no legitimate interest in proceeding as
they did.

Third, Appellees have pleaded sufficient facts to render an equal
protection claim plausible. While Appellants argue otherwise, the
authority upon which they rely is inapplicable to TDA’s thoroughly-
regulated oversight of the CACFP. None of these constitutional claims is
barred by the “redundant remedies” doctrine, as the relief Appellees seek
under the Texas Administrative Procedures Act (“APA”) is not the same

as the relief Appellees request to remedy Appellants’ violations of the
Texas Constitution.
Finally, the Court should reject Appellants’ challenge to the takings

claim. By terminating and disqualifying Appellees, TDA created extreme
economic hardship and significantly interfered with Appellees’
reasonable investment-backed expectations in protected property

interests. Applying the requisite ad hoc factual analysis, the as-pleaded
allegations support a takings claim, warranting affirmance of the district
court’s order.

10
ARGUMENT

I. Appellants’ Arguments Regarding the Ultra Vires Exception
and Waiver Under the UDJA Miss the Mark.
Asserting sovereign immunity, the TDA and the Official Capacity
Defendants urge the Court to dismiss Appellees’ UDJA and ultra vires

claims for lack of jurisdiction. See App. Br. at 22-35. The Court should
decline this invitation, as Appellees do not rely on the UDJA’s limited
waiver provision, Appellees constitutional claims do not rely upon the
ultra vires exception, and Appellees have pleaded a valid ultra vires claim
that they plainly have standing to pursue.

A. The UDJA’s immunity waiver is not at issue.
While the amended petition cites the UDJA as a basis for Appellees’

request for declaratory relief, they have never invoked the waiver
provision of that Act to assert a jurisdictional hook for this or any other
claim. Compare App. Br. at 33, with CR.91-93. As such, there is no merit

to Appellants’ plea for dismissal grounded on any jurisdictional provision
of this Act, which amounts to a red herring.

B. Appellants are not immune from the ultra vires claim.
Appellants provide an overview of the ultra vires doctrine that,
while interesting, overlooks a key distinction between ultra vires claims
and claims brought pursuant to the Texas Constitution. See App. Br. at

23-24. For both sets of claims, while monetary damages are unavailable,
a plaintiff may pursue equitable remedies. See City of Elsa v. MAL, 226

11
S.W.3d 390, 381 (Tex. 2007) (citing Beaumont v. Bouillion, 896 S.W.2d
143, 144, 149 (Tex. 1995)). The difference lies in the identity of the

parties who may be held subject to suit for the two claims. More
specifically, an ultra vires claim “must be brought against the state actors
in their official capacity,” City of El Paso v. Heinrich, 284 S.W.3d 366, 373

(Tex. 2009), but “governmental entities may be sued for injunctive relief
under the Texas Constitution,” MAL, 226 S.W.3d at 381. These
important distinctions are telling of merits of Appellants’ plea for
immunity for both claims.

1. Appellees do not rely on the ultra vires exception
for claims against the TDA.
Contrary to Appellants’ contention, Appellees neither “rely on the
ultra vires exception to sue TDA” nor fail to “assert [a] viable waiver or
exception to TDA’s sovereign immunity for these claims.” App. Br. at 24.

Instead, Appellees facially invoke MAL, to waive sovereign immunity of
both the TDA and the Official Capacity Defendants for the injunctive
relief they seek. CR.91 (¶23). As such, this argument fails.

2. Appellees pleadings are facially sufficient to
establish Appellants’ ultra vires acts and to
demonstrate a lack of immunity for those acts.
Under the governing regulations and the TDA’s own handbook, the

TDA must give notice of any putative “serious deficiency” and provide the
specific corrective action(s) needed before terminating or disqualifying a
CACFP participant. CR.128-29 (¶148). The Official Capacity

12
Defendants violated these requirements by terminating and
disqualifying Appellees without providing appropriate notice, either with

respect to the nature of the “serious deficiencies” at issue or the
acceptable corrective actions that should be submitted. CR.128-29
(¶¶148-50). In so doing, they acted ultra vires. CR.129 (¶¶ 148-52).

“To fall within [the] ultra vires exception, a suit . . . must allege, and
ultimately prove, that the officer acted without legal authority or failed
to perform a purely ministerial act.” Heinrich, 284 S.W.3d at 372. “An
ultra vires claim . . . has two fundamental components: (1) authority
giving the official some (but not absolute) discretion to act and (2) conduct
outside of that authority.” Hall v. McRaven, 508 S.W.3d 232, 239 (Tex.

2017). “Sovereign immunity bars suits complaining of legal errors
stemming from the exercise of the officer’s absolute discretion but not
suits complaining of those errors stemming from an officer’s exercise of

limited discretion.” Hensley v. State Comm’n on Judicial Conduct, 692
S.W.3d 184, 201 (Tex. 2024) (emphasis in original).
Exercising its authority to administer the CACFP, the TDA must

“provide, in accordance with regulations promulgated by the Secretary,
an opportunity for a fair hearing and a prompt determination to any
institution aggrieved by any action of the State agency that affects the
participation of the institution in the program.” 42 U.S.C. § 1766(e)(1)(A)
(emphasis added); 7 C.F.R. § 226.6(c)(3)(iii) (“If the State agency
determines that a participating institution has committed one or more

13
serious deficiency[ies] . . . [it] must . . . provide the institution and the
responsible principals . . . notice of the serious deficiency(ies) and an

opportunity to take corrective action.”). The notice must specify the
serious deficiencies at issue, the actions that must be taken to correct
those deficiencies, and that a “failure to fully and permanently correct

the serious deficiency(ies) within the allotted time will result in denial of
the institution’s application,” as well as disqualification. 7 C.F.R.
§ 226.6(c)(3)(iii)(A)(1)-(2), (5). These requirements are repeated in the
CACFP Handbook and the TDA’s regulations. CR.110; 4 TEX. ADMIN.
CODE § 25.182 (“TDA will impose adverse actions against any contractor
for failure to comply with CACFP requirements in accordance with 7

C.F.R. §226.6, TDA CACFP Handbooks, and this Division”).
In the notice letter Benavidez issued to BAC, she did not specify
any corrective actions BAC needed to take to remedy the deficiencies at

issue. CR.110-11. Indeed, the letter provided “no guidance about TDA
expectations for the corrective action plan” and said nothing about the
corrective actions the TDA would accept. CR.111 (¶89). Even after

Appellees submitted voluminous CADs to remedy the vague
“deficiencies” the TDA had identified, the TDA waited until after it
already had terminated BAC as a CACFP participant (and, in turn, a
SFSP participant) to provide the requisite CAD guidance. CR.110-15.
The Official Capacity Defendants had no authority to operate in this
manner, which plainly violated the notice requirements set forth in the

14
TDA’s own regulations. See TEX. AGRIC. CODE § 12.0025(6); 42 U.S.C.
§ 1766(e)(1)(A); 7 C.F.R. § 226.6; see also, e.g., Rodriguez v. Serv. Lloyds

Ins. Co., 997 S.W.2d 248, 254 (Tex. 1999).
TDA’s immunity defense is similar to that which the Third Court
rejected when the Public Utility Commission (“PUC”) attempted to raise
the very same defense in Texas Telephone Association v. Public Utility
Commission of Texas, 653 S.W.3d 227 (Tex. App.—Austin 2022, no pet.).
There, the PUC created regulations to govern its administration of the
Texas Universal Service Fund (“TUSF”)—a fund the legislature charged
the PUC with administering to ensure affordable telecommunications
service across Texas. Id. at 237. After the PUC stopped paying the full

amounts due under the PUC’s own orders, rural telecommunications
providers sued, alleging that the PUC officials’ actions were “ultra vires
because they violated the policies and practices established by [the

statute], the Commission’s rules, and the Commission’s orders.” Id. at
244. Responding, the PUC asserted that its officials had “essentially
unconstrained discretion” because the Commissioner had statutory
authority to “act as necessary and convenient to administer the funds
and this chapter.” Id. at 250.
The Third Court rejected this “boundless discretion” argument,

finding it “[s]ignificant[]” that PUC officials were not following their “own
rules.” Id. at 251, 254. Finding the pleadings “sufficient to confer the
trial court with jurisdiction,” the Court concluded that the “[statute], the

15
Commission’s own rules, and the Commission’s final orders establishing
monthly support amounts all constrain the Commission and its

Commissioners’ limited discretion” and that, by acting contrary to these
constraints, “the Commissioners acted without legal authority.” Id. at
253-54. The same analysis applies to the TDA officials’ ultra vires acts

in this case, which similarly were undertaken without legal authority in
direct contravention of the TDA’s own rules. Compare, e.g., id. at 251.
As such, the district court did not err in denying Appellants’ plea to the
jurisdiction as to Appellees’ ultra vires claim.

3. Appellees seek logically necessary relief.
Appellants also assert—for the very first time on appeal—that
Appellees’ “requested relief is not logically necessary to give effect to the
CACFP’s regulations.” See App. Br. at 28. Advancing this argument,
appellants rely on Image API, LLC v. Young, wherein the Court allowed
the Health and Human Services Commission (“HHSC”) to recoup audit-
confirmed overcharges from a Medicaid contractor even though the
HHSC conducted the audit beyond the mandatory statutory deadline.
691 S.W.3d 831, 834 (Tex. 2024). In Young, however, the contractor did
not object to the audit when it was being conducted or the results of that
audit showing that the contractor, in fact, had been overpaid. Id. at 843-
44. As such, the Court found that the requested remedy—an order
precluding the HHSC from seeking recoupment of the overpayment—

16
would not be “logically necessary” to give effect to the governing statute
requiring the audit to be completed within a certain deadline. Id. at 843.

