GH America v. Fohn

Case: 25-50879 Document: 89-1 Page: 1 Date Filed: 10/16/2026 United States Court of Appeals for the Fifth Circuit United States Court of Appeals Fifth Circuit ____________ FILED October 16, 2026 No. 25-50879 Thomas B. Plunkett, III ____________ Clerk GH America Energy, L.L.C., Plaintiff—Appellant, versus Douglas Fohn, in his official capacity as Assistant General Counsel of the Electric Reliability Council of Texas, Inc. (“ERCOT”), Defendant—Appellee, Ken Paxton, Attorney General, State of Texas, Intervenor Defendant—Appellee, Pablo Vegas, Chief Executive Officer of the Electric Reliability Council of Texas, Inc.; Paul Foster, Member of the Board of Directors of the Electric Reliability Council of Texas, Inc.; Bill Flores, Member of the Board of Directors of the Electric Reliability Council of Texas, Inc.; Carlos Aguilar, Member of the Board of Directors of the Electric Reliability Council of Texas, Inc.; Linda Capuano, Member of the Board of Directors of the Electric Reliability Council of Texas, Inc.; Julie England, Member of the Board of Directors of the Electric Reliability Council of Texas, Inc.; Robert Flexon, Member of the Board of Directors of the Electric Reliability Council of Texas, Inc.; Peggy Heeg, Member of the Board of Directors of the Electric Reliability Council of Texas, Inc.; John Swainson,  Case: 25-50879 Document: 89-1 Page: 2 Date Filed: 10/16/2026 Member of the Board of Directors of the Electric Reliability Council of Texas, Inc.; Holly Heinrich, in her official capacity as a Legal/Regulatory Counsel of ERCOT, Defendants—Appellees. ______________________________ Appeal from the United States District Court for the Western District of Texas USDC No. 1:24-CV-648 ______________________________ Before Smith, Haynes, and Engelhardt, Circuit Judges.* Jerry E. Smith, Circuit Judge: This case turns on whether the CFIUS regime preempts LSIPA. The Texas Lone Star Infrastructure Protection Act of 2021 (“LSIPA”)1 prohibits certain contracts with foreign-owned companies or citizens of Russia, Iran, North Korea, and as relevant to this appeal, China. LSIPA prohibits such entities’ investment in critical infrastructure such as Texas’s electric grid, which is managed by the Electric Reliability Council of Texas, Inc. (“ERCOT”). The Committee on Foreign Investment in the United States (“CFIUS”) is the federal interagency task force that reviews foreign-facing financial transactions for national security and economic strategic risks. CFIUS originates in § 721 of the Defense Production Act of 1950, 50 U.S.C. § 4565 (the “DPA”).2 _____________________ * Judge Haynes concurs in the judgment. 1 Texas Legislature Online, S.B. No. 2116 (enrolled version) (https://perma.cc/5LJW-KEX9). 2 U.S. Gov’t Publishing Office, Pub. L. 81-774, The Defense Production Act of 1950, *33 (https://www.govinfo.gov/content/pkg/COMPS-8323/pdf/COMPS- 8323.pdf). In 2018, Congress passed the Foreign Investment Risk Review Modernization Act (“FIRRMA”) expanding the statutory authority for CFIUS to enable it to review minority positions, all investments involving critical technologies and sensitive personal 2  Case: 25-50879 Document: 89-1 Page: 3 Date Filed: 10/16/2026 No. 25-50879 GH America Energy (“GHAE”) is a Texas LLC and subsidiary of a Chinese company that sought to buy energy assets in Texas and was blocked by LSIPA. It brought a range of constitutional claims, including the pre- emption claims now on appeal, against Douglas Fohn, in his official capacity representing ERCOT. The district court granted defendants’ motion to dis- miss with respect to each claim.3 GHAE appeals solely on the preemption issue. GHAE insists that LSIPA is properly characterized as a statute targeting foreign investment per se, while Texas characterizes it as an energy-utility regulation within the heart of the state’s police power. We hold that the CFIUS regime does not impliedly preempt LSIPA because (i) GHAE fails to identify any conflict between LSIPA and the stat- utory text authorizing CFIUS and (ii) LSIPA is in purposive harmony with CFIUS and, if anything, provides even greater protection as a positive upward variance for Texan security. LSIPA is also not field preempted where Congress is silent and CFIUS does not amount to the kind of all- encompassing regulatory regime that ousts and precludes any related legislation. Because the CFIUS regime neither conflict- nor field-preempts LSIPA, we AFFIRM. I. LSIPA prohibits a governmental entity or critical infrastructure- related business from entering into an agreement with a company that is _____________________ data, and even real estate transactions close to sensitive United States sites and key infra- structure. See 50 U.S.C. § 4565 (granting CFIUS “[a]uthority to review certain mergers, acquisitions, and takeovers”). 