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United States District Court, W.D. Texas,

Division.

TEXAS MUTUAL INSURANCE COMPANY, Plaintiff

v.

KINSALE INSURANCE COMPANY, Defendant

Case No. 1:19-CV-529-LY

|

Signed 11/20/2019

Attorneys & Firms

R. Scott Placek, Arnold & Placek, P.C., Round Rock, TX, for Plaintiff.

Andres Cordova, Pro Hac Vice, Sina Bahadoran, Pro Hac Vice, Clyde & CO US LLP, Miami, FL, Lisa M. Henderson, Clyde & CO US LLP, Dallas, TX, for Defendant.

REPORT AND RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE

SUSAN HIGHTOWER, UNITED STATES MAGISTRATE JUDGE

*1

TO: THE HONORABLE LEE YEAKEL

UNITED STATES DISTRICT JUDGE

Before this Court are Kinsale’s Opposed Motion for Leave to File Amended Answer to Assert Counterclaim, Instanter, filed August 6, 2019 (Dkt. No. 16); Plaintiff’s Opposed Motion to Dismiss, filed August 13, 2019 (Dkt. No. 18); and the Response and Reply Briefs. On September 10, 2019, the District Court referred the above motions to the undersigned Magistrate Judge for Report and Recommendation pursuant to 28 U.S.C. § 636(b)(1), Federal Rule of Civil Procedure 72, and Rule 1 of Appendix C of the Local Rules of the United States District Court for the Western District of Texas.

I. BACKGROUND

Plaintiff Texas Mutual Insurance Company (“Texas Mutual”) issued a Texas workers’ compensation and employers’ liability insurance policy to Quality South Texas Trucking, Inc. (“Quality Trucking”), with a policy period from August 18, 2017 to August 19, 2018 (“Texas Mutual Policy”). Defendant Kinsale Insurance Company (“Kinsale”) issued a commercial general liability insurance policy to Quality Trucking, with a policy period from August 18, 2017 to August 18, 2018 (“Kinsale Policy”). Both Parties contend that they have no duty to defend in an underlying state negligence lawsuit.

A. The Underlying Lawsuit

In October 2017, SM Energy Company and Trinidad Drilling hired Quality Trucking to move a large drilling rig from Catarina, Texas, to a nearby location. Quality Trucking hired Steven Martinez to help move the drilling rig. On November 3, 2017, during the drilling rig move, Mr. Martinez was seriously injured when his right leg was crushed by a crane operated by Fred Gonzalez, the owner of Quality Trucking. Mr. Martinez underwent five major surgeries, and ultimately had to have his right leg amputated.

On January 26, 2018, Mr. Martinez and his wife, Bertha Martinez, individually and as next friends of their children (the “Martinez Plaintiffs”), filed their first negligence lawsuit against Quality Trucking, Trinidad Drilling, SM Energy Company, and Fred Gonzalez. See Martinez v. Trinidad Drilling, No. 18-01-1335-DCVAJA (365th Dist. Ct. Dimmit County, Tex. Jan. 26, 2018).

Once notified of the underlying lawsuit, Texas Mutual informed Quality Trucking that it had no duty to defend Quality Trucking in the lawsuit because the Texas Mutual Policy “covers only bodily injury arising out of and in the course of an injured employee’s employment by the insured.” Dkt. No. 1-1 at ¶ 11. Because Mr. Martinez had not alleged that he was an employee of Quality Trucking, Texas Mutual took the position that there was no coverage under the Policy. When Quality Trucking informed Texas Mutual that Kinsale had also denied coverage under the Kinsale Policy, however, Texas Mutual agreed to defend Quality Trucking and Mr. Gonzalez in the lawsuit “with gratuitous defenses as business courtesy.” Id. at ¶ 12.

Subsequently, Texas Mutual notified Kinsale that Kinsale had the sole duty to defend Quality Trucking in the lawsuit because the Martinez Plaintiffs sought damages for bodily injuries and Mr. Martinez was not an employee of Quality Trucking. Kinsale denied it had a duty to defend the lawsuit, contending that Texas Mutual was under a duty to defend.

*2 The Martinez Plaintiffs eventually non-suited their first state court action and, on June 14, 2018, re-filed the case in Webb County. See Martinez v. Trinidad Drilling, No. 001195-D3 (341st Dist. Ct. Webb County, Tex. June 14, 2018) (“Underlying Lawsuit”). Mr. Martinez specifically alleged in the Underlying Lawsuit that he was hired as “an independent contract driver,” and that he “was not an employee of [Quality Trucking and Mr. Gonzalez] at the time he sustained his injuries.” Dkt. No. 1-1 at Exh. D, p. 3.

On January 15, 2019, Texas Mutual again contacted Kinsale and requested that Kinsale defend Quality Trucking in the Underlying Lawsuit. Again, Kinsale took the position that it had no duty to defend because Quality Trucking was covered under the Texas Mutual Policy. Id. at Exh. C.

B. The Instant Lawsuit

On April 17, 2019, Texas Mutual filed the instant lawsuit against Kinsale in state court, seeking a declaratory judgment under the Texas Uniform Declaratory Judgment Act that “it has no duty to defend” and that Kinsale does have a duty to defend Quality Trucking in the Underlying Lawsuit. See Texas Mutual Ins. Co. v. Kinsale Ins. Co., No. D-1-GN-19-002114 (126th Dist. Ct. Travis County, Tex. Apr. 17, 2019). Texas Mutual contends that the Kinsale Policy does not exclude independent contractors from coverage, and Kinsale thus has a duty to defend.

On May 16, 2019, Kinsale removed this case to federal court on the basis of diversity jurisdiction under 28 U.S.C. § 1441. See Dkt. No. 1. Shortly after this case was removed to federal court, the Texas Department of Insurance, Division of Workers’ Compensation (“DWC”), issued a decision finding that Mr. Martinez was not an employee of Quality Trucking. Accordingly, Kinsale now has assumed its defense of the Underlying Lawsuit, pursuant to a reservation of rights letter. Accordingly, Texas Mutual has withdrawn its gratuitous defense in the Underlying Lawsuit.

Nevertheless, on August 6, 2019, Kinsale filed its Motion for Leave to file an Amended Answer in order to assert counterclaims against Texas Mutual, pursuant to Federal Rules of Civil Procedure 13 and 15(a)(2). Kinsale claims that it has no duty to defend Quality Trucking because Texas Mutual “voluntarily paid worker’s compensation benefits to Steven Martinez for his employment related injuries,” and thus Texas Mutual’s claims are barred under the doctrines of waiver and estoppel. See Dkt. No. 16 at p. 4. Kinsale also argues that coverage is barred under various exclusions from the Policy, including exclusions and endorsements relating to independent contractors, the duty to defend, employer liability, workers’ compensation, and medical payments. Kinsale seeks to file a counterclaim for declaratory relief under 28 U.S.C. § 2201 against Texas Mutual “to establish that there is no coverage under a commercial general liability and commercial excess liability policies that Kinsale issued to [Quality Trucking] for workplace injuries Steven Martinez allegedly sustained while working as an independent contractor for [Quality Trucking].” Dkt. No. 16 at p. 6.

In response, Texas Mutual argues that “Kinsale’s assumption of the defense, and Texas Mutual’s withdrawal, has mooted the case asserted by Texas Mutual and renders this case non-justiciable.” Dkt. No. 18 at p. 3. Texas Mutual contends that there is no longer a case or controversy regarding its duty to defend because it has already withdrawn from the defense in the Underlying Lawsuit. Accordingly, Texas Mutual moves to dismiss this case without prejudice under Federal Rule of Civil Procedure 41(a)(2).

II. LEGAL STANDARD

*3 A plaintiff may unilaterally dismiss his action without prejudice by filing a notice of dismissal before the opposing party serves either an answer or a motion for summary judgment. FED. R. CIV. P. 41(a)(1)(A)(i). If the defendant has filed a motion for summary judgment or an answer, as in this case, however, Rule 41(a)(2) permits dismissal at the plaintiff’s request “only by court order, on terms that the court considers proper.” Id. at Rule 41(a)(2). “Voluntary dismissal under Rule 41(a)(2) is a matter within the sound discretion of the district court, and the district court’s decision on this issue is reviewed only for abuse of discretion.” Templeton v. Nedlloyd Lines, 901 F.2d 1273, 1274-75 (5th Cir. 1990); see also Welsh v. Correct Care, L.L.C., 915 F.3d 341, 343 (5th Cir. 2019).

The Fifth Circuit has explained that, “as a general rule, motions for voluntary dismissal should be freely granted unless the non-moving party will suffer some plain legal prejudice other than the mere prospect of a second lawsuit.” Elbaor v. Tripath Imaging, Inc., 279 F.3d 314, 317 (5th Cir. 2002). And the mere fact that the plaintiff “may gain a tactical advantage by dismissing its suit without prejudice and refiling in another forum is not sufficient legal prejudice.” Bechuck v. Home Depot U.S.A., Inc., 814 F.3d 287, 299 (5th Cir. 2016) (internal quotation omitted). The “purpose of the grant of discretion under Rule 41(a)(2) ... is primarily to prevent voluntary dismissals which unfairly affect the other side[.]” 9 CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE § 2364 (3d ed. 2018) (internal quotation omitted). Absent such a showing or other “evidence of abuse by the movant,” the motion should be granted. Elbaor, 279 F.3d at 317.

III. ANALYSIS

As noted, Texas Mutual filed this lawsuit in state court seeking a declaratory judgment under the Texas Uniform Declaratory Judgment Act that it has no duty to defend and Kinsale does have a duty to defend in the Underlying Lawsuit. When a Texas Declaratory Judgment Act (“DJA”) suit is removed to federal court, it is treated as though it had been originally filed under the Federal DJA. Edionwe v. Bailey, 860 F.3d 287, 294 n.2 (5th Cir. 2017), cert. denied, 138 S. Ct. 687 (2018); see also Wells Fargo Bank, N.A. v. American Gen. Life Ins. Co., 670 F. Supp. 2d 555, 565 (N.D. Tex. 2009) (“Because the Texas [DJA] is procedural in nature, it does not govern a declaratory-judgment action in federal court.”). Texas Mutual argues that this Court lacks jurisdiction to issue a declaratory judgment in this case because there is no longer a case or controversy between it and Kinsale. The Court agrees.