Here, by comparison, the regulations require the TDA to provide
notice of both the serious deficiency and the corrective action needed to
resolve that deficiency for the very purpose of providing the recipient a

meaningful opportunity to “fully and permanently correct [the issue]
within the allotted time.” 7 C.F.R. § 226.6(c)(3)(iii)(A)(2), (5); see also
CR.110; 89 FR 13150-51. These requirements, in fact, are designed to
help the TDA “document the case to terminate and disqualify non-
performing CACFP institutions that are unwilling to or incapable of
resolving their serious deficiencies.” Id. at 13151 (emphasis added).

BAC is not such an “unwilling” or “incapable” institution. Instead, BAC
would have complied with the TDA’s instructions regarding an
acceptable CAD—instructions the TDA never provided in violation of the

governing regulations. CR.111-15. To remedy this ultra vires notice
failure, Appellees seek to restore the status quo that existed at the time
the failure occurred, CR.129 (¶151), by allowing them to cure the

deficiencies the TDA identified for the first time in its final termination
letter and requiring the TDA to identify any future deficiencies and the
actions needed to correct them before termination decisions are made, id.

17
4. Appellants lack “absolute discretion” to ignore
regulations or terminate BAC’s CACFP
participation without appropriate notice.
The Official Capacity Defendants gave notice of a deficiency
without actually finding an actionable deficiency, rejected BAC’s CAD
that strictly followed the TDA’s limited instructions, and terminated and

disqualified BAC without an actionable violation or appropriate notice.
See, e.g., CR.128-29. While Appellants suggest that they had effectively
absolute discretion to take these actions, thereby affording them with
immunity, App. Br. at 26-27, absolute discretion is far more limited. See
Houston Belt & Terminal Ry. Co. v. City of Houston, 487 S.W.3d 154, 163
(Tex. 2016) (“absolute” discretion means “free decision-making without
any constraints”); see also id. at 167 (juxtaposing “absolute” and “limited”
discretion based on whether officer discretion “is otherwise constrained
by the principles of law”).
Here, the Official Capacity Defendants did not have absolute
discretion with respect to the administration of the CACFP. Rather, they
were required to comply, among other things, with 7 C.F.R. § 226.6 and
the TDA CACFP Handbook, both of which cabined their discretion to
oversee “the Serious Deficiency Process” and termination and
disqualification decisions. 4 TEX. ADMIN. CODE § 25.182. The regulations

also impose substantive limitations on the TDA’s discretion, cabining
“serious deficiencies” to a pre-defined list, rather than any aspect of an
institution’s CACFP participation with which a TDA official may take

18
issue. See CR.96 (citing 7 C.F.R. § 226.6(c)(3)(ii); CACFP Handbook at
§ 10000, 10-11). Respectfully, the Court need look no further than the

face of Appellees’ pleading—a pleading that demonstrates that the TDA
officials plainly did not follow these rules—to uphold the district court’s
denial of the plea. Compare, e.g., Houston Belt, 487 S.W.3d at 168-69

(directing courts to assess the pleadings to vet whether a plaintiff has
stated a valid ultra vires claim); Tex. Tel. Ass’n, 653 S.W.3d at 254
(holding, where rules constrained agency action, that pleaded conduct
taken in contravention of those rules supported an ultra vires claim).

5. Appellees have standing to bring an ultra vires
claim.
Appellees also have standing to obtain relief pursuant to their ultra
vires claim. Cf. App. Br. at 33-35. To establish standing, Appellees
simply must demonstrate (1) an actual or imminent injury that is

(2) fairly traceable to the challenged conduct and (3) likely to be redressed
by the requested remedy. Heckman v. Williamson County, 369 S.W.3d
137, 154-55 (Tex. 2012).

First, Appellees allege injuries-in-fact: the termination of their
CACFP (and, in turn, SFSP) participation, which cost them millions and
barred them from participating in any child nutrition program for at least
seven years. CR.103-19. Second, these injuries are fairly traceable to the
conduct of each Official Capacity Defendant, whose individual
involvement is set forth on a paragraph-by-paragraph basis that

19
Appellants have not challenged. Id. Third, Appellees’ requested
remedy—reinstatement and an opportunity to receive appropriate notice

and submit a responsive CAD with guidance from the TDA—would
redress the injury created by Appellants’ ultra vires acts. CR.129-30; see
also, e.g., Hartzell v. S.O., 672 S.W.3d 304, 319 (Tex. 2023) (holding that

“restoration of [plaintiff’s] degree on a forwards-looking basis” was
prospective relief and that “an injunction ordering the degree reinstated
and the penalty removed from her records pending a new hearing would
be appropriate”); cf. Nelson v. Univ. of Tex. at Dallas, 535 F.3d 318, 324
(5th Cir. 2008) (holding that “a request for reinstatement is . . . a claim
for prospective relief”).

Appellants challenge as “speculative” the request that the TDA
officials be required to follow their regulations when dealing with BAC in
the future. App. Br. at 34-35. Not so. Given the interactions that led to

BAC’s termination and disqualification, it is far from speculative that,
absent a judicial order, the TDA will not comply with the rules requiring
it to provide sufficient notice and an opportunity to cure—the relief

Appellees seek. CR.52-119. Appellants’ assurances to the contrary—that
it will now abide by its regulatory duties in the future despite not doing
so in the past—ring especially hollow in a suit in which TDA officials also
claim to have absolute discretion to administer the CACFP in any
manner they see fit, including one that violates their own rules. Cf.
Speech First, Inc. v. McCall, 138 F.4th 219, 223-24 (5th Cir. 2025) (when

20
the defendant is still defending the challenged policy, it suggests a live
dispute).

II. The Pleadings Plausibly Demonstrate Appellees’ Standing
to Pursue All of Their Asserted Claims.
Appellants next argue that Appellees lack standing to pursue all

but their APA and takings claims. App. Br. at 35-37. As in the trial
court, however, Appellants do not articulate a reasoned basis for this
assertion, instead selecting “just a few problematic examples” to
highlight to the Court. Id. at 36; see also CR.541 (same). While the Court
should adjudicate the merit of those “few . . . examples,” Appellants have
waived their standing challenge to any other claim or party. See TEX. R.
APP. P. 38.1(f); Hampton v. Equity Trust Co., 607 S.W.3d 1, 6 (Tex. App.—
Austin 2020, pet. denied).
First, Appellants fail to attack Appellees’ standing to sue the TDA,

thereby waiving such challenge. Appellees, of course, do have standing
to sue the TDA, as the pleadings allege financial and reputational
injuries fairly traceable to the TDA’s actions that would be redressed by

the prospective relief requested. See CR.107-28; see also supra,
Argument, § I(5). For these reasons, Appellees also have standing to
pursue claims against the Official Capacity Defendants—claims that are

effectively claims against the TDA. Indeed, “[a] suit against a state
official in his official capacity ‘is not a suit against the official personally,
for the real party in interest is the entity.’” Texas A&M Univ. Sys. v.

21
Koseoglu, 233 S.W.3d 835, 844 (Tex. 2007) (quoting Kentucky v. Graham,
473 U.S. 159, 166 (1985)); see also Morgan v. City of Alvin, 175 S.W.3d

408, 414 (Tex. App.—Houston [1st Dist.] 2004, no pet.) (“A suit against
an [] officer in his official capacity is merely another way of pleading a
suit against the governmental entity of which the officer is an agent.”).

Appellants’ assertion that Appellees must allege each officials’
personal involvement to establish standing, App. Br. at 35-36, simply is
wrong. See Koseoglu, 233 S.W.3d at 844. Indeed, the Texas Supreme
Court has rejected any such requirement. Heckman, 369 S.W.3d at 158.
In Heckman, a class brought claims against a constitutional county
judge, three county court at law judges, and a magistrate judge. Id. Even

though there was “undisputed evidence that a visiting judge” had
committed the alleged constitutional infraction, rather than “any of the
defendant county court at law judges,” id. at 144-45, the Heckman Court

found that plaintiffs had standing because their claims were asserted
against the defendant judges in their official capacities, id. at 158. Thus,
while the alleged injury was not “fairly traceable” to the individual

officials, it was “fairly traceable” to their offices, providing plaintiffs
standing to sue those offices. Id. at 157-58. The same is true here, where
Appellees allege wrongdoing on the part of TDA officials that is “fairly
traceable” to the office of the TDA.
Appellants also assert that claims against “high-ranking officers”
named only in their official capacities, CR.85, should be dismissed for

22
lack of standing because there is no allegation that they personally
violated Appellees’ constitutional rights. App. Br. at 35-36. At the same

time, Appellants argue that “low-level officials” should be dismissed
because there are insufficient allegations to demonstrate their authority
to effectuate the relief BAC seeks. Id. at 36. In advancing these

competing arguments, Appellants construct an artificial Catch-22
pursuant to which Appellees cannot obtain any relief, because high-level
officials purportedly lack personal involvement, but low-level officials
purportedly lack sufficient authority to effectuate relief. Id. This, of
course, is not the law. See, e.g., Heckman, 369 S.W.3d at 157-58.
Finally, as to the Section 1983 claims Appellees brought against the