3 GH Am. Energy LLC v. Vegas, 815 F. Supp. 3d 537, 558 (W.D. Tex. 2025) 3 Case: 25-50879 Document: 89-1 Page: 4 Date Filed: 10/16/2026 No. 25-50879 majority owned or controlled by a citizen of China or the Chinese govern- ment, or is headquartered in China, if the agreement would give that com- pany “direct or remote access to or control of critical infrastructure in this state.”4 “Critical infrastructure” includes the Texas grid managed by ERCOT.5 GHAE operates exclusively in Texas and is a subsidiary of Xinjiang Guanghui Industry Investment (Group) Company, Ltd., which is headquar- tered in China and majority owned by Sun Guangxin—a billionaire Chinese citizen who is neither a citizen nor resident of the United States. This case concerns ERCOT’s action in 2022, per LSIPA, denying GHAE’s request to interconnect a proposed solar-energy project, known as the Blue Star Solar Project (“Blue Star”), to the Texas grid. A. In 2015, Xinjiang and GH America Investments Group, Inc. (“GH America”), an oil-and-gas business unit affiliated with Xinjiang, gave notice to CFIUS regarding a proposed transaction by which Xinjiang and GH Amer- ica, through a subsidiary, would acquire assets of several U.S. companies (the “GH Transaction”). CFIUS delegated review to the Department of Defense (“DoD”),6 which determined that the GH Transaction presented a national security risk and informed Xinjiang and GH America that they would be required to enter a mitigation agreement with respect to the national security risks. CFIUS then concluded action on that transaction. From 2016 through 2018, Xinjiang and GH America, acting through _____________________ 4 Tex. Bus. & Com. Code § 117.002; Tex. Gov’t Code § 2275.0102. 5 Tex. Bus. & Com. Code § 117.001; Tex. Gov’t Code § 2275.0101(2). 6 Also known as the Department of War. 4 Case: 25-50879 Document: 89-1 Page: 5 Date Filed: 10/16/2026 No. 25-50879 subsidiary Texas LLCs, bought 131,290 acres of land in Val Verde County, Texas. In 2018, Xinjiang and GH America formed GHAE as a new subsidiary for renewable energy projects, and GHAE began investing in wind and solar resources as well as electric grid-connection consulting studies, intending to sell their energy into Texas. GHAE notified the DoD, which was still dele- gated oversight by CFIUS, and DoD objected to some of the renewable energy projects because of their proximity to Laughlin Air Force Base in Val Verde County. GHAE and CFIUS then updated the mitigation agreement to provide for expanded oversight. The Texas Legislature soon passed LSIPA, and when it came into effect in 2021, GHAE had pending ERCOT interconnection requests for sev- eral renewable energy projects, including Blue Star. As part of ERCOT’s generator-interconnection application process, GHAE informed ERCOT under LSIPA that it was majority-owned by Xinjiang. In October 2022, Fohn (ERCOT’s Assistant General Counsel) notified GHAE that it was noncompliant with LSIPA and that ERCOT was therefore canceling the Blue Star Solar Project’s interconnection application. GHAE claimed that that denial of its interconnection requests caused it to sell two other renewable energy projects (apart from Blue Star) “at a sub- stantial loss.” Yet GHAE persisted on Blue Star, asking ERCOT whether it could “pursue a screening study” to determine whether the land it had leased in Val Verde County was “interconnectable and saleable to potential customers who would be in compliance with” LSIPA, meaning it asked whether it could scrap the project for value. ERCOT denied that request as well, allegedly because of the sole fact that GHAE did not comply with LSIPA. GHAE maintains that, but for LSIPA, it would immediately submit interconnection requests to ERCOT for solar and wind energy projects in Val Verde County, 5  Case: 25-50879 Document: 89-1 Page: 6 Date Filed: 10/16/2026 No. 25-50879 