Fifth Circuit hears appeal on Texas ban on Chinese property
Appeals court weighs if Chinese nationals owning Texas property can sue over state's foreign ownership ban.
The Texas State Capitol in Austin (AP Photo/Eric Gay, File)
A panel of the U.S. Court of Appeals for the Fifth Circuit heard arguments on Monday, Nov. 2, 2026, regarding a legal challenge to Texas Senate Bill 17. The law, which took effect on Sept. 1, 2025, prohibits individuals and entities from China, Russia, Iran and North Korea from purchasing most real property in the state.
The plaintiffs, Min Huang and Qiong Dai, are Chinese nationals who currently own rental properties in the Houston area. They argue that the legislation unconstitutionally prevents them from acquiring additional real estate in Texas. Their attorney, Justin Sadowsky, asserted that his clients possess constitutional rights because they own property within the United States and are subject to the decisions of American courts.
The state of Texas maintains that the plaintiffs' claims should be dismissed. Lawyers for the state have argued that the plaintiffs' plans to purchase more property are too speculative and that foreign citizens residing outside the United States do not hold the same constitutional protections as those within the country.
The case returns to the appellate court following a December 2025 lower court ruling that dismissed the lawsuit. In that decision, the court found that foreign citizens living abroad generally lack constitutional rights. The Fifth Circuit is now reviewing the arguments to determine whether the legal challenge can proceed.