Individual Capacity Defendants, Appellees have alleged facts
demonstrating the requisite causal connection to establish standing.
CR.134-39. “To prove traceability, Plaintiffs must allege ‘a causal

connection between the injury and the conduct complained of.’” Book
People, Inc. v. Wong, 91 F.4th 318, 332 (5th Cir. 2024). “The causation
element does not require a party to establish proximate causation, but

only requires that the injury be ‘fairly traceable’ to the defendant.”
LULAC v. City of Boerne, 659 F.3d 421, 428 (5th Cir. 2011) (citing Bennett
v. Spear, 520 U.S. 154, 168-69 (1997)).
Appellants further suggest that standing requires Appellees to
allege that their injuries would not have occurred but for the specific
actions of each individual defendant. App. Br. at 36. But in Air Evac

23
EMS, Inc. v. Texas Department of Insurance, Division of Workers’
Compensation, the Fifth Circuit rejected exactly this species of argument,

holding that the actions that “initiate[d] the first step in the [] process”
that plaintiffs challenged were not “too attenuated to be the cause of [the
plaintiff’s eventual] injury.” 851 F.3d 507, 514 (5th Cir. 2017). Here, too,

the Individual Capacity Defendants’ actions are not so attenuated to
preclude a finding of standing; rather, the pleadings describe specific
actions taken by the individual defendants that are fairly traceable to the
injuries Appellees ultimately experienced (termination from the CACFP
and SFSP, loss of funding, and disqualification). See CR.103-19 (¶¶66-
114). Nothing more is required and Appellants’ standing challenge

should remain rejected.

III. Appellees’ Section 1983 Claims Fall Under Ex Parte Young.
Ex parte Young provides an exception to sovereign immunity for
federal claims against state officials sued in an official capacity. Edelman
v. Jordan, 415 U.S. 651, 664-68 (1974) (citing Ex parte Young, 209 U.S.
209 (1908)). Appellants argue that Ex parte Young does not apply
because (1) the Official Capacity Defendants lack a sufficient connection
to the challenged acts and (2) Appellees do not allege ongoing violations
of procedural due process, substantive due process, or equal protection.
App. Br. at 37-38. Both arguments fail.
First, to establish a sufficient causal connection, Appellees simply
must plead that the state official has “some connection with the

24
enforcement of the challenged act.” Ostrewich v. Tatum, 72 F.4th 94, 100
(5th Cir. 2023). Where, for example, the suit involves enforcement of a

challenged law, challengers need only show a “scintilla of enforcement”
by the official. City of Austin v. Paxton, 943 F.3d 993, 998 (5th Cir. 2019).
Appellees easily meet that standard here, as each TDA official named in

an official capacity is alleged to have some connection with the unlawful
actions at issue, either personally or through their office. See CR.134-41.
Second, “[a]s long as the claim seeks prospective relief for ongoing
harm, the fact that a current violation can be traced to a past action does
not bar relief under Ex parte Young.” Williams on Behalf of J.E. v.
Reeves, 954 S.W.3d 729, 738 (5th Cir. 2020). Thus, for example, a state

employee who claims to have been terminated in violation of federal law
experiences an ongoing violation until reinstatement, even though the
termination is a one-time, past event. Nelson, 535 F.3d at 324 (holding

that “a request for reinstatement is . . . a claim for prospective relief
designed to end a continuing violation of federal law”).
The same is true in Texas. In Hartzell v. S.O., for instance, a

graduate student sued a university for allegedly violating her due process
rights when it revoked her doctoral degree—an action she sought to
remediate with injunctive relief in the form of an order reinstating her
degree and removing any indication of a prior revocation from her record.
672 S.W.3d at 319. “The University officials argue[d] that these claims
remain[ed] barred by sovereign immunity because [the plaintiff] [sought]

25
only ‘backwards-looking’ retrospective relief to rectify an ‘already-
complete governmental action.’” Id. The Court disagreed, holding that

the “restoration of her degree” was prospective and that “an injunction
ordering the degree reinstated and the penalty removed from her records
pending a new hearing would be appropriate,” should she prevail. Id. at

320. In other words, the fact that the wrong had occurred in the past did
not provide the University officials with their asserted immunity. Id.
Here too, the Official Capacity Defendants’ violation of federal law
is ongoing, as the wrong they committed resulted in Appellees’
permanent termination and disqualification from the CACFP and SFSP
that Appellees seek to remedy by way of reinstatement. CR.115-17, 120,

136-39 (¶¶ 102-08, 119, 188, 193, 199); see also Reeves, 954 S.W.3d at 738.
The resulting harm is ongoing because, as long as Appellees remain on
the National Disqualification List, they are barred from participating in

any federal food program. Id. As such, Appellees have pleaded proper
Section 1983 claims for which Appellants are not immune pursuant to Ex
parte Young and its progeny. The Court should therefore affirm the

district court’s denial of Appellants’ plea.

IV. Appellees Pled Facially Valid Claims.
Typically, a plea to the jurisdiction does not implicate the merits of
the case. See Texas Ass’n of Bus. v. City of Austin, Tex., 565 S.W.3d 425,
431 (Tex. App.—Austin 2018, pet. denied). But in some cases, “the
jurisdictional inquiry may unavoidably implicate the underlying

26
substantive merits of the case when, as often happens in ultra vires
claims, the jurisdictional inquiry and the merits inquiry are intertwined.”

Chambers-Liberty Counties Navigation Dist. v. State, 575 S.W.3d 339,
345 (Tex. 2019); see also Andrade v. NAACP of Austin, 345 S.W.3d 1, 11
(Tex. 2011) (holding that immunity from suit is not waived if the

constitutional claims are facially invalid). Even when analyzing whether
the pleadings allege a facially valid claim, however, courts must construe
the pleadings liberally in favor of the plaintiff. Tex. Ass’n of Bus., 565
S.W.3d at 435-36. Applying this standard, Appellees’ procedural due
course of law, substantive due course of law, equal protection, ultra vires,
and takings claims are facially valid and plainly overcome Appellants’

plea for sovereign immunity.2

A. Appellees’ procedural due-course of law claim based on
a property interest is facially valid.

1. Appellees allege a valid property interest.
It is well established that a contract can create a property interest.
See Bishop v. Wood, 426 U.S. 341, 344 (1976); Honors Academy, Inc. v.
Tex. Educ. Agency, 555 S.W.3d 54, 61 (Tex. 2018). Here, the pleadings

and the reasonable inferences drawn therefrom show that Appellees’
contract with the TDA created a property interest for the duration of the

2 Appellants do not present a merits-based jurisdictional challenge to
Appellees’ federal constitutional claims, and for good reason. “[T]he inquiry
into whether suit lies under Ex parte Young does not include an analysis of the
merits of the claim.” Verizon Md., Inc. v. Public Serv. Comm’n of Md., 535 U.S.
635, 646 (2002).

27
contract, requiring the TDA to afford meaningful process before
termination.

“[A] privilege that cannot be taken away except for good cause may
rise to the level of a vested property right that the due-process and due-
course clauses protect.” Texas Dep’t of State Health Servs. v. Crown

Distrib. LLC, 647 S.W.3d 648, 656, 656 n.22 (Tex. 2022) (citing House of
Tobacco v. Calvert, 394 S.W.2d 654, 657 (Tex. 1965)). “Some substantive
limit on the State’s discretion is an essential characteristic of a property
interest warranting constitutional protection.” Grounds v. Tolar Indep.
Sch. Dist., 856 S.W.2d 417, 418 (Tex. 1993). “[O]nce the state has granted
a privilege to conduct one’s business or profession, such privilege may

become a right protected by due process.” Limon v. State, 947 S.W.2d
620, 626 (Tex. App.—Austin 1997, no writ). “[I]n those situations due
process applies to protect the claimant from arbitrary revocation or

suspension of the right to conduct business during the term such right
was granted.” Id. (emphasis in original).
For example, in Teeuwissen v. Hinds County, Mississippi, by and

through its Board of Supervisors, a state law authorized the defendant, a
government board, “to employ counsel by the year.” 78 F.4th 166, 168
(5th Cir. 2023). Pursuant to that law, the board hired counsel for a one-
year term via contracts that required payment for a full year’s worth of
work, even if terminated early. Id. at 169-70. Three months later, the
board terminated the contracts and refused to issue any additional

28
payments. Id. at 169. In response, counsel raised a Fourteenth
Amendment challenge, alleging that the non-payment deprived them of

protected property interests. Id. The Fifth Circuit agreed, holding that
state law, coupled with the contracts, created “a protected property
interest in the money that the contracts’ early-termination provisions

guaranteed.” Id. at 170-71.
Likewise, in Grounds v. Tolar Independent School District, the
Texas Supreme Court considered the effect of the Term Contract Renewal
Act, which required “preestablished reasons for nonrenewal of teaching
contracts in addition to notice and a hearing.” 856 S.W.2d at 418. The
Court compared the effects of the Act to “an individual entitlement

grounded in state law, which cannot be removed except ‘for cause,’”
concluding that the statute’s “requirement of preestablished reasons for
nonrenewal constitutes a substantive limit on the State’s discretion

creating a property interest.” Id. (quoting Logan v. Zimmerman Brush
Co., 455 U.S. 422, 430 (1982)). “The fact that the State retains some
discretion in its decisions does not preclude the existence of a property

interest.” Id.; see also County of Dallas v. Wiland, 216 S.W.3d 344, 349,
353-54 (Tex. 2007) (holding that manual which created “expectation in
continued employment except for just cause” generated a “property
interest of which employees may not be deprived without due process”).
Here, BAC executed a “Permanent Agreement” with the TDA,
which constituted “a legally binding document between TDA and [BAC].”