notably, for Blue Star. In 2023, the Texas Legislature recognized a need to defend the elec- tric grid further and to bolster the security of Texas power against outside attacks. It therefore specifically commanded ERCOT not to register or pro- vide interconnections to a business entity “unless the business entity attests that [it] complies with” LSIPA.7 B. In June 2024, GHAE sued Fohn, ERCOT, and the other individual ERCOT-side defendants. GHAE asserted variously that LSIPA is pre- empted by the CFIUS regime and related statutes such as the DPA and FIRRMA; that LSIPA is unconstitutional under the Dormant Commerce Clause; and that LSIPA violates the Equal Protection Clause on account of race, ethnicity, alienage and national origin. GHAE sought injunctive and declaratory relief and damages. Following the defendants’ motions to dis- miss, GHAE twice amended its complaint to drop its claims against ERCOT itself and focus on Fohn in his official capacity; to drop the Dormant Com- merce Clause claim; to revise the Equal Protection claim and focus only on national origin; and to drop a request for damages. The district court granted Fohn’s motion to dismiss and, in relevant part, ruled that LSIPA is not preempted by the CFIUS regime or the dormant foreign affairs preemption doctrine (which latter point GHAE does not appeal). The district court also dismissed the remaining Equal Protection claim (which decision GHAE also does not appeal). GHAE timely appeals _____________________ 7 Tex. Util. Code, § 39.360(b); see generally Tex. Att’y Gen. Op. KP-0388 (2021) (“[B]y granting the generation owner the ability to connect the generator to the transmission system, a generation interconnection agreement gives that company direct or remote access to critical infrastructure … .”). 6  Case: 25-50879 Document: 89-1 Page: 7 Date Filed: 10/16/2026 No. 25-50879 the dismissal of the preemption claim, as to which the district court found “that GHAE’s conflict and field preemption claims fail on the merits.” 8 The district court began with Congress’s purpose embodied in the relevant text and regulatory structure: “‘First, the purpose of Congress is the ultimate touchstone in every pre-emption case,’ and that intent ‘primar- ily is discerned from the language of the pre-emption statute and the statutory framework surrounding it.’”9 The court then introduced the presumption that states’ police power will not be overridden absent “‘the clear and mani- fest purpose of Congress,’” especially in fields of legislation “‘which the States have traditionally occupied.’”10 The district court noted that “[b]oth the U.S. Supreme Court and Fifth Circuit have long recognized the States’ ability to regulate utilities as ‘one of the most important of the functions tra- ditionally associated with the police power of the States.’” 11 And it rejected the idea that LSIPA was oriented to foreign policy, describing it as a measure “only to secure the electric grid.”12 The district court proceeded to analyze conflict preemption, stating that it “exists where state law ‘stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.’” 13 It then _____________________ 8 GH Am. Energy, 815 F. Supp. 3d at 549. 9 Id. (quoting Marrache v. Bacardi U.S.A., Inc., 17 F.4th 1084, 1094 (11th Cir. 2021) (quoting Wyeth v. Levine, 555 U.S. 555, 565 (2009) (further citation omitted))). 10 Id. (quoting Marrache, 17 F.4th at 1095; then quoting Medtronic, Inc. v. Lohr, 518 U.S. 470, 485 (1996) (further citation omitted)). 11 Id. at 549–50 (quoting New Orleans Pub. Serv., Inc. v. Council of City of New Orleans, 491 U.S. 350, 365 (1989) (“NOPSI”), and ERCOT v. Just Energy Tex., L.P. (In re Just Energy Grp., Inc.), 57 F.4th 241, 252 (5th Cir. 2023)). 12 Id. at 552 (distinguishing Crosby v. Nat’l Foreign Trade Council, 530 U.S. 363 (2000)). 13 Id. at 550 (quoting English v. Gen. Elec. Co., 496 U.S. 72, 79 (1990)). 