Federal courts lack subject matter jurisdiction to issue a declaratory judgment unless an “actual controversy” exists between the parties. 28 U.S.C. § 2201(a). “It has been said that the case or controversy requirement of Article III of the United States Constitution is identical to the actual controversy requirement under the Declaratory Judgment Act.” State of Tex. v. West Pub. Co., 882 F.2d 171, 175 (5th Cir. 1989). “In order to demonstrate that a case or controversy exists to meet the Article III standing requirement when a plaintiff is seeking injunctive or declaratory relief, a plaintiff must allege facts from which it appears there is a substantial likelihood that he will suffer injury in the future.” Bauer v. Texas, 341 F.3d 352, 358 (5th Cir. 2003). In other words, “[a] claim for declaratory judgment seeks to define the legal rights and obligations of the parties in anticipation of some future conduct, not to proclaim liability for a past act.” Haggard v. Bank of the Ozarks, Inc., 547 F. App’x 616, 620 (5th Cir. 2013). Accordingly, a request for declaratory relief “can be mooted by subsequent developments.” Id. “An action becomes moot when ‘the issues presented are no longer ‘live’ or the parties lack a legal cognizable interest in the outcome.’ ” Fla. Bd. of Bus. Regulation v. N.L.R.B., 605 F.2d 916, 918 (5th Cir. 1979) (quoting Flast v. Cohen, 392 U.S. 83, 95 (1968)). This is the situation in the case at bar.

*4 Because Kinsale has assumed the defense in the Underlying Lawsuit and Texas Mutual has withdrawn from the case, Texas Mutual’s request for declaratory relief is now moot because it has received all the relief sought in this case. See Haggard, 547 F. App’x at 620 (finding that plaintiff’s claim for declaratory relief had been rendered moot where it obtained the relief it sought). This Court does not have jurisdiction to issue an advisory opinion on a matter that is no longer a live case or controversy between the parties. See St. Pierre v. United States, 319 U.S. 41, 42 (1943) (“A federal court is without power to decide moot questions or to give advisory opinions which cannot affect the rights of the litigants in the case before it.”).

The Court also finds that Kinsale no longer has an adverse legal interest against Texas Mutual in this case. Although Kinsale’s proposed amended answer seeks to assert counterclaims against Texas Mutual, those proposed counterclaims are all directed toward Quality Trucking, not Texas Mutual. For example, Kinsale’s proposed amended answer states: “This is an action for declaratory relief under 28 U.S.C. § 2201 to establish that there is no coverage under a commercial general liability and commercial excess liability policies that Kinsale issued to Quality South Texas Trucking, Inc. [ ] for workplace injuries Steven Martinez allegedly sustained while working as an independent contractor for Quality [Trucking].” Dkt. No. 16 at p. 6. In addition, the proposed amended answer and counterclaims focus solely on the Kinsale Policy, and why Kinsale has no duty to defend under the Kinsale Policy. Thus, Kinsale does not have an actual controversy with Texas Mutual, but rather with Quality Trucking. Kinsale concedes as much in its Response brief when it states: “Kinsale’s counterclaim presents a justiciable controversy regarding coverage for Martinez’s underlying tort lawsuit against Quality [Trucking] ... In particular, Kinsale seeks a declaration that there is no coverage because the Limitation—Independent Contractors endorsement bars coverage for bodily injury to Quality [Trucking]’s independent contractors.” Dkt. No. 22 at p. 3-4 (emphasis added). Accordingly, Kinsale’s dispute is with Quality Trucking, not Texas Mutual.

Kinsale argues in its Response that there is an actual controversy with Texas Mutual “because Texas Mutual may assert a claim against Kinsale for reimbursement of defense costs and medical payments it made prior to withdrawing its defense of Quality [Trucking].” Id. at p. 4 (emphasis added). Texas Mutual, however, has not asserted such claims in this case and, therefore, Kinsale’s argument is merely speculative. “Ripeness separates those matters that are premature because the injury is speculative and may never occur from those that are appropriate for judicial review.” United Transp. Union v. Foster, 205 F.3d 851, 857 (5th Cir. 2000). A declaratory action must be ripe to be justiciable. Shields v. Norton, 289 F.3d 832, 835 (5th Cir. 2002). Because Kinsale relies only on speculative, unripe potential claims in this case, it has failed to show that any justiciable issues remain. Accordingly, this Court lacks subject matter jurisdiction to issue a declaratory judgment.

Because the Court finds that it lacks jurisdiction over this case, Texas Mutual’s Motion to Dismiss should be granted. The Court further finds that dismissal of this case under Rule 41(a)(2) will not unfairly prejudice Kinsale. See Elbaor, 279 F.3d at 317 (stating that “motions for voluntary dismissal should be freely granted unless the non-moving party will suffer some plain legal prejudice other than the mere prospect of a second lawsuit”).

IV. RECOMMENDATION

*5 Based on the foregoing, the undersigned RECOMMENDS that the District Court GRANT Plaintiff’s Opposed Motion to Dismiss (Dkt. No. 18) and DISMISS this lawsuit without prejudice under Federal Rule of Civil Procedure 41(a)(2). The Court FURTHER RECOMMENDS that the District Court DENY Kinsale’s Opposed Motion for Leave to File Amended Answer to Assert Counterclaim (Dkt. No. 16).

IT IS FURTHER ORDERED that this case be removed from the Magistrate Court’s docket and returned to the docket of the Honorable Lee Yeakel.

V. WARNINGS

The parties may file objections to this Report and Recommendation. A party filing objections must specifically identify those findings or recommendations to which objections are being made. The District Court need not consider frivolous, conclusive, or general objections. See Battle v. United States Parole Comm’n, 834 F.2d 419, 421 (5th Cir. 1987). A party’s failure to file written objections to the proposed findings and recommendations contained in this Report within fourteen (14) days after the party is served with a copy of the Report shall bar that party from de novo review by the District Court of the proposed findings and recommendations in the Report and, except on grounds of plain error, shall bar the party from appellate review of unobjected-to proposed factual findings and legal conclusions accepted by the District Court. See 28 U.S.C. § 636(b)(1); Thomas v. Arn, 474 U.S. 140, 150-53 (1985); Douglass v. United Servs. Auto. Ass’n, 79 F.3d 1415, 1428-29 (5th Cir. 1996) (en banc).

United States District Court, W.D. Texas, El Paso Division.

CAMOCO, LLC, Plaintiff,

v.

Carlos LEYVA a/k/a AJ&I Construction Clean Up, Defendant.

EP-18-CV-00279-DCG

|

Signed 11/19/2019

Attorneys & Firms

*605 Andrew J. Mongelluzzi, Clearwater Business Law, LLC, Clearwater, FL, James Allen Martinez, Law Office of James Martinez, El Paso, TX, for Plaintiff.

M. Mitchell Moss, Priscilla M. Castillo, Moss Legal Group, PLLC, El Paso, TX, for Defendant.

MEMORANDUM OPINION AND ORDER

DAVID C. GUADERRAMA, UNITED STATES DISTRICT JUDGE

Presently before the Court is Plaintiff Camoco, LLC’s “Emergency Motion to Extend Discovery Deadline and Compel Deposition of Non-Party Witness” (“Motion”) (ECF No. 79) filed on October 28, 2019. Therein, Plaintiff asks the Court to extend the discovery deadline for 30 days from the date of the Scheduling Order—November 1, 2019, see Scheduling Order (ECF No. 55) and compel the deposition of Ms. Carla Moreno (“Ms. Moreno”), a represented non-party witness, during the requested extended discovery period. Mot. at 7.1 For the reasons that follow, the Court GRANTS IN PART and DENIES IN PART Plaintiff’s Motion.

I. BACKGROUND

On July 13, 2018 Plaintiff filed this action against Defendant Carlos Leyva a/k/a/ AJ&I Construction Clean Up (“Defendant”) under the Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”), Fla. Stat. § 501.204(1), alleging that Defendant breached an employment agreement with Plaintiff when he opened a side business during his employment, operated that business in competition with Plaintiff, and used Plaintiff’s employees, business assets, and resources to operate that business. Mot. at 2; see also Compl. at 2, ECF No. 2. Plaintiff claims to have lost more than $100,000 in business revenue and customer contracts since Defendant started his side business competing with it. See Compl. at 2.

Plaintiff seeks to depose Ms. Moreno, who worked for Plaintiff during the same time Plaintiff employed Defendant and again after Defendant stopped working for Plaintiff. Mot. at 2. Plaintiff asserts that Ms. Moreno is a non-party witness with knowledge of relevant facts in this case because Defendant claims that Plaintiff’s business losses “were caused in part by Moreno’s poor work performance.” Id. Moreover, Plaintiff asserts that “Defendant and Moreno are romantically involved and, [based] on information and *606 belief, now work together in business in competition with [Plaintiff].” Id.

While Ms. Moreno is not a party to this case, Plaintiff states that she has filed a complaint against it with the Equal Employment Opportunity Commission (“EEOC”), in which she is represented by attorneys Enrique Chavez and Michael Anderson. Id. at 2–3. On October 18, 2019, Plaintiff served Ms. Moreno a subpoena for her testimony at a deposition on October 25 regarding the above-captioned case. See Notice, ECF No. 78. On October 23, Plaintiff’s attorney in the EEOC matter, Nathan Pearman, emailed Ms. Moreno’s attorneys to inform them that “he would telephonically attend the deposition” of their client. Mot. at 3. But the next day, Ms. Moreno’s attorneys responded to Pearman’s email, stating that they would not attend the deposition and that:

Our firm does not represent Carla Moreno in the case of Camoco, LLC v. Carlos Leyva. We do not intend to make an appearance in that case. Ms. Moreno is not a party in that case.

We do not consent to any questioning of Ms. Moreno, at the deposition for the Leyva matter [sic], in any way concerning Ms. Moreno’s EEOC charges or claims at the deposition for the unrelated Leyva matter, any questions to Ms. Moreno regarding her EEOC charges are prohibited by the Rules of Professional Conduct.

Id., Ex. A at 2, ECF No. 79-1.

Before Ms. Moreno’s deposition began on October 25, 2019, Plaintiff’s attorney in the instant case spoke with one of Ms. Moreno’s attorneys by phone. Id. at 3. Ms. Moreno’s attorney told Plaintiff’s attorney that “he did not object to Moreno being deposed, but [that] he would not attend the deposition and objected that any questioning of Moreno about her past or present employment would violate the Rules of Disciplinary Conduct.” Id. at 3–4. Out of an abundance of caution, Plaintiff’s counsel limited his questioning of Ms. Moreno during the October 25 deposition. Id. at 4. Plaintiff’s counsel then suspended the deposition pending the outcome of the instant motion to compel. Id.