29
CR.95, 100-01 (¶¶37, 57-64); see also 4 TEX. ADMIN. CODE § 25.31 (“The
agreement is a legally binding document that specifies the rights and

responsibilities of both the contractor and TDA”). By its terms, the
Agreement is durational, renewed every federal fiscal year. CR.95 (¶38).
The pleadings allege—and the applicable regulations confirm—“[w]hen
TDA decides to terminate an agreement with a contracting entity like
BAC, it must do so ‘according to [the governing C.F.R. provisions]; [42
U.S.C. § 1766)]; and TDA CACFP Handbooks.’” CR.95-96 (¶41) (quoting
4 TEX. ADMIN. CODE § 25.183). As such, there is a substantive limit on
the State’s discretion to terminate a contract mid-term, as the TDA did
in this case, and the Agreement, coupled with the governing regulations,

created a protected property interest for the contract’s duration. See
Teeuwissen, 78 F.4th at 168-70; Grounds, 856 S.W.3d at 418.
Arguing otherwise, Appellants contend that the TDA could

terminate the Agreement with BAC at any time. App. Br. at 40 (citing 7
C.F.R. § 226.6(b)(4)(ii)). That provision, however, is not so broad,
providing that “[t]he State agency or institution may terminate the

agreement at its convenience for considerations unrelated to the
institution’s performance of Program responsibilities under the
agreement.” 7 C.F.R. § 226.6(b)(4)(ii) (emphasis added). “However, any
action initiated by the State agency to terminate an agreement for its
convenience requires prior consultation with [the USDA].” Id.
(emphasis added). Critically, “[t]ermination for convenience does not

30
result in ineligibility for any program authorized under this part or
parts 210, 215, 220, or 225 of this chapter.” Id. (emphasis added).

As is clear from this language, there are three key problems with
Appellants’ assertion that the regulation negates Appellees’ property
interest. First, a termination that requires the TDA to consult with a

federal agency before effectuating a termination is not “discretionary.”
Second, a “convenience” termination cannot result in program
ineligibility, yet BAC and each individual Appellee were put on the
National Disqualification List when BAC’s contract was terminated. See
7 C.F.R. § 226.6(b)(4)(ii). Third, a convenience termination plainly is not
what happened here. The TDA terminated BAC’s contract due to alleged

“serious deficiencies,” did not consult with the USDA to effectuate that
termination, and disqualified Appellees from participating in the
CACFP, the SFSP, or any other federal nutrition program. Lacking any

authority supporting the TDA’s discretion to terminate BAC’s contract
for cause, BAC and its directors were afforded process that they plainly
did not receive.

The Agreement, state and federal regulations, and the CACFP
Handbook each imposed substantive and procedural limits on
Appellants’ discretion to terminate the Agreement and place Appellants
on the National Disqualification list. Together, these authorities created
a property interest for the duration of the Agreement of which Appellees
were deprived, triggering due process guarantees.

31
2. Appellees’ assertion of deficient process is facially
valid.
“The fundamental requirement of due process is the opportunity to
be heard ‘at a meaningful time and in a meaningful manner.’” Mathews
v. Eldridge, 424 U.S. 319, 333 (1976) (quoting Armstrong v. Manzo, 380

U.S. 545, 552 (1965)). “It is axiomatic that due process . . . calls for such
procedural protections as the particular situation demands.” Greenholtz
v. Inmates of Neb. Penal & Corr. Complex, 442 U.S. 1, 12 (1979); see also

Univ. of Tex. Med. Sch. at Houston v. Than, 901 S.W.2d 926, 930 (Tex.
1995). Here, the “particular situation” demanded more process than the
TDA allowed.
The due process analysis rests on a “balancing between the private
and governmental interests concerned.” SO Apartments LLC v. City of
San Antonio, Tex., 109 F.4th 343, 350 (5th Cir. 2024). Courts must

“balance three elements: the private interests at stake, the government’s
interest supporting the challenged procedure, and the risk that the
procedure will lead to erroneous decisions.” In the Interest of K.S.L., 538

S.W.3d 107, 114 (Tex. 2017). All three factors reveal the inadequacy of
the process Appellants afforded.
First, the affected private interests are significant. BAC has lost
millions in funding because of Appellants’ actions, resulting “in more
than 130,000 summer meals not being served to communities in need and
caus[ing] BAC to lay off more than 100 employees.” CR.103-04, 130, 134

32
(¶¶65, 69, 152, 181). In addition, each Appellee is now individually
barred from participation in any federally-backed school food and

nutrition program for at least seven years. CR.96, 99, 115-16, 120 (¶¶42,
51, 102, 119). “Not only have [Appellees] lost a huge source of funding
for public services, [the] public stigma associated with placement on

State and National Disqualification Lists serve[s] as a badge of shame.”
CR.125 (¶135).
Second, TDA’s interest in supporting the challenged procedure is
low. From a notice perspective, Appellants could have provided the
requisite notice at any point before sending BAC a final termination
letter, but intentionally withheld information until it was too late for

Appellees to respond. Notably, the notice Appellees seek is no more than
that which agency regulations already require. See, e.g., 7 C.F.R.
§ 226.6(c)(3). And, as for a meaningful opportunity to be heard, while

contracting entities can appeal adverse determinations to another TDA
official, CR.116 (¶104), they cannot challenge the substance of a serious
deficiency determination or argue the sufficiency of a proffered CAD. See

CR.124-25 (¶¶ 134-35). As such, the hearing is not meaningful, yet the
due process implications are significant. See Marco Outdoor Adver., Inc.
v. Reg’l Transit Auth., 489 F.3d 669, 673 (5th Cir. 2007) (“The ‘root
requirement’ of due process is ‘that an individual be given an opportunity
for a hearing before he is deprived of any significant property interest.’”
(emphasis in original)).

33
Third, there is a significant risk of erroneous deprivation if the
TDA’s process is allowed to stand. While Appellants baldly assert that

they afforded adequate process, App. Br. at 42-46, the pleadings allege
facts that create the reasonable inference that any process the TDA
afforded was not, in fact, meaningful or sufficient. At best, Appellees

were allowed to submit a CAD, but Appellants deliberately and
purposefully withheld notice as to what that document should contain
until they already had terminated BAC’s contract and disqualified it and
its principals. CR.111-16 (¶¶89-102). Indeed, it was only in the final
termination letter that the TDA provided new and surprising details
about the basis of its serious deficiency determinations and the reasons

it rejected BAC’s CADs. CR.114 (¶99), 121 (¶123). Those details
“demonstrate a classic example of ‘moving the goal posts,’ challenging
minute details of the plan by expressing criticisms that easily would have

been resolved had they been communicated at any time earlier in the
process.” CR.114 (¶99).
A careful review of the pleadings demonstrates just how little

process BAC was actually afforded. For example, while BAC “included
24 pages describing the step-by-step processes and procedures BAC had
adopted to ensure that all sponsored sites completed the meal count
forms according to program requirements,” CR.114 (¶98), the TDA
rejected the proposal because it “did not include any steps that indicate
that [BAC] will immediately follow up with the individuals who are

34
responsible for completing the meal count form,” CR.115 (¶100). Of
course, the TDA had never provided notice that such a requirement

would be imposed, let alone that its absence would lead to rejection of the
proffered CAD. CR.115 (¶101). Regardless, such a requirement was
completely unnecessary, as BAC’s proposal included a mandatory across-

the-board re-training designed to ensure that the identified issue did not
happen again at any individual site. Id. If nothing else, a decision like
this—of which BAC was never afforded a meaningful opportunity to
challenge—highlights the serious disconnect between the de minimus
process Appellees were afforded and the requisite constitutional process.

B. Appellees’ procedural due-course-of-law claim based
on a stigma-plus liberty interest is facially valid.
Appellants also deprived Appellees of a stigma-plus liberty interest.
See CR.120, 125 (¶¶119, 135). Such an interest arises when the

government takes an adverse action that creates a false and defamatory
impression, stigmatizing and foreclosing the party and foreclosing it from
other economic opportunities. See Bledsoe v. City of Horn Lake, Miss.,

449 F.3d 650, 653 (5th Cir. 2006). The combination of the adverse action
and the stigma gives rise to a protected liberty interest. Id.
Here, Appellants contest that: (1) Appellees were provided
insufficient notice or an opportunity to be heard before termination,
(2) the stigmatizing charges were false, (3) Appellees made a request for
a name-clearing hearing that was denied, and (4) stigmatizing charges

35
were made public. App. Br. at 47-49. The factual allegations, together
with the reasonable inferences drawn therefrom, more than support each

of these elements—something the district court properly recognized in
rejecting Appellants’ plea.
First, Appellees did not receive proper notice or a meaningful

opportunity to be heard before their termination. Notice of Appellees’
specific alleged wrongdoing was withheld until it was too late for BAC to
redress the concerns in any meaningful way to avoid contractual
termination and disqualification. CR.115 (¶¶ 100-01).
Second, Appellants made false charges against Appellees that were
so stigmatizing that Appellees (including the individual directors) are

now banned for seven years from participating in any federal food
program. See, e.g., CR.109 (¶¶83-84); 7 C.F.R. § 226.6(c)(7)(iv). While
Appellants assert that mere disagreement with the TDA’s

determinations does not equal falsity, App. Br. at 47, that does not afford
the pleading the deference it is due. As pleaded, BAC asserts far more
than a mere disagreement with TDA decision-making; rather, BAC

alleges that the facts upon which the TDA relied for its termination
determination were either inaccurate or so trivial that they could not
amount to a serious deficiency warranting the result that ultimately
transpired. CR.105-06, 131 (¶¶72, 157). The TDA’s published assertion
that Appellees engaged in conduct amounting to a serious,

36
disqualification-triggering deficiency, as defined in the applicable
regulations, therefore is false. Nothing more is required at this juncture.