7  Case: 25-50879 Document: 89-1 Page: 8 Date Filed: 10/16/2026 No. 25-50879 rejected GHAE’s argument that LSIPA stands as an obstacle to federal laws governing the field of “foreign investments in the United States.” Id. The district court reasoned that LSIPA did not impair CFIUS’s goals—first, because CFIUS applies only to a limited set of transactions such that LSIPA was generally outside its scope, 14 second, because Texas has a strong state interest in protecting ERCOT,15 and third, that access to that grid is an intrastate activity particularly germane to state regulation. The court added that LSIPA does not conflict with CFIUS’s safe harbor regulatory provision, which provides that a “transaction can proceed without the possi- bility of subsequent suspension or prohibition under section 721” 16 because that regulation insulates a transaction only from further CFIUS review and is silent with respect to all other laws, thereby not excluding those other laws. In sum, the district court held that GHAE failed to meet the “high thresh- old” for showing conflict preemption by obstacles-to-purpose. 17 The district court then proceeded to field preemption, faithfully restating this court’s reasoning that “field preemption exists only where a federal statutory scheme is ‘so pervasive as to make reasonable the inference _____________________ 14 Indeed, the district court questioned at some length whether CFIUS supplies any jurisdiction over a new power plant company, because it does not involve any transaction acquiring an already-existing U.S. business. See 50 U.S.C. § 4565(a)(4)(B). 15 GH Am. Energy, 815 F. Supp. 3d at 551 (quoting Am. Ins. Ass’n v. Garamendi, 539 U.S. 396, 420 (2003) (“It would be reasonable to consider the strength of the state interest, judged by standards of traditional practice, when deciding how serious a conflict must be shown before declaring the state law preempted.”)). 16 73 Fed. Reg. 74569 (Dec. 8, 2008). 17 GH Am. Energy, 815 F. Supp. 3d at 554 (quoting Chamber of Com. of the U.S. v. Whiting, 563 U.S. 582, 607 (2011) (“Our precedents ‘establish that a high threshold must be met if a state law is to be preempted for conflicting with the purposes of a federal Act.’” (quoting Gade v. Nat’l Solid Wastes Mgmt. Ass’n, 505 U.S. 88, 110 (1992) (Kennedy, J., concurring in part and concurring in the judgment)))). 8  Case: 25-50879 Document: 89-1 Page: 9 Date Filed: 10/16/2026 No. 25-50879 that Congress left no room for the States to supplement it,’ or that it ‘touches a field in which the federal interest is so dominant that the federal system will be assumed to preclude enforcement of state laws on the same subject.’” 18 The district court added that field preemption is strongly disfavored, such that federal courts will hesitate to find it unless plaintiffs show that a “‘com- plete ouster of state power including state power to promulgate laws not in conflict with federal laws was the clear and manifest purpose of Congress.’” 19 Applying those principles, the district court found that the CFIUS statutes did not evince a Congressional intent to create an all-pervasive regu- latory regime effecting a complete ouster of related state power, but, instead, merely authorized national security review of certain cases on a narrow timeline. II. A. The Supremacy Clause declares that “[t]his Constitution, and the Laws of the United States which shall be made in Pursuance thereof . . . shall be the supreme Law of the Land . . . any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.” U.S. Const. art. VI, cl. 2. By it, Congress possesses “the power to preempt state law,”20 either “through express language in a statute” or implicitly. 21 “But the exercise of _____________________ 18 Id. at 554 (quoting Nat’l Press Photographers Ass’n v. McCraw, 90 F.4th 770, 796 (5th Cir. 2024) (quoting English, 496 U.S. at 79)). 19 Id. (quoting Nat’l Press Photographers, 90 F.4th at 795–96 (further citation omitted)). 20 Crosby v. Nat’l Foreign Trade Council, 530 U.S. 363, 372 (2000); see Gibbons v. Ogden, 22 U.S. (9 Wheat.) 1, 211 (1824). 21 Oneok, Inc. v. Learjet, Inc., 575 U.S. 373, 376 (2015). 9 Case: 25-50879 Document: 89-1 Page: 10 Date Filed: 10/16/2026 No. 25-50879 that power is not lightly presumed.”22 In light of the dual sovereignties between the federal government and the states, “barring any contradiction, the States retain their sovereign pre- rogatives to regulate.”23 The Supreme Court has disclaimed any “brooding federal interest” or “judicial policy preference” that might generically “win preemption of a state law.”24 “Preemption analysis begins with the assump- tion that the historic police powers of the States are not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress.”25 So where appraising preemption, we start with the opposite presumption—the “presumption against preemption”—which is height- ened in “areas of law traditionally reserved to the states.” 