II. APPLICABLE LAW

A. Scope of Discovery

Under Rule 26(b), “[p]arties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense.” Fed. R. Civ. P. 26(b)(1). “Relevant information encompasses ‘any matter that bears on, or that reasonably could lead to other matter that could bear on, any issue that is or may be in the case.’ ” Merrill v. Waffle House, Inc., 227 F.R.D. 467, 470 (N.D. Tex. 2005) (quoting Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 351, 98 S.Ct. 2380, 57 L.Ed.2d 253 (1978)). “Relevancy is broadly construed, and a request for discovery should be considered relevant if there is ‘any possibility’ that the information sought may be relevant to the claim or defense of any party.” Sheldon v. Vermonty, 204 F.R.D. 679, 689 (D. Kan. 2001) (quoting Scott v. Leavenworth Unified School Dist. No. 453, 190 F.R.D. 583, 585 (D. Kan. 1999)). “The party seeking discovery bears the initial burden of showing that the materials and information sought are relevant to the action or will lead to the discovery of admissible evidence.” Reynolds v. Cactus Drilling Co., LLC, No. M015CV00101DAEDC, 2015 WL 12660110, at *2 (W.D. Tex. Dec. 21, 2015). However, “[o]nce the party seeking discovery establishes that the materials requested are within the scope of permissible discovery, the burden shifts to the party resisting discovery to show why the discovery is irrelevant, overly broad, unduly burdensome or oppressive, and thus should not be permitted.” Id.

The scope of discovery is within the sound discretion of the trial judge, see Freeman v. United States, 556 F. 3d 326, 341 (5th Cir. 2009), who may “tailor discovery narrowly and ... dictate the sequence of discovery,” Crawford–El v. Britton, 523 U.S. 574, 598, 118 S.Ct. 1584, 140 L.Ed.2d 759 (1998). However, the Court must limit discovery, if it determines, on motion or on its own, that “the discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive” or “the *607 proposed discovery is outside the scope permitted by Rule 26(b)(1).” Fed. R. Civ. P. 26(b)(2)(C). Rule 26(b), although broad, may not be used “as a license to engage in an unwieldy, burdensome, and speculative fishing expedition.” Murphy v. Deloitte & Touche Grp. Ins. Plan, 619 F.3d 1151, 1163 (10th Cir. 2010).

B. Subpoenas and Motion to Quash or Modify Subpoenas

Federal Rule of Civil Procedure 30(a)(1) provides that a party may depose any party or non-party and compel their attendance to the deposition by a subpoena under Rule 45. Fed. R. Civ. P. 30(a)(1). Rule 45 governs discovery from non-parties through the issuance of subpoenas. See Fed. R. Civ. P. 45 advisory committee’s notes to 2013 amendment (In Rule 45, “ ‘person’ is substituted for ‘party’ because the subpoena may be directed to a nonparty.”). As with any other forms of discovery, the scope of discovery through a Rule 45 subpoena is governed by Rule 26(b). See Chamberlain v. Farmington Sav. Bank, No. 3:06CV01437 CFD, 2007 WL 2786421, at *1 (D. Conn. Sept. 25, 2007) (citing, inter alia, Fed. R. Civ. P. 45 advisory committee’s notes to 1970 amendment (stating “the scope of discovery through a subpoena is the same as that applicable to Rule 34 and the other discovery rules”)); Shukh v. Seagate Tech., LLC, 295 F.R.D. 228, 236 (D. Minn. 2013) (“[S]ubpoenas issued under Rule 45 are subject to the same constraints that apply to all of the other methods of formal discovery.” (internal quotation marks and citation omitted)).

C. Motions to Compel Discovery

Under Federal Rule of Civil Procedure 37(a)(3)(B)(i), a party seeking discovery may move for an order compelling an answer, designation, production, or inspection when “a deponent fails to answer a question asked under Rule 30 or 31.” Fed. R. Civ. P. 37 (a)(3)(B). The party resisting discovery must show how each discovery request is not relevant or otherwise objectionable. See McLeod, Alexander, Powel & Apffel, P.C. v. Quarles, 894 F.2d 1482, 1485 (5th Cir. 1990).

III. DISCUSSION

A. Extension of Deadline

While Plaintiff’s instant motion was pending, the parties filed on November 1, 2019, a “Stipulation Regarding Extension of Discovery Deadline” (ECF No. 82), in which the parties extended the Scheduling Order discovery deadline from November 1, 2019, see Scheduling Order (ECF No. 55), to December 1, 2019. Accordingly, the Court DENIES as MOOT Plaintiff’s motion as to the extension of the discovery deadline.

B. Compelling Ms. Moreno’s Testimony

Plaintiff moves to compel Ms. Moreno’s deposition after her attorneys declined to consent to Plaintiff asking any questions about her past employment with Plaintiff, her separation from it, her current employment, and anything relating to her EEOC discrimination claim. Mot. at 4; see also Suppl. Mot., Ex. 1 at 3 (ECF No. 80-1). Plaintiff claims that questions on these subjects are particularly relevant to its claims against Defendant and to Ms. Moreno’s credibility as a witness in this case, even though the facts here and those in the EEOC charge may overlap and be jointly relevant. Mot. at 4–5. Ms. Moreno’s attorneys communicated their opposition to questions on these subjects after stating that they would not attend Ms. Moreno’s deposition because they do not represent her in this case. Id., Ex. A at 2, ECF No. 79-1. Further, Ms. Moreno’s attorneys contend that if Plaintiff makes any such questions, then Plaintiff would be violating the Rules of Professional Conduct—namely, Texas Disciplinary Rule of Professional Conduct 4.02.2 Accordingly, the Court will first *608 address whether Plaintiff would be violating Rule 4.02 under these circumstances and then, whether Plaintiff can still depose Ms. Moreno on these facts.

1. Texas Disciplinary Rule of Professional Conduct 4.02

Texas Disciplinary Rule of Professional Conduct 4.02 provides that:

In representing a client, a lawyer shall not communicate or cause or encourage another to communicate about the subject of the representation with a person, organization or entity of government the lawyer knows to be represented by another lawyer regarding that subject, unless the lawyer has the consent of the other lawyer or is authorized by law to do so.

Tex. Disciplinary R. Prof’l Conduct 4.02(a) (2019). Specifically, Rule 4.02 prohibit all communications between a lawyer and a represented person only when:

(1) the communication occurs in the course of the lawyer’s representation of a client or the lawyer’s interests;

(2) the person with whom the lawyer communicates is represented;

(3) the communication is on the subject of both the lawyer’s representation and the person’s representation; and

(4) the lawyer knows that the person is represented on that subject.

In re Newell, 348 Or. 396, 234 P.3d 967, 972 (2010) (analyzing the text and purpose of Oregon’s Rule of Professional Conduct (“RPC”) 4.2); see also § 9:2. Rule 4.02 Communication with person represented by counsel, 48A Tex. Prac., Tex. Lawyer & Jud. Ethics § 9:2 (2019 ed.) (noting that Oregon’s RPC 4.2 is the counterpart to Texas’ Rule 4.02). Rule 4.02 does not “prohibit communication between a lawyer’s client and persons ... represented by counsel, as long as the lawyer does not cause or encourage the communication without the consent of the lawyer for the other party.” Tex. Disciplinary R. Prof’l Conduct 4.02(a) cmt. 2.; see also In re News Am. Pub., Inc., 974 S.W.2d 97, 100 (Tex. App.—San Antonio 1998), subsequent mandamus proceeding sub nom. In re Users System Services, Inc., 22 S.W.3d 331 (Tex. 1999). A lawyer may also engage in ex parte communications with a represented party without the knowledge or consent of that party’s lawyer if “authorized by law to do so.” Tex. Disciplinary R. Prof’l Conduct 4.02(a). The purpose of the rule is “to preserve the integrity of the client-lawyer relationship by protecting the represented party from the superior knowledge and skill of the opposing lawyer.” In re News, 974 S.W.2d at 100 (internal citations omitted). The rule protects the represented party not only from the influences of “opposing counsel’s ‘calculated and self-serving approaches’ [but also] from ‘misguided but well-intended communications.’ ” Id. (internal citations omitted).

Plaintiff’s first argument is that Rule 4.02 does not apply to limit its examination of Ms. Moreno because (1) Plaintiff’s counsel in this case does not represent Plaintiff in the EEOC matter; and (2) Ms. Moreno is unrepresented in this case. Mot. at 5. In support, Plaintiff cites to American Bar Association (“ABA”) Model Rule of Professional Responsibility 4.2.3 from which Texas Rule 4.02 is modeled after, and contends that “both rules state that ‘[i]n representing a client,’ the lawyer may not communicate ‘about the subject of the representation’ with a person represented by another lawyer ‘in the matter[.]’ ” Id. (alterations in original). In other words, at issue is the scope of Rule 4.02’s covered communications—namely, “the subject *609 of the representation.” Tex. Disciplinary R. Prof’l Conduct 4.02(a) (emphasis added). To date, no Texas ethics opinion or judicial decision has addressed this issue.

The Court finds that Plaintiff’s argument fails for multiple reasons. First, Plaintiff misunderstands the extent to which Local Rule AT-7 “permits consultation of the ABA Model Rules of Professional [Responsibility].” Mot. at 5. Plaintiff appears to interpret Local Rule AT-7 to allow unfettered consultation of the ABA Model Rules for issues regarding professional conduct. But instead, Local Rule AT-7 permits consultation of the ABA Model Rules of Professional Conduct only “[f]or matters not covered by the Texas [Disciplinary Rules of Professional Conduct].” W.D. Local R. AT-7(a). Here, Texas Disciplinary Rule of Professional Conduct 4.02 covers the same matters as ABA Model Rule of Professional Responsibility 4.2 because both “prohibit an attorney representing a client from communicating about the subject of the representation with a party the attorney knows to be represented by another attorney[,] ... without authorization from the other attorney, the law, or the court.” Del Mor Logistics, 2014 WL 12580441, at *2. Thus, pursuant to Local Rule AT-7, the issue before the Court must be analyzed under Texas Rule 4.02 and not under ABA Model Rule 4.2.