Third, Appellees sought a name-clearing hearing by “request[ing] a
formal hearing before an ALJ at SOAH to present facts and
documentation in support of BAC’s continued plea for program

participation,” but the request was denied. See CR.116 (¶¶104-05). The
fact that Appellees did not recite the words “name-clearing” in their
request is irrelevant.
Fourth, after depriving Appellees of the opportunity to rebut the
TDA’s stigmatizing allegations, the TDA sent the disqualification notice
to the USDA, which, in turn, notified the world. See CR.120 (¶119).

Appellants argue that the disclosure was involuntary because, upon
finding a serious violation, TDA was obliged notify the USDA. App. Br.
at 48. But the Fifth Circuit authority Appellants cite holds only that a

voluntary act must cause the charges to be published. See Arrington v.
City of Dallas, 970 F.2d 1441, 1447 n.4 (5th Cir. 1992). Here, all of
Appellants’ actions were voluntary such that the disclosure is “fairly

attributable” to the TDA. See Hughes v. City of Garland, 204 F.3d 223,
227 (5th Cir. 2000); cf. Roe v. Patterson, 707 S.W.3d 94, 98 (Tex. 2025) (“a
person who supplies defamatory material to another for publication can
be liable for defamation”).
For all these reasons, the district court properly denied Appellants’
plea to the jurisdiction directed to the procedural due-course of law claim.

37
C. Appellees’ substantive due-course-of-law claim is
facially valid.
“[S]ubstantive due process ‘bars certain arbitrary, wrongful
government actions regardless of the fairness of the procedures used to
implement them.’” Lakey v. Taylor, 435 S.W.3d 309, 317 (Tex. App.—

Austin 2014, no pet.) (quoting Foucha v. Louisiana, 504 U.S. 71, 80
(1992)). “‘A violation of substantive due process occurs when the
government deprives individuals of constitutionally protected rights by

an arbitrary use of power.’” In re J.R., 652 S.W.3d 508, 514 (Tex. App.—
Houston [14th Dist.] 2022, pet. denied) (quoting Reynoso v. Dibs US, Inc.,
541 S.W.3d 331, 338 (Tex. App.—Houston [14th Dist.] 2017, no pet.));
Gatesco Q.M. Ltd. v. City of Hous., 503 S.W.3d 607, 618 (Tex. App.—
Houston [14th Dist.] 2016, no pet.) (government “violates Substantive
Due Process if it exercises its power in an arbitrary and unreasonable

way” (citing City of San Antonio v. TPLP Office Park. Props., 218 S.W.3d
60, 64-65 (Tex. 2007)). Under the governing test, “[plaintiff] must show
that it is not at least ‘fairly debatable’ that the [government’s] action was

rationally related to a legitimate governmental interest.” Id.; Reynoso,
541 S.W.3d at 339 (same); City of Richardson v. Bowman, 555 S.W.3d
670, 691-92 (Tex. App.—Dallas 2018, pet. denied) (same). Appellees meet
this test here.
While Appellants cite 1998 and 2007 authority to assert that
arbitrary government actions must shock the conscience to violate the

38
federal due process clause, they admittedly cite no such authority for the
Texas due course of law clause at issue in this case. Compare App. Br. at

50-51. That clause generates “at least some burden for protecting
individual rights that the United States Supreme Court determined were
not protected by the federal Constitution.” Patel v. Texas Dep’t of

Licensing & Reg., 469 S.W.3d 69, 98 (Tex. 2015). For example, a state
law whose real-world effect is so burdensome as to be oppressive in light
of the government’s interest would violate Texas’s substantive due course
of law protections even if it would not violate the federal due process
clause. See id. Given the number of published Texas appellate opinions
applying the rational basis test to government actions under the

substantive due course of law clause, see supra, Appellants have not
shown that the test is inapplicable to Appellees’ claim.

1. Appellees allege protected property and liberty
interests.
For the reasons set forth supra, Argument, §§ IV.A, Appellees have
alleged interests giving rise to substantive, as well as procedural,

protections. While Appellants argue that a stigma-plus liberty interest
only gives rise to a procedural due process claim, they cite no Texas or
even Fifth Circuit authority. See App. Br. at 48, 50. And, although the

Fifth Circuit has not squarely addressed this precise issue, it has charted
a different course in practice. In San Jacinto Savings & Loan v. Kacal,
for example, the plaintiff owned an arcade business that was shut down

39
by a campaign of police harassment. 928 F.2d 697, 703 (5th Cir. 1991).
Applying the “stigma-plus infringement” test, the Fifth Circuit held that

the plaintiff’s protected liberty interest was violated. Id. at 702-04. As
the Western District of Texas subsequently noted, “the holding of Kacal
appears to be grounded on a substantive due process theory.” Doss v.

Morris, Civ. No. SA-11-CV-00116-DAE, 2013 WL 2147460, at *6 (W.D.
Tex. 2013). Thus, in this Circuit—unlike the inapposite cases upon which
Appellants rely—a stigma-plus liberty interest can support a substantive

due process claim and does support such a claim on the facts Appellees
have pleaded. Compare, e.g., id.

2. Appellees allege arbitrary conduct.
As discussed, infra at 42-43, Appellees allege that a suspect
classification motivated Appellants’ conduct. Even in the absence of a
suspect classification, however, the allegations demonstrate a disconnect
between Appellants’ actions and any legitimate governmental interest.
Based on the pleadings, the CAD Appellees submitted before their
termination met every requirement the TDA had, to-date, articulated

and “followed [TDA] guidance to a tee.” CR.121 (¶123). Nevertheless,
the TDA still terminated Appellees’ participation in the CACFP, after the
fact citing new hyper-specific and arbitrary requirements it had never

disclosed during the months in which Appellees sought and requested
such guidance. See CR.115 (¶¶100-01).

40
Appellants argue that the pleadings reveal “legitimate program
violations at issue” and conduct that was rationally related to their

interest in ensuring that the program’s rules are followed. App. Br. at
48-50. But in their only cited example, Appellants note that the TDA
issued a citation for BAC submitting “attendance and meal form counts

[that] include[d] an entire calendar weeks’ worth of meal service on a
single form.” Id. at 49. Appellants argue this violated a regulation
requiring “[d]aily records indicating the number of participants in
attendance and the daily meal counts.” Id. (quoting 7 C.F.R.
§ 226.15(e)(4)). The regulation, however, does not require daily records
to be maintained on separate forms, and neither does it prohibit daily

records from being marked on a form containing seven days. 7 C.F.R.
§ 226.15(e). To put this in context, in the form at issue, the TDA did not
allege that BAC had miscounted meals or participants or that it had

delivered the services in an improper way. Instead, it claims to have
terminated the Agreement and blacklisted BAC and its principals for
seven years because BAC administrative combined more than one correct

daily count onto a single form—hardly a reason to terminate a contract,
withhold millions of dollars, and irreparably harm individuals and BAC
for years.
Notably, the TDA ever raised concerns about this same meal-count
form during any of the preceding eight years of BAC’s CACFP
participation. CR.109. Thus, nothing about the pleadings, which must

41
be construed “liberally in the pleaders’ favor,” Houston Belt, 487 S.W.3d
at 160, suggests that the TDA’s actions were in any way “rationally

related to a legitimate governmental interest,” Gatesco Q.M. Ltd., 503
S.W.3d at 618. On their face, the pleading is sufficient to demonstrate
jurisdiction, including for Appellees’ substantive due-course-of-law claim.

D. Appellees’ equal protection claim is facially valid.
Appellees’ equal protection claim is facially valid and is not barred
by sovereign immunity. “[T]o assert an equal-rights claim under article
I, section 3, a claimant must allege that it was treated differently from
other similarly situated parties, without a reasonable basis.” City of
Houston v. Downstream Env’t., L.L.C., 444 S.W.3d 24, 38 (Tex. App.—
Houston [1st Dist.] 2014, pet. denied). Here, Appellees’ pleading
establishes both requisite elements.