26 And that height- ened presumption against preemption applies in substantive “areas of tradi- _____________________ 22 AbbVie, Inc. v. Murrill, 180 F.4th 747, 758 (5th Cir. 2026). 23 Zyla Life Scis., L.L.C. v. Wells Pharma of Hous., L.L.C., 134 F.4th 326, 328 (5th Cir. 2025); accord Wyeth v. Levine, 555 U.S. 555, 584 (2009) (Thomas, J., concurring in the judgment) (explaining that under our federalist system, “States retain substantial sovereign authority”) (citing the Tenth Amendment (“The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”)); Parker v. Brown, 317 U.S. 341, 359–60 (1943) (the “governments of the states are sovereign within their territory,” and nothing in the Constitution “wholly withdraw[s] from the states the authority to regulate . . . matters of local concern, on which Congress has not spoken”). 24 Va. Uranium, Inc. v. Warren, 587 U.S. 761, 767 (2019) (lead opinion of Gor- such, J.). 25 Deanda v. Becerra, 96 F.4th 750, 761 (5th Cir. 2024) (cleaned up); accord Va. Uranium, 587 U.S. at 779 (even if “Congress might have chosen to regulate the more novel aspects of” a specific area, the states still retain “their traditional function of regulating” whatever falls within their historic police powers). 26 Franks Inv. Co. v. Union Pac. R.R., 593 F.3d 404, 407 (5th Cir. 2010) (en banc) (cleaned up). 10 Case: 25-50879 Document: 89-1 Page: 11 Date Filed: 10/16/2026 No. 25-50879 tional state regulation,”27 as well as critical areas of state prerogative such as control of essential intrastate utilities.28 Indeed, “utility regulation is one of the most important of the functions traditionally associated with the police power of the States.”29 A plaintiff seeking to show federal preemption in those areas “must clear a high threshold.” 30 To appraise preemption, we start, as always, with the text of the rele- vant statutes.31 This court recently restated the framework for textualist pre- emption analysis: The Supreme Court has established “a preemption taxon- omy,” first dividing “between express and implied preemption.” 32 Implied preemption is further divided into two types: field preemption and conflict preemption.33 _____________________ 27 Egelhoff v. Egelhoff ex rel. Breiner, 532 U.S. 141, 151 (2001); accord Hillman v. Maretta, 569 U.S. 483, 490–91 (2013) (listing state laws governing domestic relations, and family and family-property law, as readily-apparent examples); NOPSI, 491 U.S. at 365 (“regulat[ing] utilities” is “one of the most important of the functions traditionally associ- ated with the police power of the States”). 28 See Texas v. EPA, 829 F.3d 405, 431 (5th Cir. 2016) (“In its electrical grid, as in so many things, Texas stands alone.”); see also Zyla, 134 F.4th at 334 (“The Federal Gov- ernment has limited resources,” so “it often welcomes state aid in enforcing shared legal norms.”); see generally California v. Zook, 336 U.S. 725, 738 (1949) (just as “the nation may [regulate] for the safety and welfare of interstate commerce,” “the State may [regulate] as it has in the present case for the safety and welfare of its inhabitants”). 29 ERCOT, 57 F.4th at 251 (cleaned up). 30 Deanda, 96 F.4th at 761. 31 See id. at 761–62 (“The Secretary properly begins with [the] text.”). 32 Zyla, 134 F.4th at 328 (5th Cir. 2025) (quoting Kansas, 589 U.S. at 202–03); see also La Union del Pueblo Entero v. Abbott, 151 F.4th 273, 290 (5th Cir. 2025) (recognizing three species of preemption—express, field, and conflict). 33 Zyla, 134 F.4th at 328. 11 Case: 25-50879 Document: 89-1 Page: 12 Date Filed: 10/16/2026 No. 25-50879 B. Conflict preemption again divides into impossibility preemption and obstacles-and-purposes preemption (of which only the latter is relevant here). Zyla, 134 F.4th at 328–29. Obstacles-and-purposes preemption arises “when state law ‘stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.’” Id. at 329 (quoting Hines v. Davidowitz, 312 U.S. 52, 67 (1941)). “In all these types of preemption, however, evidence of pre-emptive purpose must be sought in the text and structure of the federal provision at issue.” Id. (quoting CSX Transp., Inc. v. Easterwood, 507 U.S. 658, 664 (1993)) (cleaned up). The text of the DPA provides the jurisdiction of the CFIUS regime over “covered transactions.” 