Second, while Texas Rule 4.02 is modeled after ABA Model Rule 4.2, the plain text of Rule 4.02 “is considerably broader in scope than the Model Rule.” § 9:2. Rule 4.02 Communication with person represented by counsel, 48A Tex. Prac., Tex. Lawyer & Jud. Ethics § 9:2 (2019 ed.). Rule 4.02 is broader in scope because it prohibits a lawyer from communicating about “the subject of the representation” with a person represented by another lawyer “regarding that subject.” Tex. Disciplinary R. Prof’l Conduct 4.02(a) (emphasis added). By contrast, ABA Model Rule 4.2 prohibits a lawyer from communicating about “the subject of the representation” with a person represented by another lawyer “in the matter.” Model Rules of Prof’l Responsibility R. 4.2 (Am. Bar. Ass’n 2002) (emphasis added). Put differently, Rule 4.02 covers communications between a lawyer and a represented person about subjects that may touch on any legal matter for which the latter is represented. See Newell, 234 P.3d at 972(holding that Oregon Rule of Professional Conduct 4.2—which is substantially similar to Texas Rule 4.02—was not limited to the specific proceedings in which the party is represented, and that it covered any communications related to the subject matter that necessarily involved such proceedings). Meanwhile, ABA Model Rule 4.2 is limited to communications between a lawyer and a represented person when the latter is represented in the specific legal matter on which the communications are based upon. See People v. Santiago, 236 Ill.2d 417, 339 Ill.Dec. 1, 925 N.E.2d 1122, 1129 (2010) (agreeing with the State in that the drafters of Illinois Rule of Professional Conduct 4.2—which is substantially similar to ABA Model Rule 4.2—“intended the application of the rule to be case specific: specific to the matter in which the party is represented.”).

The broader scope of Rule 4.02’s plain text is consistent with what the rule’s comments and Texas state courts have stated is the main purpose of the rule: “to preserve the integrity of the client-lawyer relationship by protecting the represented party from the superior knowledge and skill of the opposing lawyer.” In re News, 974 S.W.2d at 100 (internal citations omitted); Tex. Disciplinary R. Prof’l Conduct 4.02(a) cmt. 1 (“[T]his Rule is directed at efforts to circumvent the lawyer-client relationship existing between other persons ... and their respective counsel.”). It appears to the Court that the drafters’ main concern was the potential for attorneys, who are representing clients with adverse interests to those of the represented persons, to influence such persons outside the presence or without the consent of their own counsel. Accordingly, it stands to reason that it would make little practical sense for the rule to be oblivious to communications touching on subjects relating to matters for which such persons are represented.

*610 For that reason, Plaintiff fails to persuade the Court to adopt the narrower view by citing to the ABA Model Rule. As discussed supra, ABA Model Rule 4.2 does not govern this case; Texas Disciplinary Rule of Professional Conduct 4.02 does. To be sure, Texas Rule 4.02 was modeled after ABA Model Rule 4.2, but the plain text of Rule 4.02 strongly indicates that its drafters intended its application to differ. Therefore, Plaintiff’s counsel may violate Rule 4.02 if he asks Ms. Moreno any questions eliciting answers that are imbued with facts touching on the subject matter of her EEOC charge against Plaintiff. On that basis, Plaintiff may only ask Ms. Moreno questions with her attorneys’ consent—which the record establishes that he does not have—or if he is “authorized by law to do so.” Tex. Disciplinary R. Prof’l Conduct 4.02(a).

With that in mind, Plaintiff alternatively argues that, even if applicable, Rule 4.02 does not limit its examination of Ms. Moreno because her deposition was “authorized by law” after she was subpoenaed to testify in this case. Mot. 5. The precise scope and meaning of the phrase “authorized by law” has yet to be the subject of a reported Texas ethics opinion or judicial decision in the context of depositions. However, the same language was at issue in an analogous case before the Oregon Supreme Court where it construed that state’s counterpart to Rule 4.02.

In In re Newell, 348 Or. 396, 234 P.3d 967, 972 (2010), an accountant was alleged to have embezzled funds from the company that employed him and from a second company that had later purchased the employer-company. Newell, 234 P.3d at 968. The accountant’s wrongdoing spawned three lawsuits: (1) a civil lawsuit by the employer-company against the accountant for the funds he embezzled; (2) a criminal action against the accountant for embezzlement; and (3) a civil lawsuit by the second company against the employer-company for overpayment resulting in part from the accountant’s embezzlement. Id. at 968–69. While the second civil case was approaching trial, the first civil case settled, and the accountant was awaiting sentencing in the criminal case. Id. at 969. The second company’s counsel—the respondent in the disciplinary action—unsuccessfully attempted multiple times to interview the accountant through his attorney in the criminal case because the accountant was not represented in the second civil case. Id. As the trial date neared, the respondent issued a notice of deposition and subpoenaed the accountant without advising his counsel in the criminal case. Id. at 969–70. The accountant appeared for his deposition without his counsel and he was questioned extensively about matters germane not only to the relevant civil lawsuit, but also to the criminal action. Id. at 970–71. After he was reported to the state bar’s disciplinary authorities, the respondent argued that his communications with the accountant were “authorized by law” because he had subpoenaed the accountant prior to the deposition in compliance with the Oregon Rules of Civil Procedure. Id. at 974.

The Oregon Supreme Court disagreed with the respondent in his broad reading of the “authorized by law” exception. Id. The court noted that this broad reading was particularly problematic because it meant that:

[A]s long as a lawyer can subpoena a nonparty witness to testify at trial or in a deposition before the witness has an opportunity to contact his or her own lawyer, the “authorized by law” exception would permit the lawyer to ask that witness unlimited questions without any opportunity for the witness’s lawyer to protect his or her client’s interests. That interpretation of the exception, if accepted, would undermine the purpose of the rule.

Id. As such, the Oregon Supreme Court held that the respondent was not “authorized by law” just because he had complied with the applicable rules of civil procedure pertaining to the taking of depositions of non-party witnesses. Id. at 976.

The Court finds that Plaintiff’s argument is practically undistinguishable from that of the respondent’s in Newell. Nevertheless, Plaintiff attempts to distinguish his argument by arguing that *611 Federal Rule of Civil Procedure 45 provides an exception to Rule 4.02(a), citing to a 2002 opinion from the Texas Attorney General in which a Texas Workers’ Compensation Commission rule was deemed to provide an exception to Rule 4.02(a). Mot. at 5 (citing Tex. Att’y Gen. Op. No. JC-0572 (Nov. 5, 2002)). In that opinion, the issue was whether the Commission’s rule requiring insurance carriers, employers, and health care providers to send copies of all written communications related to a claim to both the represented claimant and the claimant’s attorney provided an exception to Rule 4.02(a). Id. This requirement, or notice provision, placed attorneys representing insurance carriers, employers, and health care providers “in a difficult and unfair position” because compliance with the Commission’s rule would violate Rule 4.02. Id. The Texas Attorney General opined that since state case law held that statutory notice provisions provided an exception to Rule 4.02,4 then “[a] procedural notice or service requirement imposed by an administrative rule ... may also provide an exception to Rule 4.02(a)” because rules and regulations promulgated “by an administrative agency acting within its statutory authority have the force and effect of legislation.” Id. (citing Lewis v. Jacksonville Bld. Loan Ass’n, 540 S.W.2d 307, 310 (Tex. 1976)). Further, the Texas Attorney General found that the rule was still consistent with Rule 4.02’s purpose, reasoning that:

[T]his procedural rule, which serves to keep claimants fully informed of the status of their claims through the receipt of written communications that must also be sent to their attorneys, see 24 Tex. Reg. 6488, 6489 (1999) (explaining purpose of amendment to rule), does not appear to provide attorneys with an opportunity to take advantage of claimants or to undermine claimants’ relationships with their attorneys.

Id.

But the issue in the Texas Attorney General’s opinion is distinguishable from the issue in the instant case. Specifically, they are distinguishable because Plaintiff’s argument impliedly conflates the functions of Federal Rules of Civil Procedure 30 and 45. Rule 30 provides that a party may depose any party or non-party and compel their attendance to the deposition by a subpoena under Rule 45. Fed. R. Civ. P. 30(a)(1). The two rules may interplay with one another, but their function in the context of attorney communications with represented persons differs. Rule 30 relates to the communications between an attorney and a represented person that take place during the examination by oral questions—a deposition—for purposes of discovery. Id. In contrast, Rule 45 relates to the communications between an attorney and a represented person to compel the attendance of such a person to the deposition, that is, by issuance of a subpoena. Fed. R. Civ. P. 45. Compelling a deponent’s attendance to a deposition via a subpoena under Rule 45 appears analogous to the Commission’s rule in the Texas Attorney General’s opinion because they both function as notice provisions and “do[ ] not appear to provide attorneys with an opportunity to take advantage of [the represented persons] or to undermine [their] relationships with their attorneys.” Tex. Att’y Gen. Op. No. JC-0572 (Nov. 5, 2002). However, an examination by oral questions for purposes of discovery—a deposition under Rule 30—does provide attorneys with such an opportunity, and if deemed to satisfy the “authorized by law” exception, “[s]uch a conclusion would minimize the attorney’s ethical obligation under the Rule and would create an exception that would threaten to swallow the Rule.” Monceret v. Bd. of Prof. Resp., 29 S.W.3d 455, 461 (Tenn. 2000). Thus, “[t]hese are two separate communications ... [and] [j]ust because counsel may have issued a subpoena permissible under [Rule 4.02] does not mean that counsel’s later deposition of the witness pursuant to that subpoena is also protected[.]” Parker v. Pepsi-Cola Gen. Bottlers, Inc., 249 F. Supp. 2d 1006, 1011 (N.D. Ill. 2003) (emphasis in original).

Therefore, the Court concludes that the deposition of represented persons under *612 Federal Rule of Civil Procedure 30 does not satisfy the “authorized by law” exception to Texas Disciplinary Rule of Professional Conduct Rule 4.02 just because attorneys have compelled their attendance to the deposition via subpoena under Federal Rule of Civil Procedure 45. As such, Plaintiff’s counsel is not “authorized by law” to depose Ms. Moreno just because he issued her a subpoena in compliance with Federal Rule of Civil Procedure 45.

To this end, Plaintiff’s counsel may only be “authorized by law” to depose Ms. Moreno on the requested subjects if authorized by court order. Compared to ABA Model Rule 4.2, Texas Rule 4.02 does not include the phrase “authorized by law or a court order.” Model Rules of Prof’l Conduct R. 4.2 (2002) (emphasis added). Whether the phrase “authorized by law” in Rule 4.02 includes authorization by court order is not covered in the rule’s comments. Nor is this question covered by a Texas ethics opinion or judicial decision. Accordingly, under Local Rule AT-7, the Court consults the ABA Model Rules of Professional Responsibility and their pertinent interpretive opinions. See W.D. Local R. AT-7(a).

