Younger Abstention Applies to Pennsylvania Usury Enforcement OSCs; Appellate Courts May Affirm Despite Omitted Sprint Threshold Finding When Record Satisfies It

1. Introduction

In TMX Finance Corporate Services, Incorporated v. Spicher (5th Cir. Jan. 9, 2026) (per curiam, unpublished), the United States Court of Appeals for the Fifth Circuit affirmed the Northern District of Texas’s dismissal of a federal suit on Younger abstention grounds. The dispute arose from a long-running investigation by the Pennsylvania Department of Banking and Securities into TitleMax-affiliated entities. After subpoenas and years of discovery, the Department issued an order to show cause (OSC) seeking over $52 million in monetary sanctions for alleged violations of Pennsylvania usury laws.

Shortly after the OSC issued, TMX Finance Corporate Services (“TMX FCS”) and affiliates filed multiple federal suits nationwide seeking equitable relief against the Pennsylvania enforcement proceeding (as noted in TitleMax of S.C., Inc. v. Spicher). In the Texas action, TMX FCS asserted that the OSC was unconstitutional as applied to it because, as a distinct corporate entity, it claimed it never engaged in lending activity and the Department failed to allege wrongdoing by TMX FCS itself.

The central appellate questions were whether the Pennsylvania proceeding fit within the limited categories of state proceedings that justify Younger abstention under Sprint Commc'ns, Inc. v. Jacobs, and—if so—whether the traditional Younger elements (interference, important state interest, and adequate opportunity to raise constitutional claims) were satisfied.

2. Summary of the Opinion

The Fifth Circuit affirmed the dismissal. It held that:

Even though the district court did not explicitly make the Sprint “threshold determination,” the Fifth Circuit could affirm because it reviews judgments, not opinions and the record showed the OSC was a qualifying civil enforcement proceeding.
The Pennsylvania enforcement matter was “ongoing” for Younger purposes notwithstanding TMX FCS’s service/process objections, particularly given the state tribunal’s substantial progress compared to the federal case.
The requested equitable relief was not “wholly prospective” under Ballard v. Wilson, because adjudicating the federal claims would necessarily occur “against the backdrop” of the pending state enforcement and overlapped with core issues in that proceeding.
Pennsylvania had an important interest in enforcing usury laws that carry criminal and civil penalties; that interest is assessed at the level of the “generic proceedings,” not the plaintiff’s defenses (per New Orleans Pub. Serv., Inc. v. Council of New Orleans (NOPSI)).
TMX FCS had an adequate opportunity to raise constitutional objections because it did so in the administrative forum and, in any event, could raise such claims on state-court review (per Ohio C.R. Comm'n v. Dayton Christian Schs. and Pennsylvania’s judicial review statute).

3. Analysis

3.1 Precedents Cited

Sprint Commc'ns, Inc. v. Jacobs and New Orleans Pub. Serv., Inc. v. Council of New Orleans (NOPSI)

The opinion treats Sprint as the mandatory gateway to Younger: federal courts must first determine whether the state matter fits one of the recognized categories—“state criminal prosecutions, civil enforcement proceedings, [or] civil proceedings involving certain orders that are uniquely in furtherance of the state courts' ability to perform their judicial functions.” Those categories are rooted in NOPSI.

Although the district court did not expressly conduct that threshold categorization, the Fifth Circuit concluded the error was not reversible because the OSC “fits comfortably” within the civil enforcement proceeding category described in Sprint, particularly given the investigative history, the coercive posture, and the sanctions sought under Pennsylvania law.

Escalante v. Lidge

Escalante v. Lidge supplies the appellate principle that “we review judgments, not opinions.” The Fifth Circuit used it to sidestep the absence of an explicit district-court Sprint finding and to affirm based on the pleadings and record showing the proceeding is the kind to which Younger can apply.

Daves v. Dallas County (en banc)

Once the case passed the Sprint gateway, the court turned to the Fifth Circuit’s en banc articulation of the three Younger factors in Daves v. Dallas County: (1) interference with an ongoing state judicial proceeding; (2) important state interest; and (3) adequate opportunity in state proceedings to raise constitutional challenges.

Hicks v. Miranda and Middlesex Cnty. Ethics Comm. v. Garden State Bar Ass'n

TMX FCS argued the Pennsylvania proceeding was not “ongoing” because of allegedly improper service/process. The Fifth Circuit invoked Hicks v. Miranda for the proposition that abstention is appropriate even where the state proceeding begins after the federal complaint, so long as no federal “proceedings of substance on the merits” have occurred. It then referenced Middlesex Cnty. Ethics Comm. v. Garden State Bar Ass'n, which quotes and reinforces Hicks in the administrative-enforcement context.

The practical comparison mattered: the state proceeding had progressed substantially, while the federal case had been “wholly occupied” by abstention issues—supporting the “ongoing proceeding” requirement regardless of TMX FCS’s service challenge.