50 U.S.C. § 4565(a)(4); see id. at (b)(1)(A). As relevant here, covered transactions include: (i) Any merger, acquisition, or takeover . . . by or with any foreign person that could result in foreign control of any United States business, including such a merger, acquisition, or take- over carried out through a joint venture. (ii) . . . [T]he purchase or lease by, or a concession to, a for- eign person of private or public real estate that is located in the United States . . . in close proximity to a United States military installation or another facility or property of the United States Government that is sensitive for reasons relating to national security … . (iii) Any other investment, subject to [certain regulations defining foreign persons as well as defining access to material nonpublic information of critical infrastructure] by a foreign person in any unaffiliated United States business that owns, operates, manufactures, supplies, or services critical infra- structure; produces, designs, tests, manufactures, fabricates, or develops one or more critical technologies; or maintains or collects sensitive personal data … . 12 Case: 25-50879 Document: 89-1 Page: 13 Date Filed: 10/16/2026 No. 25-50879 (iv) Any change in the rights that a foreign person has with respect to a United States business in which the foreign person has an investment, if that change could result in foreign control of the United States business … . (v) Any other transaction, transfer, agreement, or arrange- ment, the structure of which is designed or intended to evade or circumvent the application of this section … . 50 U.S.C. § 4565(a)(4)(B)(i)–(v). 34 Notably not among those transactions are self-investment in a busi- ness’s own assets; generic purchases of land; or transactions merely amount- ing to contract formation with distributors or suppliers of one’s product. Instead, the provisions above divide into two logical categories: land pur- chases near important U.S. federal property (prong (ii)) and corporate- control transactions (prongs (i) and (iv)), including the kinds of minority- or low-stake investments that would give access to Material Nonpublic Informa- tion (prong (iii)). Finally, like any good statutory list, § 4565(a)(4)(B) in- cludes a catchall that maps back onto the substantive categories it bookends. 35 Below we revisit that statutory text and compare it with the relevant provisions of LSIPA. C. Field preemption turns on whether Congress has occupied a domain of regulation such that states may not impose their own parallel regime within that domain. Arizona v. United States, 567 U.S. 387, 399 (2012); Hines, 312 U.S. at 66–67. Field preemption applies only where Congress has “occu- _____________________ 34 The DPA defines “United States business” as any person engaged in interstate commerce. 50 U.S.C. § 4565(a)(13). 35 See, e.g., Antonin Scalia & Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 199–200 (2012) (on the ejusdem generis canon). 13 Case: 25-50879 Document: 89-1 Page: 14 Date Filed: 10/16/2026 No. 25-50879 pie[d] an entire field,” reflecting “a congressional decision to foreclose any state regulation in the area.”36 “Field preemption of state law is disfavored,” Nat’l Press Photogra- phers, 90 F.4th at 796, which is why it is so “rare” to find in practice, Kansas v. Garcia, 589 U.S. 191, 208 (2020). No less than “an unambiguous congres- sional mandate” suffices to field preempt state law,37 which is why courts should “hesitate” before inferring field preemption. 38 “Only a demonstra- tion that complete ouster of state power . . . was the clear and manifest purpose of Congress” justifies a finding of field preemption. 39 That complete ouster can be identified only where a federal statutory scheme is “so pervasive as to make reasonable the inference that Congress left no room for the States to supplement it” or where it invades “a field in which the federal interest is so dominant that the federal system will be assumed to preclude enforcement of state laws on the same subject.” Nat’l Press Photographers, 90 F.4th at 796 (citation omitted). GHAE takes issue only as to implied preemption, which bifurcates into _____________________ 36 Arizona, 567 U.S. at 401; accord Crystal Clear Special Util. Dist. v. Jackson, 142 F.4th 351, 364 (5th Cir. 2025). 