Before Model Rule 4.2 contained the phrase “authorized by law or a court order”,5 the ABA issued a formal opinion in 1995 in which it defined the “authorized by law” phrase to include a court order. See ABA Committee on Ethics and Professional Responsibility Formal Opinion 95-396 at 20 [hereinafter “ABA Formal Opinion 95-396”]. The formal opinion particularly noted that “in appropriate circumstances, a court order could provide the necessary authorization.” Id. (citing United States v. Lopez, 989 F.2d 1032, 1099 (9th Cir. 1993), opinion amended and superseded, 4 F.3d 1455 (9th Cir. 1993)). Since the ABA’s 1995 formal opinion, “courts have generally agreed that they have the power to permit such ex parte communications in particular circumstances.” Wagner v. City of Holyoke, 183 F. Supp. 2d 289, 292 (D. Mass. 2001). In 2002, Model Rule 4.2 was revised and amended to include the phrase as it reads today to reflect the ABA’s 1995 formal opinion interpretation and “clarify that a court may permit or prohibit contact in a particular case.” Palmer v. Pioneer Inn Assocs., Ltd., 118 Nev. 943, 59 P.3d 1237, 1241 n.18 (2002).

Texas Rule 4.02 as it reads today was first adopted in October 1989 and became effective on January 1990—five years before the 1995 opinion interpreting the phrase “authorized by law” to include court orders. See Tex. Disciplinary R. Prof’l Conduct 4.02(a); ABA Formal Opinion 95-396. Accordingly, the Court finds that the phrase “authorized by law” in Texas Rule 4.02 includes authorization by court order. And thus, the Court now considers whether to authorize Plaintiff to depose Ms. Moreno based on the relevance of the information it seeks.

2. Relevance

Plaintiff argues that facts related to Ms. Moreno’s past employment, her present employment, and her EEOC charge against Plaintiff are all relevant to this case. Mot. at 4. As a threshold matter, Plaintiff has the burden of proving that the information sought is relevant to this action. See Reynolds, 2015 WL 12660110 at *2. Plaintiff argues that information he seeks from Ms. Moreno is relevant because (1) she and Defendant were employed by Plaintiff during the same period of time; (2) Defendant “stated his belief that [Plaintiff’s] losses were caused in part by [her] poor work performance”; (3) she and Defendant are romantically involved; (4) she presently works together with Defendant in another business in competition with Plaintiff; and (5) specifically to the EEOC charge, it speaks to her credibility as a witness in the instant case. Mot. at 2, 4. Ms. Moreno’s attorneys do not object to the *613 relevance of the information Plaintiff seeks, but merely do not consent to questions related to her termination and her allegations to the EEOC. See Suppl. Mot. at 3 (“MR. ANDERSON: ... We’re not really concerned about the fact, you know, she admits she was an employee, what she was doing there, describe how she was a witness. It’s specifically the allegations of the EEOC and the reasons for her termination that we do not consent as to her being questioned.”).

The Court finds that facts related to Ms. Moreno’s past employment with Plaintiff during the time she and Defendant worked together, as well as her present employment with Defendant in a business that directly competes with Plaintiff, are relevant to the merits of Plaintiff’s claims for breach of contract and the FDUTPA. Particularly, these facts might be relevant to prove Plaintiff’s allegations that Defendant used Plaintiff’s employees, business assets, and resources to operate his business competing directly with Plaintiff. Mot. at 2; see also Compl. at 2. Such information might be also relevant towards Defendant’s assertion that Plaintiff’s “losses were caused in part by [Ms. Moreno’s] poor work performance.” Mot. at 2. Moreover, Ms. Moreno’s romantic involvement with Defendant might be relevant to such claims and to her credibility as a witness in the instant case. Id. Therefore, Plaintiff’s explanations are sufficient to meet its initial burden for these facts.

However, Plaintiff fails to persuade the Court that facts related to Ms. Moreno’s EEOC charge against it are relevant. Plaintiff has not made clear to the Court how exactly Ms. Moreno’s EEOC allegations are relevant to Defendant’s claims against it besides pointing to her credibility as a witness. Because her credibility as a witness can already be challenged through her romantic involvement with Defendant, Plaintiff’s explanation for the relevance of these facts makes this discovery “cumulative and duplicative.” Fed. R. Civ. P. 26(b)(2)(C). If anything, Plaintiff appears be seeking information that might be relevant to challenge the EEOC charge through Ms. Moreno’s deposition in this case. Particularly telling is the fact that Mr. Pearman, Plaintiff’s counsel in the EEOC charge, was attending Ms. Moreno’s deposition by phone. Mot. at 3. Mr. Pearman’s attendance suggests that Plaintiff is trying to engage in an “speculative fishing expedition” to effectively kill two birds with one stone. See Murphy, 619 F.3d at 1163. Hence, Plaintiff has failed to meet its burden regarding these facts.

Accordingly, Plaintiff’s Motion to Compel is GRANTED as to the information regarding Ms. Moreno’s past employment as it relates to the time she and Defendant worked together, her present employment, and her romantic involvement with Defendant. Further, it is DENIED as to any information regarding Ms. Moreno’s past employment as it relates to the basis of her EEOC charge.

IV. CONCLUSION

Accordingly, IT IS ORDERED that Plaintiff Camoco, LLC’s “Emergency Motion to Extend Discovery Deadline and Compel Deposition of Non-Party Witness” (ECF No. 79) is GRANTED IN PART and DENIED IN PART.6 The parties SHALL COMPLY with the instructions provided in this Memorandum Order.

So ORDERED and SIGNED this 19th day of November 2019.

Footnotes

1

On October 30, 2019, Plaintiff also filed his “First Supplemental Emergency Motion to Extend Discovery Deadline and Compel Deposition of Non-Party Witness” (ECF No. 80) (“Supplemental Motion”). Therein, Plaintiff attaches excerpts from the deposition of Ms. Moreno because when the original motion was filed, Plaintiff states that the transcript was not yet available. Suppl. Mot. at 1. The Court will consider First Supplemental Motion as part of Plaintiff’s Motion.

2

The Local Rules of this district adopt by reference the standards of professional conduct set out in the Texas Disciplinary Rule of Professional Conduct for all attorneys permitted to practice before the Court. See W.D. Local R. AT-7(a); Del Mor Logistics, LLC v. GB Carriers, LLC, EP-14-CV-053-DB, 2014 WL 12580441, at *2 (W.D. Tex. July 7, 2014).

3

The ABA Model Rule of Professional Responsibility 4.2 provides that:

In representing a client, a lawyer shall not communicate about the subject of the representation with a person the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized to do so by law or a court order.

Model Rules of Prof’l Responsibility R. 4.2 (Am. Bar. Ass’n 2002).

4

See Lee v. Fenwick, 907 S.W.2d 88 (Tex. App.—Eastland 1995, writ denied).

5

In 1995, Model Rule 4.2 provided that:

In representing a client, a lawyer shall not communicate about the subject of the representation with a person that the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized by law to do so.

Model Rules of Prof’l Responsibility R. 4.2 (1995).

6

Under Federal Rule of Civil Procedure 37(a)(5), a movant may request attorney’s fees and payment of reasonable costs incurred in the filing of a motion to compel that was granted. However, Rule 37(a)(5)(C) explains “[i]f the motion is granted in part and denied in part, the court ... may, after giving an opportunity to be heard, apportion the reasonable expenses for the motion.” Plaintiff did not request any relief under Rule 37(a)(5), and so the Court does not reach the question of the payment of expenses. Going forward, however, should the Court be called upon to resolve any further discovery disputes, it will not hesitate to sanction the non-prevailing party if it is found to have acted unreasonably.

United States District Court, W.D. Texas, Austin Division.

R.M. PERSONNEL, INC., Plaintiff,

v.

LIBERTY MUTUAL FIRE INSURANCE COMPANY, Defendant.

Cause No.: A-16-CA-01030-SS

|

Signed 06/20/2019

|

Filed 06/21/2019

Attorneys & Firms

David E. Chamberlain, Timothy Poteet, Chamberlain McHaney, Austin, TX, David J. Campbell, O’Hanlon, McCollom & Demerath, Austin, TX, for Plaintiff.

David Lawrence Plaut, Hanna & Plaut, LLP, Austin, TX, for Defendant.

ORDER

SAM SPARKS, SENIOR UNITED STATES DISTRICT JUDGE

*1 BE IT REMEMBERED on this day the Court reviewed the file in the above-styled cause, and specifically Plaintiff R.M. Personnel, Inc. (RMP)’s Motion for Leave to File First Amended Complaint [#44] and Motion for Leave to Amend Scheduling Order [#45], Defendant Liberty Mutual Fire Insurance Company (Liberty)’s Response [#46] in opposition and RMP’s Reply [#47] thereto. Having considered the case file and the applicable law, the Court enters the following opinion and orders.

Background

This case concerns a dispute over insurance coverage in the aftermath of an accident at a commercial construction site in El Paso, Texas. RMP provides temporary workers to a number of business clients, including construction companies. At the time of the accident at the heart of this case, RMP was insured under a workers’ compensation and employer’s liability policy issued by Liberty. See Pl.’s Mot. Summ. J. Ex. 3 [#16-1] (Policy). Under the Policy, Liberty is required to provide defense and indemnity coverage for “bodily injury by accident” if “[t]he bodily injury ... arise[s] out of and in the course of the injured employee’s employment by [RMP].” Id. at LM 2796.

During the period covered by the Policy, RMP assigned employees to a company called Perspectiva, a general contractor and project architect in charge of a construction project in El Paso. Def.’s Status Report [#38-1] Ex. A (El Paso Opinion) at 2. On September 17, 2007, Luis Alberto Rodriguez, one of RMP’s assigned workers, fell fifty feet down an elevator shaft and sustained catastrophic injuries. Id. at 3–4.

Shortly after Rodriguez’s accident, a dispute arose between Liberty and New Hampshire Insurance Company—Perspectiva’s workers’ compensation insurance carrier—over which company should be responsible for paying benefits to Rodriguez. Id. at 4–5. To resolve this dispute, an administrative hearing was held in July 2009 before the Workers’ Compensation Division of the Texas Department of Insurance (the Division). Id. at 5. The Division was asked to determine which entity was Rodriguez’s employer at the time of the injury. Id. “The Division found that because Perspectiva controlled the details of Rodriguez’s work while he was at the job site, Perspectiva and not [RMP] was Rodriguez’s employer under the [Texas Workers’ Compensation] Act.” Id. The Division’s decision was not appealed. Id.