Ballard v. Wilson

TMX FCS attempted to avoid Younger by framing its requested injunction as “wholly prospective” (targeting the 2024 subpoena and “further extraterritorial regulation”). Under Ballard v. Wilson, purely prospective relief that does not interfere with an ongoing state proceeding may fall outside Younger’s core comity concerns.

The Fifth Circuit rejected the characterization because the federal claims overlapped with and would be adjudicated “against the backdrop” of the pending enforcement action—especially issues of corporate separateness, personal jurisdiction, and whether TMX FCS engaged in lending. This treatment narrows the practical reach of “prospective” relief where the requested declaration/injunction would functionally undermine the pending state enforcement.

Gates v. Strain and NOPSI (important state interest)

For the “important interest” prong, the Fifth Circuit relied on NOPSI’s instruction not to “look narrowly” at the state’s interest in the outcome of a particular dispute but at “the importance of the generic proceedings to the State.” It further cited Gates v. Strain for the proposition that states have a substantial interest in enforcing their criminal laws and analogs. Because Pennsylvania’s usury provisions authorize both criminal and civil penalties (citing 41 Pa. Cons. Stat. § 505 and 7 Pa. Cons. Stat. § 6218), the enforcement action qualified as an important state interest in a quasi-criminal regulatory domain.

Harper v. Pub. Serv. Comm'n, National Pork Producers Council v. Ross, and Pike v. Bruce Church, Inc. (Dormant Commerce Clause)

TMX FCS argued that a federal interest in enforcing the Dormant Commerce Clause outweighed Pennsylvania’s interest. The Fifth Circuit cited Harper v. Pub. Serv. Comm'n for general Dormant Commerce Clause purposes, but held that TMX FCS failed to identify a concrete federal interest that could override abstention—particularly where the argument was largely a repackaging of merits defenses (no lending conduct; no personal jurisdiction).

Because TMX FCS did not claim the Pennsylvania regime was facially discriminatory, the court indicated that Pike v. Bruce Church, Inc. balancing would apply. Referencing National Pork Producers Council v. Ross, the court emphasized that Pike balancing requires more than what TMX FCS offered—suggesting that generalized assertions of extraterritorial impact or burden are insufficient to defeat abstention.

Ohio C.R. Comm'n v. Dayton Christian Schs. and 2 Pa. Cons. Stat. § 702 (adequate opportunity)

On the “adequate opportunity” prong, the Fifth Circuit relied on Ohio C.R. Comm'n v. Dayton Christian Schs. for the rule that it is enough that constitutional claims can be raised on state-court judicial review of the administrative proceeding. It also cited 2 Pa. Cons. Stat. § 702 as the vehicle for that judicial review in Pennsylvania.

The court found TMX FCS’s argument factually undercut because TMX FCS had already presented constitutional objections in a motion to dismiss before the administrative tribunal, and that motion was denied on the merits.

3.2 Legal Reasoning

A. The Sprint “threshold determination” can be satisfied on appeal even if the district court did not expressly make it

A significant procedural feature of the decision is its refusal to treat the lack of an explicit Sprint categorization as automatically reversible. By invoking Escalante v. Lidge, the Fifth Circuit effectively held that an appellate court may affirm a Younger dismissal if the record supports the conclusion that the state matter falls into a recognized Sprint category—here, a coercive administrative enforcement action seeking substantial sanctions for alleged usury violations.

Practically, this reduces the benefit of appellate challenges focused solely on the district court’s failure to “say the words” of the Sprint gateway, so long as the appellate court can confidently classify the proceeding.

B. “Ongoing” is assessed pragmatically, not formalistically

TMX FCS’s service-of-process argument illustrates the opinion’s pragmatic approach. Even assuming disputes about proper service under state law, the Fifth Circuit considered the real-world procedural posture: the Pennsylvania administrative case had ongoing motion practice and meaningful adjudicative investment, while the federal suit had not progressed beyond abstention. Under Hicks v. Miranda and Middlesex, the timing and substance of proceedings mattered more than technical defects asserted as to initiation.

C. The “prospective relief” concept does not apply where relief would functionally adjudicate or derail the enforcement case

The court treated TMX FCS’s subpoena-focused request for relief as inseparable from the OSC enforcement proceeding, because both required resolving overlapping questions (corporate separateness, personal jurisdiction, and lending activity). The result is a functional test: when the federal suit would effectively decide defenses central to the state enforcement, it “interferes,” and Younger applies notwithstanding attempts to re-label the requested remedy as “prospective.”

D. “Important state interest” is measured by the category of proceeding, not the defendant’s jurisdictional defenses

TMX FCS argued Pennsylvania lacked an interest because it lacked authority over TMX FCS. The Fifth Circuit rejected this as an impermissibly narrow framing under NOPSI. The relevant interest was Pennsylvania’s general interest in enforcing usury laws through civil (and quasi-criminal) enforcement proceedings—bolstered by the existence of criminal and civil penalties under 41 Pa. Cons. Stat. § 505 and 7 Pa. Cons. Stat. § 6218.