37 Fla. Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132, 147 (1963). 38 City of El Cenizo v. Texas, 890 F.3d 164, 176 (5th Cir. 2018). 39 De Canas v. Bica, 424 U.S. 351, 357 (1976) (emphasis added) (cleaned up); see also William Baude et al., Hart & Wechsler’s The Federal Courts & the Federal System 833 (8th ed. 2025) (observing that “the Court’s standards for field preemption have become stricter in recent years”). 14 Case: 25-50879 Document: 89-1 Page: 15 Date Filed: 10/16/2026 No. 25-50879 conflict and field preemption.40 GHAE lodges alternative theories on both.41 III. A. GHAE principally contends that LSIPA is conflict preempted where “Congress chose a centralized, Executive-led framework for national- security screening of foreign investment that relies on individualized review, tailored mitigation, and ongoing monitoring.” Throughout its briefing, GHAE submits that the district court engaged in “a series of framing errors.” As GHAE would have it, this case is not about state control of utilities, but instead concerns “whether Texas may impose a categorical foreign- ownership ban that functions as a parallel foreign-investment gatekeeping regime in a domain Congress assigned to the federal government.” GHAE first frames the question at a high level of generality: “whether state law ‘stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.’” 42 GHAE theorizes that Congress chose a centralized, Executive-led CFIUS regime in the DPA and FIRRMA, and that the “calibration” of that regime supports Congress’s and the Execu- _____________________ 40 Field preemption and conflict preemption “are not rigidly distinct.” Crosby, 530 U.S. at 372 n.6 (quoting English, 496 U.S. at 79 n.5). We acknowledge the overlap, but the principled logical distinction between conflict preemption and field preemption is that, though conflict preemption always needs to be negatively inferenced with a federal law impairing the purposes of Congress, field preemption is logically broader, such that Con- gress can prospectively occupy a field and prevent any novel conflicts from arising through related law and can deny states the possibility of enacting overlapping compatible regimes through an interest in uniformity and efficient allocation of resources. 41 Because we affirm, we need not reach Fohn’s additional arguments. 42 Quoting English, 496 U.S. at 79 (citing Hines v. Davidowitz, 312 U.S. 52, 67 (1941)). 15 Case: 25-50879 Document: 89-1 Page: 16 Date Filed: 10/16/2026 No. 25-50879 tive’s “flexibility to balance security, economic, and diplomatic interests.” 43 GHAE posits that LSIPA conflicts with that “flexible” federal “calibration” by substituting a “categorical, nationality-based disqualification” and mud- dying Congress’s planned approach of conditional clearance and threat- mitigation deals. GHAE continues to theorize that CFIUS embodies “Congress’s broader policy judgment that foreign investment yields substantial economic benefits and that the United States should maintain an open investment policy . . . .” GHAE complains that “LSIPA forecloses outcomes” foreseen by CFIUS, while couching Congress’s purpose and the types of transactions it controls through CFIUS as “any transaction that presents national security risks.” GHAE then proposes an even broader field of “any foreign invest- ment” that Congress purportedly seeks to control and which would preempt any contrary state law. Fohn counters that the “CFIUS regime is narrow and largely volun- tary.” He asserts that “GHAE describes that regime only vaguely” and “[b]ecause the statutory text is key to assessing GHAE’s preemption claims,” he undertakes to describe CFIUS and LSIPA in some detail. As Fohn explains, Under § 721 of the Defense Production Act of 1950, the Pres- ident has authority to ‘investigat[e] and determine the effects on national security of mergers, acquisitions, and takeovers . . . by or with foreign persons which could result in foreign control of persons engaged in interstate commerce in the United States’ . . . . CFIUS was initially created as a non-statutory interagency committee in 1975 to administer § 721 [and] . . . [b]efore 2018, CFIUS had jurisdiction only over a ‘merger, _____________________ 43 Citing Crosby, 530 U.S. at 373–74. 