In September 2009, Rodriguez sued Perspectiva and a subcontractor, contending that both caused his injuries. Id. The trial court then granted the subcontractor’s request to hold RMP as a responsible third party, and on November 2, 2010, Rodriguez amended his petition to include RMP as a defendant in the state court suit. Id. at 5. After being served with Rodriguez’s amended petition, RMP requested Liberty provide its defense as required by the Policy. Compl. [#1] ¶ 6; Answer [#2] ¶ 6. Liberty denied this request, claiming it had no duty to defend because Rodriguez’s petition failed to allege an employment relationship between RMP and Rodriguez. See Compl. [#1] ¶ 11; Answer [#2] ¶ 11.

*2 Shortly after Liberty denied RMP’s request to defend, RMP moved for summary judgment in the state court suit, arguing it was immune from suit under the Texas Workers’ Compensation Act’s exclusive remedy provision. El Paso Opinion at 6. That provision states the “[r]ecovery of worker’s compensation benefits is the exclusive remedy of an employee covered by workers’ compensation insurance coverage.” TEX. LABOR CODE § 408.001(a). RMP contended that it was eligible for this exclusive remedy immunity because, under the Texas Supreme Court’s opinion in Wingfoot Enterprises v. Alvarado, 111.S.W.3d 134 (Tex. 2003), a temporary staffing agency may be an employer under the Texas Workers’ Compensation Act. In response, Rodriguez, New Hampshire Insurance, and the subcontractor argued that RMP was collaterally estopped by the Division’s order from asserting exclusive remedy immunity or, in the alternative, that RMP was not Rodriguez’s employer under the Act. See El Paso Opinion at 6. The trial court denied the motion for summary judgment for reasons that are not stated in the record. Id.

The state court trial began in March 2015. Compl. [#1] ¶ 9. At the close of evidence, RMP moved for directed verdict, reurging its argument that it was entitled to exclusive remedy immunity as Rodriguez’s employer under Wingfoot. See Brief of Appellant R.M. Personnel, Ltd. at 6–7, New Hampshire Insurance Company v. Rodriguez, 569 S.W.3d 275 (Tex. App.—El Paso 2019, pet. filed) (No. 08-15-00173-CV). Rodriguez again responded that RMP was not Rodriguez’s employer at the time of the accident and that the Division’s order precluded RMP from asserting exclusive remedy immunity. See id. at 14–15. The trial court again denied RMP’s motion for reasons that are not stated. See id. at 7. The jury found Rodriguez sustained $20.5 million in damages and attributed 17% of the responsibility for the accident to RMP. El Paso Opinion at 6. Accordingly, the trial court rendered judgement assessing $3,743,778.08 in damages against RMP. Id. at 7. RMP and codefendants then appealed.

While the state court appeal was pending, RMP filed a lawsuit in this Court seeking a declaratory judgment regarding Liberty’s duty to defend and indemnify RMP in the state court suit. See Compl. [#1] ¶¶ 14–16. RMP also claimed Liberty’s refusal to defend it in the state court suit was both a breach of the Policy and a violation of the Prompt Payment Act, TEX. INS. CODE § 542.051 et seq. Id. ¶¶ 17–20. RMP then moved for partial summary judgment on the duty-to-defend, breach, and Prompt Payment Act claims. Mot. Partial Summ J. [#11]. The Court granted the motion, reasoning that Liberty owed RMP a duty to defend because Rodriguez’s state court petition alleged that he was RMP’s employee at the time of the accident. See Order of Feb. 16, 2018 [#23] at 9. The Court also found that Liberty breached the Policy and was liable under the Prompt Payment Act because Liberty’s only argument against those claims was that it had owed no duty to defend. Id. Accordingly, the only issue remaining following the Court’s order was RMP’s duty-to-indemnify claim, which could not be resolved until the Court of Appeals issued its opinion in the state court suit.

That opinion was ultimately issued on January 11, 2019. In it, the Court of Appeals held that RMP was not entitled to exclusive remedy immunity because it was not Rodriguez’s employer at the time of the accident. The Court of Appeals concluded RMP was “collaterally estopped from asserting exclusive remedy immunity by virtue of the Division’s unappealed order[ ],” which found that RMP was not Rodriguez’s employer. El Paso Opinion at 21. RMP had argued the Division’s order was not entitled to preclusive effect because RMP was not a party to the administrative hearing and further argued the trial court’s judgment against it was clearly erroneous because it ignored Wingfoot in determining RMP was not Rodriguez’s employer. See id. at 22, 25. The Court of Appeals rejected RMP’s first argument, reasoning that collateral estoppel should apply to the Division’s order because Liberty had been a party before the Division and Liberty’s interests were “sufficiently aligned” with RMP’s. Id. at 24. Having found that collateral estoppel precluded relitigating the employer issue, the Court of Appeals did not determine whether the trial court’s judgment was clearly erroneous for failing to consider Wingfoot. See id. at 25. Following the judgment, RMP entered into a settlement with Rodriguez and filed an unopposed motion to dismiss its petition for review with the Texas Supreme Court. See Reply [#47] at 4; see also Motion to Dismiss of Petitioner at 2, New Hampshire Insurance Company v. Rodriguez, No. 19-0097 (Tex. Jan. 25, 2019). The petition for review from the Texas Supreme Court remains pending for the other state court defendants.

Analysis

*3 In light of the El Paso Opinion, RMP now moves for leave to file a first amended complaint that differs from the original complaint in two ways. First, RMP seeks to add facts that would show collateral estoppel does not bar this Court from considering whether RMP was Rodriguez’s employer.1 See Mot. Amend [#44-1] at 23–25. Second, RMP seeks to add a claim that Liberty breached the Policy by failing to indemnify RMP as well as claims for fraud and unjust enrichment based on Liberty’s allegedly intentional failure to fairly represent RMP’s interests in the Division hearing. See id. at 28–29. RMP also seeks to amend the scheduling order because the key dates in the prior scheduling order have passed due to the exceptional length of the pendency of the state court appeals. Mot. Extend [#45].

I. Motion to Modify the Scheduling Order

“Rule 16(b) governs amendment of pleadings after a scheduling order deadline has expired.” S&W Enters., LLC v. Southtrust Bank of Ala., N.A., 315 F.3d 533, 536 (5th Cir. 2003). Thus, where the scheduling order precludes the filing of amended pleadings, the movant must first demonstrate good cause for modification of the order. FED. R. CIV. P. 16(b)(4). Only then may the court consider whether leave to amend should be granted or withheld under the more liberal pleading standard of Rule 15(a)(2).

The Fifth Circuit considers four factors in determining whether good cause exists to modify a scheduling order: (1) the explanation for the failure to timely move for leave to amend; (2) the importance of the amendment; (3) the potential prejudice to the nonmoving party; and (4) the availability of a continuance to cure prejudice. S&W Enters., 315 F.3d at 256. Consideration of these factors demonstrates good cause exists here.

First, RMP has provided an adequate explanation of its delay in moving to amend. RMP’s delay in amending its complaint was the result of the nearly four-year-long pendency of the state court appeal, a delay RMP could not avoid since resolution of the state court appeal directly impacts RMP’s causes of action in this case. Moreover, RMP moved to amend its complaint less than two weeks after a status conference held by the Court to determine what issues remained in the case. These facts lead the Court to conclude RMP did not unduly delay in moving for leave to amend.

Second, RMP’s proposed amendment is important. Not only does it include facts that will aid the Court in its consideration of the collateral estoppel question, it also includes new claims RMP learned as a result of its investigation into Liberty’s conduct before the Division. Refusing to allow RMP leave to amend its complaint would leave the Court with only minimal input from the parties on the issue of collateral estoppel and would prevent RMP from raising previously undiscovered claims for fraud and unjust enrichment. The Court therefore concludes the second element also favors granting RMP leave to amend.

Third, the proposed amendments are not so prejudicial as to justify denying RMP’s leave to amend. To start, the bulk of Plaintiff’s amendments involves facts and argument in anticipation of collateral estoppel, which is an affirmative defense that was raised by Liberty. Moreover, RMP’s new claims rely on the same facts the Court will be required to consider in the collateral estoppel analysis. The Court therefore anticipates the parties will be able to adapt their pleadings and arguments to take into account RMP’s amendments with relative ease, and it concludes the third element favors granting RMP leave to amend.

*4 Fourth, the Court retains the ability to issue a continuance if necessary. The Court does not believe a continuance is needed at this time but will entertain future requests from the parties.

In sum, the Court finds good cause exists to modify the scheduling order to allow RMP to move for leave to file its amended complaint.

II. Motion for Leave to File Amended Complaint

Having found good cause exists to modify the scheduling order, the Court considers Plaintiff’s motion for leave to amend under Rule 15(a)(2), which states courts should “freely give leave when justice so requires.” FED. R. CIV. P. 15(a)(2). Rule 15’s standard “evinces a bias in favor of granting leave to amend,” and courts may only deny leave when faced with a substantial reason for doing so, such as undue delay, bad faith, dilatory motive, repeated failures to cure deficiencies, futility, or undue prejudice to the opposing party. Mayeuax v. La. Health Serv. & Indem. Co., 376 F.3d 420, 425 (5th Cir. 2004); Stripling v. Jordan Prod. Co., 234 F.3d 863, 873 (5th Cir. 2000).

Liberty does not explain why RMP should not be granted leave to amend its complaint. Instead, it argues that RMP is collaterally estopped from litigating the employer issue in this case or, in the alternative, that such litigation would be an impermissible collateral attack on the El Paso Opinion. The Court construes these arguments as contending that RMP should not be granted leave to amend because the amendment would be futile. But Liberty’s briefing on the collateral estoppel issue is “less than comprehensive,” see El Paso Opinion at 21 n.6, and its Response does not address RMP’s claims for breach of the Policy, fraud, or unjust enrichment. In light of these deficiencies, the Court concludes amendment would not necessarily be futile and therefore GRANTS RMP’s Motion for Leave to First Amended Complaint [#44] without prejudice to Liberty reurging its collateral estoppel defense.

Conclusion

The Court grants RMP’s Motion for Leave to File First Amended Complaint [#44] and its Motion for Leave to Amend Scheduling Order [#45] for the reasons stated above.