This approach channels jurisdictional and merits defenses (personal jurisdiction, corporate separateness, “we didn’t do it”) back into the state forum, rather than letting such defenses defeat abstention at the threshold.

E. Constitutional claims need only be meaningfully available, not immediately dispositive

TMX FCS asserted it could not obtain a pre-merits ruling on constitutional objections in the administrative process. The Fifth Circuit responded in two steps: (1) TMX FCS in fact filed constitutional objections and received a merits denial; and (2) even if the administrative process were limited, it is enough that constitutional issues can be raised on state-court review (Ohio C.R. Comm'n v. Dayton Christian Schs.; 2 Pa. Cons. Stat. § 702).

The decision thus treats “adequate opportunity” as satisfied when there is a channel for later judicial review, even if the litigant prefers a faster or different sequencing of constitutional adjudication.

3.3 Impact

Stronger insulation for state administrative enforcement from parallel federal injunction suits: Regulated entities facing state OSCs or similar enforcement devices—especially those seeking large sanctions—should expect Younger to bar federal equitable interference when the enforcement is coercive and ongoing.
Narrower practical space for “prospective relief” framing: Litigants often attempt to isolate investigative subpoenas or “future regulation” as distinct from enforcement; this opinion signals that overlap in legal/factual issues with the enforcement action will likely trigger abstention.
Jurisdictional and corporate-separateness defenses are not abstention “escape hatches”: The court’s analysis suggests that arguments like “no personal jurisdiction” and “we are a separate entity” generally belong in the state proceeding and do not negate the state’s “important interest” for Younger.
Dormant Commerce Clause challenges may not defeat Younger without developed Pike evidence: By citing National Pork Producers Council v. Ross and pointing to Pike v. Bruce Church, Inc., the court indicated that conclusory burden assertions are insufficient. Future plaintiffs may attempt more robust Pike showings, but this opinion suggests that, absent facial discrimination, a thin Pike presentation will not overcome abstention in an ongoing state enforcement posture.
Appellate affirmance despite omitted Sprint step: The decision may encourage appellees to defend Younger dismissals even where district courts failed to articulate the Sprint categorization, arguing the record satisfies it—reducing remands for “missing step” errors.

Note: the panel designated the opinion as not for publication (5th Cir. R. 47.5). While nonprecedential, it is still informative of how the Fifth Circuit is applying Sprint and the Younger factors to modern state administrative enforcement actions involving significant monetary exposure.

4. Complex Concepts Simplified

Younger abstention: A doctrine requiring federal courts, in limited circumstances, to refrain from interfering with certain ongoing state proceedings, out of respect for state sovereignty and the state’s ability to enforce its laws.
Sprint “categories” (the gateway step): Before applying Younger’s usual factors, a federal court must confirm the state case is of a type that qualifies: criminal prosecutions, certain civil enforcement actions (often “quasi-criminal”), or proceedings involving state-court functions.
Civil enforcement / “quasi-criminal” proceeding: A state-initiated action investigating and prosecuting alleged violations of law, often following an investigation and seeking penalties—similar in character to criminal enforcement even if formally civil.
“Ongoing” proceeding: A state case can be “ongoing” for Younger even if the federal suit was filed first, so long as the federal case has not substantively progressed and the state matter is actively proceeding.
Prospective relief exception (as discussed via Ballard): Some suits seeking only forward-looking relief may avoid Younger, but only when the relief would not practically interfere with the pending state action.
Dormant Commerce Clause & Pike balancing: If a state law is not facially discriminatory against interstate commerce, courts often weigh the local benefits against the burden on interstate commerce. The Fifth Circuit signaled that such balancing requires developed, specific support—not conclusory assertions.
Adequate opportunity to raise constitutional claims: A plaintiff need not show the state tribunal will rule immediately on constitutional issues; it is generally enough that constitutional claims can be raised at some point in the state system, including on judicial review of an agency decision.

5. Conclusion

TMX Finance v. Spicher reinforces a robust application of Younger abstention to coercive state administrative enforcement actions, including those seeking large monetary sanctions for alleged usury violations. The Fifth Circuit treated the Pennsylvania OSC as a paradigmatic civil enforcement proceeding under Sprint, held that “ongoing” status turns on practical procedural realities rather than service-based technicalities, narrowed the utility of “prospective relief” framing where issues overlap with the enforcement case, and confirmed that constitutional objections are “adequately” available when they can be raised in the administrative forum or on state-court review.

The broader significance is doctrinal and strategic: federal courts in the Fifth Circuit are likely to view parallel federal injunction actions against ongoing state enforcement as improper interference—leaving regulated entities to press jurisdictional, corporate-structure, and constitutional defenses within the state enforcement process and subsequent state judicial review.