1. Appellees were treated differently in violation of
the Equal Protection Clause.
As set forth in the petition, Appellants treated BAC differently
based on the race and sex of BAC’s senior leadership members. CR.127
(¶142). The pleading, in turn, is based on the following factual

allegations: (1) other similarly situated entities engaged in similar
conduct, but, upon investigation, were not found to have a serious
deficiencies; (2) other similarly situated entities were allowed to cure
deficiencies that, unlike BAC’s CAD, the TDA accepted; and (3) other
similarly situated entities were given far more guidance than BAC

42
regarding acceptable CADs before they were subjected to termination or
disqualification decisions. CR.118 (¶112). BAC pleaded specific

examples to back up these allegations, including that Appellant Lenss
held BAC (and only BAC) to a “zero waste” standard that could not
possibly apply to any participant in the CACFP network, thereby

demonstrating the disparate treatment of BAC and its leaders based on
pretext. CR.108 (¶80). Under governing authority, these allegations are
sufficient to withstand Appellants’ plea.
In Texas Association of Business v. City of Austin, for example, the
City argued that an equal protection claim failed because the plaintiffs
“‘failed to plead allegations showing that the [challenged] Ordinance’

[mandating paid sick leave] [was] not rationally related to a legitimate
government purpose.” 565 S.W.3d at 435. The Court disagreed, noting
that the plaintiffs “asserted in their pleadings that ‘the City has no

governmental interest in mandating paid sick leave,’ and . . . explained
that, despite the City’s ‘findings,’ none of the purported interests is
legitimate as to the City. . . .” Id. “Construing the pleadings liberally in

the [plaintiffs’] favor and looking toward their intent, [plaintiffs] alleged
sufficient facts to affirmatively demonstrate the district court’s
jurisdiction.” Id. Significantly, the Court did not require the plaintiffs to
identify a specific comparator given their contention that the challenged
policy lacked a rational relationship to any legitimate government
purpose. See id.

43
Similarly, in City of Houston v. Downstream Environmental, L.L.C,
the plaintiff alleged that it was “singled out . . . with disparate treatment

that has no rational basis” and that the City had treated it differently
than other (unspecified) customers. 444 S.W.3d at 38. “Construing its
pleadings liberally, [the First Court] conclude[d] that [plaintiff’s]

allegations of arbitrary, capricious, irrational, and disparate treatment
state a constitutional claim based upon an unequal application of the law
without any reasonable basis.” Id. at 38-39. “As such, the equal-rights
claims are sufficient to survive a plea to the jurisdiction based solely on
the pleadings.” Id. at 39. Again, although the plaintiff did not identify
specific comparators in the pleading, this omission did not result in the

claim being barred. See id. at 38-39.
Here, Appellants’ challenge should suffer a similar fate. While
Appellants complain that Appellees failed to explain what they meant by

“similar” conduct, App. Br. at 53, “‘a dilatory plea does not authorize an
inquiry so far into the substance of the claims presented that plaintiffs
are required to put on their case simply to establish jurisdiction.’”

Downstream Env’t, 444 S.W.3d at 39 (quoting Bland Indep. Sch. Dist. v.
Blue, 34 S.W.3d 547, 554 (Tex. 2000)). As such, the Court should reject
Appellants’ attempt to impose a heightened pleading burden.3 See id.;

3 Appellants’ complaints about a lack of specificity in the pleadings ring
particularly hollow given the efforts they took to prevent Appellees from
obtaining the information they now argue is needed. See CR.118 (¶111);
CR.195-315.

44
see also City of Houston v. 4 Families of Hobby, LLC, 702 S.W.3d 698, 721
(Tex. App.—Houston [1st Dist.] 2024, pet. filed) (holding that similar

allegations were sufficient to overcome a plea to the jurisdiction on an
equal protection claim).
Appellants also complain that the pleadings do not specifically

allege that the same decision-makers were involved in the comparator
decisions. App. Br. at 54. But again, the standard is whether Appellees’
claims are facially valid, which Appellees have met. At a minimum, this
is a curable defect for which Appellees should be afforded an opportunity
to amend, not a basis for the dismissal Appellants seek.

2. Appellants had no reasonable basis for their
actions.
To demonstrate reasonableness, Appellants rely on two decisions
from the Courts of Appeals, neither of which bears the weight of

Appellants’ argument. See App. Br. at 54-56. In Rivera v. Sonnenschein,
the Third Court held that the plaintiff—a woman who sued the Texas
Board of Law Examiners after the Board denied her request for

admission because she did not have a J.D. from an ABA-approved law
school—had “not allege[d] facts showing that she was similarly situated
to other applicants or that the Board Members treated her differently
without a reasonable basis.” No. 03-21-00516-CV, 2022 WL 1751685, at
*1, *6 (Tex. App.—Austin 2023, pet. denied) (emphasis added). Because
her pleadings did not demonstrate incurable jurisdictional defects, the

45
Third Court remanded the claim to afford the plaintiff an opportunity to
amend. Id. at *6. Here, by comparison, Appellees have alleged that

Appellants treated them differently from similarly situated CACFP and
SFSP participants without a reasonable basis and included more facts to
support their disparate treatment claim than the plaintiff in Rivera.

The same is true of City of Floresville v. Starnes Inv. Group, LLC, a
case in which the Fourth Court rejected a plaintiff’s equal protection
claim where the pleading failed to describe “the nature of the different
treatment” at issue. 502 S.W.3d 859, 868 (Tex. App.—San Antonio 2016,
no pet.). Here, by contrast, Appellees allege specific facts regarding their
differential treatment by identifying specific ways BAC was treated

differently than otherwise similarly-situated comparators, including
with respect to the TDA’s serious deficiency determinations, its rejection
of BAC’s CADs, and the notice the TDA provided regarding its

expectations for those CADs in advance of any adverse determination.
CR.118 (¶¶112-13). The pleadings also identify a specific statement
made by an influential TDA official that demonstrated that BAC was

held to a different standard than any other program participant. CR.108
(¶80). On the basis of these allegations alone, the equal protection claim
is facially valid.

46
3. Engquist does not foreclose Appellees’
alternatively-pleaded class-of-one equal
protection claim.
Appellees also allege, in the alternative, that “even if no protected
category was involved, [Appellants’] actions would still violate Equal

Protection guarantees because they were irrational and arbitrary.”
CR.127 (¶143). Appellants argue that the Supreme Court has foreclosed
a “class-of-one” theory, applying caselaw that is vastly different than the

facts presented here. See App. Br. at 56-57.
In Engquist v. Oregon Department of Agriculture, a government
employee brought an equal protection claim, contending that her
employer terminated her employment for arbitrary reasons unrelated to
any protected category. 553 U.S. 591, 595 (2008). The Supreme Court
noted that government employees are needed to perform the tasks of
government and that government offices could not function if every
employment decision became a constitutional matter. Id. 598-99. On
these facts, the Court concluded that “[t]here are some forms of state

action[,] which by their nature involve discretionary decision-making
based on a vast array of subjective, individualized assessments.” Id. at
601-03. “In such cases the rule that people should be ‘treated alike, under
like circumstances and conditions’ is not violated when one person is
treated differently from others, because treating like individuals
differently is an accepted consequence of the discretion granted.” Id. at

603. The Court thus declined to “repudiat[e]” “the concept of at-will

47
employment” by recognizing a class-of-one equal protection claim in the
context of public employment. Id. at 606-07.

BAC is not a governmental employee, and this case has nothing to
do with public employment. Indeed, a government agency has far more
discretion in managing its at-will workforce than does a state agency, like

the TDA, charged with administering a program like the CACFP, where
its actions and decisions are cabined by a host of regulations. See CF.94-
99 (¶¶33-51); 2.RR.87:21-88:1. Moreover, unlike the facts in Engquist,
the TDA did not retain Appellees to perform a service for the TDA; rather,
Appellees accepted funds from the TDA to serve the public. CR.100, 105-
06 (¶¶56, 72). These facts do not lend themselves to an extension of

Engquist, whereby the word “employee” may be replaced with
“independent contractor.” Given the lack of precedential authority—or
even non-precedential authority—within the Fifth Circuit, this Court

should decline the invitation to extend Engquist’s holding to the facts of
this case.

E. The redundant remedies doctrine does not bar any of
Appellees’ otherwise facially-valid claims.
Appellants ask the Court to “find that the redundant remedies
doctrine bars counts 1-3 of [the] amended petition.” App. Br. at 58.

“Under the redundant remedies doctrine, courts will not entertain an
action brought under the UDJA when the same claim could be pursued
through different channels.” Patel, 469 S.W.3d at 79. In Patel, for

48
example, the plaintiffs brought a due process challenge to Texas’s
licensing regulations for eyebrow threading under the UDJA, alleging

that the regulations violated Texas’s due-course-of-law provision. Id. at
73, 76. The Court rejected the State’s attempt to dismiss the case based
on the “redundant remedies doctrine,” finding that the relief plaintiffs

sought went beyond reversal of the particular orders at issue. Id. at 74-
75. The same conclusion applies here.
A successful suit for judicial review under the APA only entitles the
appealing party to reversal of the agency’s decision or remand for further
proceedings. TEX. GOV’T CODE § 2001.174. “The available remedies on
appeal from an administrative finding are limited to reversal of the

particular orders at issue.” Patel, 469 S.W.3d at 79. As such, the district
court is not authorized to declare the order void or issue injunctive relief.
See id.; Tex. State Bd. of Pharmacy v. Steely, 764 S.W.2d 806, 815 (Tex.

App.—Austin 1988, writ denied) (district court had no authority to
declare “the Board’s orders ‘null and void’” or “enjoin[] permanently their
enforcement” despite concluding that “the district court properly

reversed the Board’s final order”).
Consistent with this limitation, Appellees invoke the APA to ask
the district court only to reverse TDA’s termination and disqualification
order. CR.133 (¶177). By contrast, in Counts 1-3 (claims for violations
of the Texas Constitution), Appellees ask the district court to go much
further and declare void “(1) TDA’s finding that BAC had ‘serious

49
deficiencies’ in its administration of the CACFP under its Permanent
Agreement with TDA, (2) TDA’s rejection of BAC’s CADs[,] and (3) TDA’s

decision to terminate BAC’s Agreement and disqualify Plaintiffs from
future CACFP participation.” CR.122 (¶127). Appellees also ask the
district court to issue prospective injunctive relief requiring Appellants

to remove Appellees from the National Disqualification List, restore
BAC’s eligibility to receive CACFP and SFSP payments, and issue
equitable relief designed to restore Appellees to the position they
occupied before Appellants’ unlawful actions. CR.122-23, 128 (¶¶128,
145). These remedies do not duplicate the far more limited relief
Appellees seek pursuant to the APA. Cf. Van Boven v. Freshour, 659

S.W.3d 396, 400-01, 404-05 (Tex. 2022) (board’s filing of a revised report
indicating that the plaintiff’s medical license was no longer restricted was
not the same as filing a void report, which would require withdrawing

the initial report in its entirety); In re Garza, 126 S.W.3d 268, 271 (Tex.
App.—San Antonio 2003, mandamus denied) (“A void order has no force
or effect and confers no rights; it is a mere nullity.”).