Accordingly,

IT IS ORDERED that Plaintiff R.M. Personnel, Inc.’s Motion for Leave to File First Amended Complaint [#44] is GRANTED, and

IT IS FURTHER ORDERED that Plaintiff R.M. Personnel, Inc.’s Motion for Leave to Amend Scheduling Order [#45] is GRANTED, and

IT IS FURTHER ORDERED that Plaintiff shall file an amended complaint in this case by July 3, 2019, and

IT IS FINALLY ORDERED that the parties shall file an agreed scheduling order by July 10, 2019 and that if the parties cannot agree the Court will set the scheduling order.

Footnotes

1

Because Liberty owes RMP a duty to indemnify only if RMP was Rodriguez’s employer at the time of the accident, if RMP is precluded from litigating the employer question it would be unable to prove its duty-to-indemnify claim.

United States District Court, W.D. Texas, El Paso Division.

Ruben MENDEZ, Plaintiff,

v.

WAL-MART ASSOCIATES, INC., Defendant.

EP-18-CV-189-PRM

|

Signed 11/28/2018

Attorneys & Firms

Tiffany Nicole Joudi, Scherr & Legate, PLLC, El Paso, TX, for Plaintiff.

Robert M. Estrada, Steven Joseph Blanco, Blanco Ordonez & Wallace, P.C., El Paso, TX, for Defendant.

ORDER GRANTING DEFENDANT’S MOTION TO COMPEL ARBITRATION

PHILIP R. MARTINEZ, UNITED STATES DISTRICT JUDGE

*1 On this day, the Court considered Defendant Wal-Mart Associates, Inc.’s [hereinafter “Defendant”] “Brief in Support of Demand for Arbitration” (ECF No. 25) [hereinafter “Motion”], filed on October 30, 2018; Plaintiff Ruben Mendez’s [hereinafter “Plaintiff”] “Response in Opposition to Defendant’s Motion to Compel Arbitration”1 (ECF No. 28) [hereinafter “Response”], filed on November 9, 2018; and Defendant’s “Reply to Plaintiff’s Response in Opposition to Defendant’s Demand for Arbitration” (ECF No. 29) [hereinafter “Reply”], filed on November 14, 2018, in the above-captioned cause. After due consideration, the Court is of the opinion that Defendant’s Motion should be granted for the reasons that follow.

I. FACTUAL AND PROCEDURAL BACKGROUND

This case arises out of a workplace injury. Plaintiff alleges that he suffered an injury in the course and scope of his employment with Defendant. Pl.’s Original Compl., Aug. 1, 2018, ECF No. 12 [hereinafter “Complaint”]. Specifically, Plaintiff asserts that he was “stocking a forty pound box of weights on the bottom of a shelf when the shelf broke.” Id. at 2. As a result, he injured his “right shoulder and other parts of his body.” Id.

*2 On May 1, 2018, Plaintiff brought suit against Defendant in state court, alleging that Defendant acted negligently.2 Notice of Removal Ex. A, June 18, 2018, ECF No. 1. Then, on June 18, 2018, Defendant removed the case to federal court, alleging that the Court has diversity jurisdiction over this action pursuant to 28 U.S.C. § 1332. Id. at 1.

Wal-Mart employees participate in a computer-based learning module titled “Texas Injury Care Benefit Plan.” Mot. 1–2, Ex. A. The module educates employees on their rights and responsibilities regarding on-the-job injuries. Id. Relevant here, the module includes information about arbitration. Specifically, employees must open a document—“Appendix D”—which includes an Arbitration Acknowledgement; after viewing the document, employees click to indicate that they have viewed the arbitration policy. Id. Ex. A. Further, while proceeding through the module, employees must click “I understand” in response to the following statement:

I acknowledge that this Walmart and Sam’s Club Texas Injury Care Benefit plan includes a mandatory policy requiring that claims or disputes relating to the cause on an on-the-job injury (that cannot otherwise be resolved between Walmart or Sam’s Club and me) must be submitted to an arbitrator, rather than a judge and jury in court. I acknowledge that I have received this arbitration policy. I understand that the Company is also accepting and agreeing to comply with these arbitration requirements....

Id. Plaintiff completed the module and represented that he understood these provisions by clicking on the relevant boxes. Id. Ex. C at 9.

Additionally, Wal-Mart employees are provided with a “Summary Plan Description,” which is a handbook describing Defendant’s Texas Injury Care Benefit Plan. See Mot. Ex. B. The Summary Plan Description’s Appendix A describes the arbitration process in detail. In relevant part, Appendix A provides that the policy “is equally binding upon, and applies to any such claims that may be brought by, an Employer and each associate....” Id. Ex. B (Summary Plan Description) App. A p. 6. The policy further specifies:

The Company shall have the right and power at any time and from time to time to amend this policy, in whole or in part, on behalf of Employer, and at any time to terminate this Policy or any Employer’s participation, hereunder; provided that no such amendment or termination shall alter the arbitration requirements of this Policy with respect to any injury occurring prior to the date of such an amendment or termination. In addition, any such amendment or termination of this policy shall not be effective until at least 14 days after written notice has been provided....

Id. App. A p. 7.

Based on these facts, Defendant filed the instant Motion on October 30, 2018. Therein, Defendant asserts that a valid arbitration agreement exists and that the Court should therefore compel the parties to participate in binding arbitration.

*3 Plaintiff does not dispute that he completed the module and demonstrated that he understood the arbitration policy by clicking on the pertinent boxes. Rather, Plaintiff disputes the validity of the arbitration agreement. Specifically, Plaintiff argues that the Federal Arbitration Act (“FAA”) does not apply to Plaintiff’s claims because: (1) the agreement does not involve a “contract evidencing a transaction involving commerce” as is required by the FAA, (2) Congress did not intend for the FAA to preempt States’ workers’ compensation schemes, and (3) the FAA as applied violates the Tenth Amendment. Additionally, even if the FAA applies to this type of claim, Plaintiff avers that the agreement to arbitrate should be unenforceable pursuant to Texas state common law because the agreement is illusory and because no valid consideration exists.

II. LEGAL STANDARD

The FAA § 2 provides that:

A written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction ... shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.

9 U.S.C. § 2. This provision “reflect[s] both a ‘liberal policy favoring arbitration’ ... and the ‘fundamental principle that arbitration is a matter of contract.’ ” AT&T Mobility LLC v. Concepcion, 563 U.S. 333, 339 (2011) (quoting Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983) and Rent-A-Ctr., W., Inc. v. Jackson, 561 U.S. 63, 67 (2010) ).

When considering a motion to compel arbitration pursuant to the FAA, courts employ a two-step analysis. “First, a court must ‘determine whether the parties agreed to arbitrate the dispute in question.’ ” Tittle v. Enron Corp., 463 F.3d 410, 418 (5th Cir. 2006) (quoting Webb v. Investacorp., Inc., 89 F.3d 252, 258 (5th Cir. 1996) ). “Second, a court must determine ‘whether legal constraints external to the parties’ agreement foreclosed the arbitration of those claims.’ ” Fleetwood Enters., Inc. v. Gaskamp, 280 F.3d 1069, 1073 (5th Cir. 2002) (quoting Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, 473 U.S. 614, 628 (1985) ).

The first step of the analysis—whether the parties agreed to arbitrate the dispute in question—consists of two distinct prongs: “(1) whether there is a valid agreement to arbitrate between the parties; and (2) whether the dispute in question falls within the scope of that arbitration agreement.” Tittle, 463 F.3d at 418-19 (quoting Webb, 89 F.3d at 258). “[I]n determining whether the parties agreed to arbitrate a certain matter, courts apply the contract law of the particular state that governs the agreement.” Washington Mut. Fin. Grp., LLC v. Bailey, 364 F.3d 260, 264 (5th Cir. 2004).3

III. ANALYSIS

A. Whether the FAA Applies

First, the Court considers whether the FAA applies here. Plaintiff asserts several theories as to why the FAA cannot apply: (1) the agreement does not involve a “contract evidencing a transaction involving commerce” as is required by the FAA, (2) Congress did not intend for the FAA to preempt States’ workers’ compensation schemes, and (3) the FAA as applied violates the Tenth Amendment. Below, the Court considers each of Plaintiff’s theories in turn and concludes that the FAA properly applies to Plaintiff’s claims.

1. The agreement involves a contract evidencing a transaction involving commerce.

According to the FAA § 2, the Act applies to “[a] written provision in any maritime transaction or a contract evidencing a transaction involving commerce.” 9 U.S.C. § 2 (emphasis added). Plaintiff contends that the employment contract at issue here should not be within the reach of the FAA because “while performing his duties ... Plaintiff was not ‘working in commerce, was not producing goods for commerce, and was not engaged in activity that affected commerce’ within the meaning of those terms as interpreted by the Supreme Court.” Resp. 12 (citing Bernhardt v. Polygraph Co. of America, 350 U.S. 198 (1956) ). Notwithstanding Plaintiff’s position, the Court determines that Plaintiff’s employment contract is clearly within the reach of the FAA.

*4 “Employment contracts, except for those covering workers engaged in transportation, are covered by the FAA.” E.E.O.C. v. Waffle House, Inc., 534 U.S. 279, 289 (2002). Further, in Circuit City, the Supreme Court rejected an argument that § 2 “extends only to commercial contracts.” Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 113 (2001). The Court reasoned that it applies an “expansive reading” to § 2 and, therefore, asserted that the FAA covers employment contracts, except those which § 1 expressly removes from its reach. Id. Notably, the plaintiff in Circuit City—like the Plaintiff here—was employed by a local store for a national retail chain, and the Supreme Court determined that his claims were within the FAA’s reach. Id. at 109.

Nonetheless, Plaintiff cites to a Supreme Court case from 1956—Bernhardt v. Polygraph Co. of America—and contends that its reasoning obliges the Court to find that Plaintiff’s claims do not fall within the FAA’s scope. Resp. 9–12. Specifically, Plaintiff highlights language from Bernhardt asserting that there was “no showing that petitioner while performing his duties under the employment contract was working ‘in’ commerce, was producing goods for commerce, or was engaging in activity that affected commerce, within the meaning of our decisions.” Id. at 12 (citing Bernhardt, 350 U.S. at 200–01). However, the Court remains unpersuaded by Plaintiff’s arguments regarding Bernhardt for two reasons. First, Plaintiff fails to account for more recent decisions—including the cases cited above—which expressly hold that employment contracts are within the FAA’s reach. Instead, Plaintiff simply ignores recent Supreme Court jurisprudence that is directly applicable to the case at hand. Second, Bernhardt’s reasoning contains very little discussion regarding the FAA. In fact, its analysis focuses on the application of the Erie doctrine—not on whether the employer was involved in interstate commerce pursuant to the FAA. See generally Bernhardt, 350 U.S. 198. Thus, Bernhardt appears to be unhelpful here.