16 Case: 25-50879 Document: 89-1 Page: 17 Date Filed: 10/16/2026 No. 25-50879 acquisition, or takeover . . . by or with any foreign person which could result in foreign control of any person engaged in inter- state commerce in the United States.’[44] Fohn adds that FIRRMA expanded CFIUS’s jurisdiction beyond M&A, to review a slightly wider set of “covered transactions,” discussed supra. But he highlights that, under CFIUS’s specific grants of jurisdiction, no “covered transaction” is in play here, including as to the creation of a new business (he also points out that it is possible to comply with both laws). 45 Fohn reasons that CFIUS’s jurisdiction is mainly voluntary and expressly foresees the President’s “suspending and prohibiting any covered transac- tion” provided that “other provisions of law do not ‘provide adequate and appropriate authority for the President to protect the national security.’” 46 Fohn also reminds that “preemption must be found in the statutory text, not a party’s or court’s subjective beliefs about what Congress in- tended.”47 And Fohn asserts that “GHAE never acknowledges this frame- _____________________ 44 Citing Defense Production Act of 1950, Pub. L. 100-418, 102 Stat. 1107, § 5102; Exec. Order No. 11858, 3. C.F.R. 990 (1971–1975); 50 U.S.C. § 4565(a)(3) (amended 2018). 45 Citing 31 C.F.R. § 800.301(e)(7) (providing that if a foreign person “incorpor- at[es] a newly formed subsidiary” and “construct[s] . . . a plant to make a new product,” it “will not have acquired a U.S. business, and its greenfield investment is not a covered con- trol transaction”). 46 Quoting 50 U.S.C. § 4565(d)(4). Texas Attorney General Paxton’s brief also argues against field preemption where the federal regulations “‘appear to contemplate some concurrent state regulation’” (quoting Nat’l Press Photographers, 90 F.4th at 796 (quoting R.J. Reynolds Tobacco Co. v. Durham Cnty., 479 U.S. 130, 149 (1986) (further citation omitted))). 47 Citing La Union, 151 F.4th at 291; id. at 295 (“If Congress’s ‘purposes and objec- tives’ are to displace state law, those purposes and objectives must be gleaned from the text of a federal law enacted through the procedures demanded by the Constitution.”); Va. Uranium, 587 U.S. at 777 (obstacle preemption cannot “elevate abstract and unenacted legislative desires above state law”). See also Kansas, 589 U.S. at 214 (Thomas, J., con- curring, joined by Gorsuch, J.) (suggesting that the “‘purposes and objectives’ pre- emption doctrine” is “contrary to the Supremacy Clause” because it “impermissibly rests 17 Case: 25-50879 Document: 89-1 Page: 18 Date Filed: 10/16/2026 No. 25-50879 work” and “makes no effort to identify a preemptive purpose in § 721’s text” apart from describing CFIUS as a “calibrated” framework. Thus, Fohn posits that CFIUS is orthogonal to LSIPA and implies that CFIUS exhibits a purpose to play nicely in the sandbox with other law.48 In response, GHAE criticizes the district court for inflating the “tradi- tional police powers” interest and imposing some “heightened obstacle- preemption threshold.” GHAE asserts that the “relevant question remains the ordinary one: whether LSIPA stands as an obstacle to Congress’s pur- poses and objectives embodied in Section 721… .” Here, Fohn counters that Texas’s control of ERCOT is at the heart of its historic police powers 49 and that there is not “clear conflict” with any “express federal policy” as in Gar- amendi, 593 U.S. at 425. GHAE also quibbles with the district court’s handling, supra, of the CFIUS safe harbor provision. Attorney General Paxton’s brief responds to that point by noting that the safe harbor provision only insulates a proposed control- or real estate-transaction from further CFIUS review, while remain- ing silent as to any other body of law.50 _____________________ on judicial guesswork about broad federal policy objectives, legislative history, or gen- eralized notions of congressional purposes that are not contained within the text of federal law” (cleaned up)). 48 Citing 50 U.S.C. § 4565(i) (“No provision of this section shall be construed as altering or affecting any other authority, process, regulation, investigation, enforcement measure, or review provided by or established under any other provision of Federal law … .”). 49 See, e.g., NextEra Energy Cap. Holdings, In