Finally, even if this Court were to accept Appellants’ redundant-
remedies argument, it would not warrant dismissal. “An injunction is an
equitable remedy, not a cause of action.” Brittingham v. Ayala, 995
S.W.2d 199, 201 (Tex. App.—San Antonio 1999, pet. denied). Similarly,
while the UDJA is “sometimes termed a ‘cause of action’ colloquially,” the
declaratory relief it authorizes “is more precisely a type of remedy that

50
may be obtained with respect to a cause of action or other substantive
right.” Craig v. Tejas Promotions, LLC, 550 S.W.3d 287, 297-98 (Tex.

App.—Austin 2018, pet. denied) (emphasis in original). Here, the “cause
of action or other substantive right” Appellees invoke seek to redress
violations of procedural due course of law, substantive due course of law,

and equal protection under the Texas Constitution. Compare, e.g., City
of Elsa, 226 S.W.3d at 392; Tex. Dep’t of Public Safety v. Martin, 882
S.W.2d 476, 482 (Tex. App.—Beaumont 1994, no writ). Thus, even if
Appellees’ UDJA-based request for declaratory judgment was dismissed,
that ruling would not affect Appellees’ claims for injunctive relief under
these other causes of action.

F. Appellees’ ultra vires claim is facially valid.
Seeking to obtain dismissal of Appellees’ ultra vires claim,
Appellants do nothing more than cross-reference their arguments for
immunity. App. Br. at 58. For the reasons set forth supra, Argument,
§ I, those arguments are baseless and provide Appellants with no
reasonable basis to contest the facial validity of Appellants’ as-pleaded
ultra vires claim. Having failed to mount a jurisdictional basis to dismiss
that claim, the district court’s order should be affirmed.

G. Appellees’ takings claim is facially valid.
To prevail on a takings claim, a plaintiff must show “(1) the
government engaged in affirmative conduct (2) that proximately caused
(3) the taking, damaging, destroying, or applying (4) of specific private

51
property (5) for a public use (6) without paying the owner adequate
compensation (7) and did so intentionally or with knowledge that the

result was substantially certain to occur.” Commons of Lake Hous., Ltd.
v. City of Hous., 711 S.W.3d 666, 676 (Tex. 2025). A regulatory taking
occurs when the regulation’s application “(1) requires an owner to suffer

a permanent physical loss or invasion of its property [], (2) completely
deprives an owner of all economically beneficial use of its property [], or
(3) unreasonably interferes with the owner’s right to use and enjoy its
property (often called a Penn Central taking).” Id. at 677 “Identifying a
Penn Central taking, however, requires the court to engage in an ‘ad hoc’
and ‘situation-specific’ factual inquiry, weighing multiple factors

including (1) the regulation’s economic impact on the owner, (2) the
extent to which the regulation interferes with the owner’s reasonable
investment-backed expectations, and (3) the character of the government

action.” Id.at 677-68.
As discussed above, in Texas Telephone Association, the Third
Court upheld a “takings” claim under very similar circumstances. 653

S.W.3d at 237. Applying the Penn Central factors, the Court found that
the PUC’s funding withdrawal had a dramatic economic impact on the
affected providers who never would have invested in rural
telecommunications infrastructure and services had they known PUC
would pull funding for those services. Id. at 269-70. In addition, the
Court determined that the PUC had “made a decision, made a plan to

52
implement that decision, and executed that plan,” thereby taking
“affirmative act[s] . . . they knew would result in underpayment.” Id.

Finding these allegations sufficient to demonstrate a facially-valid
taking, the Third Court reversed the district court’s plea order and
remanded the claim for an assessment of monetary damages. Id. at 272.

Similar to Texas Telephone Association, Appellees participated in
government-funded programs that the TDA was charged with
administering. The TDA took actions to terminate and disqualify
Appellees from participating in these programs, resulting in Appellees’
loss of millions of dollars in promised funding. See CR.103, 117, 134, 141
(¶¶65, 108, 181, 209). Relying on the promised funding, and with the

TDA’s full knowledge, BAC invested significant resources in its workforce
(expanding from a few hundred to over 1,000 employees), its physical
infrastructure (opening offices across greater Texas), and its software.

CR.100-03, 117 (¶¶57-65, 108). When Appellants acted to strip BAC of
that funding or any ability to participate in the CACFP, SFSP, or any
federally-funded food program, they plainly knew the decision would

generate a significant loss.
Seeking to avoid the reach of cases like Texas Telephone
Association, Appellants first assert that Appellees lacked a vested
property interest to support a takings claim. See App. Br. at 59. As
discussed, supra, Argument, §IV.A(1), that is factually incorrect, and also
flies in the face of Texas Telephone Association, which held that contract-

53
based funding, in fact, does provide a vested property interest. See 653
S.W.3d at 269 (identifying the property interest as the “depriv[ation]” of

“millions of dollars” in “monthly support”). Here, too, Appellees were
deprived of millions of dollars in contractual support. “The money in
question is, in essence, [BAC’s] property.” Tex. Workforce Comm’n v.

Midfirst Bank, 40 S.W.3d 690, 698 (Tex. App.—Austin 2001, pet. denied).
While Appellants did not possess Appellees’ physical property, it is well
established that property “is the bundle of rights that describe one’s
relationship to a thing and not the thing itself.” Jim Olive Photography
v. Univ. of Houston Sys., 624 S.W.3d 764, 774 (Tex. 2021).
Next, Appellants contend “‘[w]hen the government acts pursuant to

colorable contract rights, it lacks the necessary intent to take under its
eminent-domain powers.’” App. Br. at 59 (quoting State v. Holland, 221
S.W.3d 639, 643 (Tex. 2007)). Underlying Holland, however, is the

recognition that “the State wears two hats: the State as a party to the
contract and the State as a sovereign.” Gen. Servs. Comm’n v. Little-Tex.
Insulation Co., Inc., 39 S.W.3d 591, 599 (Tex. 2001) (superseded by

statute on other grounds). “The State, in acting within a color of right to
take or withhold property in a contractual situation, is acting akin to a
private citizen and not under any sovereign powers.” Id.
Here, as part of Congress’s intent to “safeguard the health and well-
being of the Nation’s children and to encourage the domestic consumption
of nutritious agricultural commodities and other food,” it authorized

54
grants-in-aid to the States. See 42 U.S.C. § 1751. To further this
objective, Congress authorized the creation of the CACFP and charged

state agencies—here, the TDA—with administering it. Id. at
§ 1766(a)(ii). In administering and disbursing appropriate funds via the
CACFP, the TDA wears its hat as sovereign, even if effectuates that

mandate by entering into contracts. See id. at § 1766(d)-(g); 7 C.F.R.
§ 226.6. Thus, when the TDA acted to terminate and disqualify
Appellees’ participation in the CACFP, it retained that sovereign hat and
cannot now claim that it lacked the necessary intent to take those actions
pursuant to the powers of eminent-domain. Compare App. Br. at 59.
Appellants also argue that Appellees were obliged to identify a

public use to which the withheld funds would have been put. See App.
Br. at 40-41. This, too, is inconsistent with governing authority. In
Webb’s Fabulous Pharmacies, Inc. v. Beckwith, for example, the Supreme

Court concluded that a taking had occurred when a county court claimed
the interest that had accrued on an interpleader fund deposited in the
registry of the court as its own. 449 U.S. 155, 155-56 (1980). The Court

concluded that the government lacked a justification for retaining the
interest, emphasizing that “[n]o police power justification [was] offered
for the deprivation.” Id. at 162-64. Far from rejecting the claim for lack
of an alleged public use, however, the Court concluded that the
government’s actions were “the very kind of thing that the Taking
Clause . . . was meant to prevent.” Id. at 164.

55
Similarly, in Midfirst Bank, the Texas Workforce Commission
(“TWC”) used money it had acquired from a delinquent debtor to pay off

wage claims and unemployment taxes of the debtors’ former employees.
40 S.W.3d at 692-94. A creditor with a perfected legal interest in the
same funds brought a takings claim against the TWC. Id. While the

TWC argued that no taking occurred because “its actions in recovering
the funds for wage claims were not in furtherance of a public purpose,”
the Third Court disagreed. Id. at 696 (“The fact that the benefit inures
to a specific group of people does not lessen the importance of
enforcement of the labor code to the public at large.”). Here, as with the
TWC, the TDA’s administration of the CACFP fulfills and furthers a

public purpose—the provision of meals to those in need.
Finally, Appellants suggest that allowing Appellees’ taking claim
to stand would open the floodgates for every terminated CACFP

participant to also raise a takings claim that the TDA would then have
to defend. See App. Br. at 61-62. But the jurisprudence applying Penn
Central is not so broad. Instead, the requisite analysis “is characterized

by ‘essentially ad hoc, factual inquiries,’ designed to allow careful
examination and weighing of all the relevant circumstances’” for the
particular case. Tahoe-Sierra Pres. Council v. Tahoe Reg'l Planning
Agency, 535 U.S. 302, 322 (2002). Here, the specific circumstances
regarding the economic impact and extent to which the TDA interfered
with BAC’s distinct investment-backed expectations are unusual, if not

56
entirely unique, given the TDA’s failure to follow its own guidelines and
regulations before effectuating the taking at issue. See Tex. Tel. Ass’n,

653 S.W.3d at 269.
Pursuant to its authority to administer a federal funding program,
the TDA deprived BAC of funds to which it otherwise was legally entitled

and interfered with investment-backed expectations in the process. At
this stage, Appellees’ burden to demonstrate the district court’s subject-
matter jurisdiction is merely to bring a “properly pled takings claim.”
Hearts Bluff Game Ranch, Inc. v. State, 381 S.W.3d 468, 476 (Tex. 2012).
As shown by the Third Court’s holdings in Texas Telephone Association
and Midfirst Bank, the pleadings here are more than sufficient to

establish the Court’s subject-matter jurisdiction over the takings claim,
and Appellants’ plea should remain rejected.

PRAYER
For the reasons set forth herein, Appellees Be a Champion, Inc.,
James Hong, Kevin Klotz, George Moon, and Jaron Bargainer
respectfully ask the Court to affirm the district court’s order denying the

amended plea to the jurisdiction. Appellees further request any other
relief, whether in law or in equity, to which the Court may find them
justly entitled.

57
Respectfully submitted,

TERRAZAS PLLC
1001 S. Capital of Texas Hwy.
Bldg. L, Suite 250
Austin, Texas 78746
512.680.3257

By: /s/ Kevin J. Terrazas
Kevin J. Terrazas
State Bar No. 24060708
kterrazas@terrazaspllc.com
Benjamin L. Dower
State Bar No. 24082931
bdower@terrazaspllc.com
Jennifer A. Foster
State Bar No. 24104938
jfoster@terrazaspllc.com

ATTORNEYS FOR APPELLEES

CERTIFICATE OF COMPLIANCE
As required by Rule 9.4(i)(3) of the Texas Rules of Appellate
Procedure, I certify that the foregoing Appellants’ Brief contains 13,239
words, excluding the parts of the document exempted by Rule 9.4(i)(1),
fewer than the 15,000-word maximum. I relied on the word count of

Microsoft Word, the computer program used to prepare the document, in
completing this certificate.

/s/ Benjamin L. Dower
Benjamin L. Dower

58
CERTIFICATE OF SERVICE
I hereby certify that on this 25th day of August 2025, a true and
correct copy of the foregoing was filed electronically, and notice of this
filing will be sent to all parties by operation of the Court’s electronic filing
system, including counsel for Appellants.

/s/ Benjamin L. Dower
Benjamin L. Dower

59
APPENDIX 1
Timeline of Relevant Events

DATE EVENT CITE

2001  Appellees Jaron K. Barganier and James Hong create CR.99-100
Be A Champion, Inc. (“BAC”), with mission of “us[ing] (¶¶ 52, 54)
sports, education, and nutrition programs to enhance
the development of youth. . . .”

2013  BAC introduces Fuel Food Programs to program CR.100 (¶
partners and serves more than 40,000 snacks/ suppers 56)
to eligible program participants each day.

2014  BAC enters into Permanent Agreement with Texas CR.100 (¶
Department of Agriculture (“TDA”) to participate in 57)
Federal Child and Adult Care Food Program (“CACFP”)
and Summer Food Service Program (“SFSP”). Under
Agreement, BAC acts as independent childcare center
providing meals and snacks to at-risk youth.

2015–22  BAC expands operations, employing more than 1,000 CR.101-03
employees. (¶¶58–65)
 TDA conducts eleven administrative reviews of BAC’s
operations without ever issuing serious deficiency
finding

Feb.–May  TDA conducts administrative review of BAC’s CACFP CR.102, 107-
2022 participation. The 6 TDA employees who conduct 09 (¶¶63,
review find no serious deficiencies. 78–84)
 Despite that determination, then-TDA employee Carey
Spence Lenss instructs other TDA employees to target
BAC and issue serious deficiency findings based on
minor issues such as a single meal not being counted, a
single meal being inadvertently added to meal records,
or a misunderstanding as to when a school day ended
(normal school hours versus end of academic
instruction).
 In exit conference, Lenss states other contracting
entities have zero food waste and that any food waste
constitutes serious deficiency (both untrue).
DATE EVENT CITE

May–Nov.  TDA conducts CACFP management review, wherein CR.109
2022 individual capacity Appellants apply disparate (¶85)
standards to BAC.

Sept. 2022  TDA initiates administrative review of BAC’s CR.103
participation in SFSP. Initial report contains no (¶66)
serious deficiency findings.
 Again, Lenss instructs TDA employees to target BAC
and issue serious deficiency findings.

Nov. 2022  TDA presents altered SFSP preliminary report with CR.103-04,
proposed serious deficiency findings inconsistent with 105-06, 110-
TDA’s past practices and regulatory standards. 11 (¶¶66–
68, 72, 86–
 TDA issues CACFP serious deficiency determination
89)
and requires corrective action document (“CAD”) but
fails to specify corrective actions as required by CACFP
Handbook and agency regulations.

Dec. 2022  BAC submits proposed CAD that exhaustively CR.111-12
addresses every deficiency TDA identified with respect (¶¶90–92)
to CACFP.

April 2023  BAC submits renewal application for SFSP. CR.104-05
(¶69)
 TDA rejects application citing “open” serious deficiency
finding—despite no finding—resulting in loss of
funding and 130,000 summer meals going unserved.

May 2023  After waiting 6 months, TDA notifies BAC that CAD CR.112-14
has been rejected and gives BAC 13 days to submit (¶¶93–96)
corrected documents. TDA provides no notice regarding
why prior CAD rejected.
 BAC submits 307-page CACFP CAD to address every
conceivable deficiency and requests meeting with TDA
officials to understand TDA’s expectations.

July 2023  TDA belatedly issues notice of serious deficiency CR.105, 113-
regarding SFSP participation. 14 (¶¶70–
71, 96)
 In response, BAC submits CADs completely addressing
TDA’s SFSP serious deficiency findings.
DATE EVENT CITE
 BAC leadership also meets with TDA officials to discuss
CACFP CAD, but TDA provides no explanation
regarding TDA expectations.

August  BAC submits revised CADs, expanding detail from 307 CR.114
2023 to 410 pages (without supporting documents). (¶97)

October  TDA sends BAC notice of termination and exclusion CR.105-07,
2023 regarding SFSP, falsely stating that BAC had failed to 113-16
demonstrate corrective actions that would address each (¶¶72–76,
purported deficiency. 96–102)
 In resulting hearing, administrative review officer
(“ARO”) concludes TDA failed to comply with federal
rules by terminating BAC’s SFSP participation.
 Final Order reverses TDA’s SFSP termination.
****
 TDA sends BAC notice of termination and exclusion
regarding CACFP that attaches a 21-page CAD
assessment that—for the first time—provides notice of
TDA’s expectations for the CAD.
 BAC’s CACFP and SFSP participation terminated and
excluded from “perform[ing] any Child Nutrition
Program function, participat[ing] as a daycare home
provider, or serv[ing] as a principal in any organization
or site in the Child Nutrition Programs.”

December  BAC appeals termination/exclusion decision and CR.116-17
2023 requests formal hearing before ALJ at SOAH. (¶¶103–08)
 BAC proceeds with hearing before ARO employed by
TDA. BAC not allowed to challenge serious deficiency
determination or rejection of CAD.
 Without considering merits, ARO issues final order
affirming TDA’s termination decision.
 BAC forced to reduce workforce by ~600 people and
cease operations.

2022–23  Appellees submit PIA requests on TDA’s treatment of CR.118
other entities. TDA withholds all information. (¶111)
Automated Certificate of eService
This automated certificate of service was created by the efiling system.
The filer served this document via email generated by the efiling system
on the date and to the persons listed below. The rules governing
certificates of service have not changed. Filers must still provide a
certificate of service that complies with all applicable rules.

Benjamin Dower on behalf of Benjamin Dower
Bar No. 24082931
bdower@terrazaspllc.com
Envelope ID: 104825920
Filing Code Description: Brief Not Requesting Oral Argument
Filing Description: Appellees' Brief on the Merits and Appendix
Status as of 8/26/2025 7:15 AM CST

Associated Case Party: Texas Department of Agriculture

Name BarNumber Email TimestampSubmitted Status

Thomas Ray thomas.ray@oag.texas.gov 8/25/2025 5:39:24 PM SENT

Todd Dickerson todd.dickerson@oag.texas.gov 8/25/2025 5:39:24 PM SENT

Associated Case Party: Be a Champion, Inc.

Name BarNumber Email TimestampSubmitted Status

Kevin Terrazas 24060708 kterrazas@terrazaspllc.com 8/25/2025 5:39:24 PM SENT

Benjamin Dower 24082931 bdower@terrazaspllc.com 8/25/2025 5:39:24 PM SENT

Jennifer Foster 24104938 jfoster@terrazaspllc.com 8/25/2025 5:39:24 PM SENT