For the reasons articulated above, the Court determines that Plaintiff’s employment contract is a “contract evidencing a transaction involving interstate commerce” within the meaning of the FAA.

2. The FAA applies to claims pursuant to Texas’s workers’ compensation scheme.

The FAA generally preempts any state laws that would frustrate the FAA’s purpose. See Concepcion, 563 U.S. at 343 (“Although § 2’s saving clause preserves generally applicable contract defenses, nothing in it suggests an intent to preserve state-law rules that stand as an obstacle to the accomplishment of the FAA’s objectives.”). Notwithstanding this general principle favoring preemption, Plaintiff contends that “Congress did not intend the [FAA] to eviscerate or preempt [the] State’s Workers’ compensation scheme” and that, therefore, the FAA should not apply here. Resp. 13.

However, Plaintiff’s contention is belied by the Texas Supreme Court’s interpretation of how the FAA and Texas workers’ compensation scheme interact. Specifically, the Texas Supreme Court has held that “an application of the FAA ... does not have the effect of eviscerating the workers’ compensation scheme in Texas.” Vista Quality Markets v. Lizalde, 438 S.W.3d 114, 122 (Tex. App. 2014). The Texas Supreme Court reasoned that “a party who agrees to arbitration does not forgo any substantive rights afforded to him by statute, but rather submits their resolution in an arbitral, rather than a judicial forum.” Id. Therefore, according to the Texas Supreme Court, the FAA does not prevent employees from effectively vindicating the rights afforded to them by the Texas Workers’ Compensation Act. Id.

*5 Because the Texas Supreme Court has determined that claims pursuant to the State workers’ compensation scheme are arbitrable, there appears to be no conflict between the state and federal law. However, even if there were a conflict, Supreme Court precedent suggests that the FAA generally preempts state laws. Thus, in step with both the United States Supreme Court and the Texas Supreme Court, the Court determines that arbitration agreements regarding workers’ compensation claims may be enforced.4

3. The FAA as applied does not violate the Tenth Amendment.

Additionally, Plaintiff argues that the FAA “as applied would violate the Tenth Amendment.” Resp. 17. Again, Plaintiff’s argument is contrary to the Texas Supreme Court’s decision on this issue. The Texas Supreme Court has rejected this argument and held that “the FAA does not violate the Tenth Amendment by encroaching on a state power to enact and regulate its workers’ compensation system.” Vista Quality Markets, 438 S.W.3d at 122. The Texas Supreme Court stated:

We have recognized that a state has a Tenth Amendment power to enact and regulate its own workers’ compensation system, protecting workers’ claims against employers.... However, we have also held that statutory claims under the Texas Workers’ Compensation Act are arbitrable.... Thus, we conclude that compliance with the Federal Arbitration Act would not directly impair Texas’s ability to structure integral operations in areas of traditional government functions....

In re Odyssey Healthcare, Inc., 310 S.W.3d 419, 423–24 (Tex. 2010) (internal citations and alterations omitted). Accordingly, the Court concludes that requiring arbitration in this case does not violate the Tenth Amendment.

B. Whether the Agreement to Arbitrate is Valid

Having determined that the FAA is applicable here, the Court analyzes whether the parties agreed to arbitrate their claims. Defendant asserts that a valid arbitration agreement exists. According to Plaintiff, there is no legally enforceable agreement because “[t]he arbitration provisions fails [sic] for lack of consideration and/or is illusory.” Resp. 4. Thus, Plaintiff believes the agreement is invalid based on principles of contract law. Below, the Court considers Plaintiff’s arguments and determines that the agreement to arbitrate is not illusory and does not lack sufficient consideration.

1. The agreement to arbitrate is not illusory.

According to Plaintiff, Defendant “can amend or terminate the [ ] plan at any time,” and therefore the plan is illusory and unenforceable. Resp. 7. However, in Texas, an agreement is illusory if a party “possesses the right to modify or terminate an arbitration agreement without notice.Zamora, 547 F. Supp. 2d at 702 (emphasis added). Texas law allows unilateral modifications to or termination of an agreement where: (1) the modification or termination is limited only to prospective, unknown claims and (2) the employer gives notice to the employees of the modification or termination. J.M. Davidson, Inc. v. Webster, 128 S.W.3d 223, 228 (Tex. 2003) (citing In re Halliburton Co., 80 S.W.3d 566, 570–71 (Tex. 2002) ).

*6 Here, Defendant’s policy provides that “no [ ] amendment or termination shall alter the arbitration requirements of this Policy with respect to any injury occurring prior to the date of such an amendment or termination.” Mot. Ex. B (Summary Plan Description) App. A p. 7. The policy further provides that, “any such amendment or termination of this policy shall not be effective until at least 14 days after written notice has been provided.” Id. Thus, the Agreement conforms to Texas law requiring that employers provide notice of any unilateral amendments to or termination of an arbitration agreement, and that all amendments only apply prospectively. Accordingly, Plaintiff’s argument that the agreement is illusory fails.

2. The agreement to arbitrate does not lack consideration.

According to Plaintiff, the agreement lacks consideration because “by its plain and express language, [Defendant’s] policy is a stand-alone agreement” and “the only valid consideration that may support a stand-alone arbitration agreement are the parties’ mutual promises to arbitrate each party’s potential claims.” Resp. 5 (emphasis omitted) (citing Mendivil v. Zanios Foods, Inc., 357 S.W.3d 827, 832 (Tex. App. 2012) ). Plaintiff’s assertion misrepresents Defendant’s policy. In fact, Defendant’s policy specifically provides for the mutuality of the arbitration agreement and “is equally binding upon” the employer and employee. Id. Ex. B (Summary Plan Description) App. A p. 7. Thus, mutual promises to arbitrate claims exist, and the agreement does not fail for a lack of consideration.

In conclusion, because the agreement is not illusory and contains valid consideration, the Court is unpersuaded by Plaintiff’s arguments that the agreement to arbitrate is invalid. Further, because the arbitration policy states that claims related to an on-the-job injury must be submitted to the arbitrator, Plaintiff’s claims are plainly in the scope of the agreement. Accordingly, the Court is of the opinion that the parties agreed to arbitrate the dispute in question.

C. Whether this Case Should be Stayed or Dismissed

In its Motion, Defendant seeks a stay of this case pending arbitration. Although Defendant does not seek dismissal, the Court sua sponte considers whether a stay or dismissal is appropriate. According to the Fifth Circuit, § 3 of the FAA “was not intended to limit dismissal of a case in the proper circumstances. The weight of authority clearly supports dismissal of the case when all of the issues raised in the district court must be submitted to arbitration.” Alford v. Dean Witter Reynolds, Inc., 975 F.2d 1161, 1164 (5th Cir. 1992) (emphasis omitted). Thus, if all of a plaintiff’s claims must be submitted to arbitration, the district court may stay or dismiss the case. Finding no reason to keep this case pending on the Court’s docket until arbitration is complete, the Court determines that the case should be dismissed.

IV. CONCLUSION

The Court concludes that the FAA applies to this case. Further, the parties entered into a valid agreement to arbitrate claims related to an on-the-job injury. Accordingly, the Court concludes that Plaintiff’s claims must be resolved via binding arbitration and that this case should be dismissed.

Accordingly, IT IS ORDERED that Defendant Wal-Mart Associates, Inc.’s “Brief in Support of Demand for Arbitration” (ECF No. 25) is GRANTED.

IT IS FURTHER ORDERED that the above-captioned cause is DISMISSED.

IT IS FURTHER ORDERED that Plaintiff Ruben Mendez’s claims against Defendant Wal-Mart Associates, Inc.’s claims must be submitted to ARBITRATION.

IT IS FURTHER ORDERED that all settings in this matter are VACATED.

IT IS FURTHER ORDERED that all pending motions, if any, are DENIED AS MOOT.

*7 IT IS FINALLY ORDERED that the Clerk shall CLOSE this case.

Footnotes

1

Plaintiff’s Response is longer than the page limit set by the local rules. The Fifth Circuit has not yet ruled on whether motions to compel arbitration are dispositive or nondispositive. DHI Grp., Inc. v. Kent, No. CV H-16-1670, 2018 WL 1150213, at *1 (S.D. Tex. Mar. 5, 2018). In Plaintiff’s “Unopposed Motion to Extend Time by Seven (7) Days to File Response ...” (ECF No. 26) [hereinafter “Motion to Extend Time”], filed on November 5, 2018, he seems to anticipate that this would be treated as a nondispositive motion, as Plaintiff assumed that the relevant deadline was seven days after Defendant’s Motion, which reflects the deadline for nondispositive motions. See Mot. to Extend Time. Thus, it appears that Plaintiff’s Response should have been limited to ten pages. Local Rule CV-7(e). Notably, even if this is properly considered a dispositive motion, Plaintiff’s Response would be limited to twenty pages. Id. However, Plaintiff’s Response is twenty-five pages; therefore, he exceeds the page limit by either standard. In advance of filing his Response, Plaintiff sought an extension of time for his response—which the Court granted—but did not seek leave to file a motion in excess of the page limit. See generally Mot. to Extend Time. Inexplicably, it also appears that Plaintiff switches from 12 point font—the smallest font size allowed by the local rules—to a smaller, 10 point font (with his footnotes in even smaller font), in violation of Local Rule CV-10. See, e.g., Resp. ¶¶ 22–23 (shrinking font size). Further, the Court recognizes that Defendant managed to reply to Plaintiff’s arguments in five pages, the limit for reply briefings regarding nondispositive motions. See Local Rule CV-7(f). In future cases, Plaintiff’s counsel would be well advised follow the local rules more carefully.

2

Wal-Mart is a “nonsubscribing employer.” A nonsubscribing employer is one that is not covered by workers’ compensation insurance obtained in a manner authorized by Texas Labor Code § 406.003. An employer covered by workers’ compensation is subject to limited liability for death and injury sustained by an employee in the course and scope of employment without regard to whether the employer acted negligently. A nonsubscribing employer is subject to unlimited liability for death and injury sustained by an employee in the course and scope of employment, but only where the employer acted negligently.

3

As both parties rely on Texas law in their briefing, the Court will apply Texas law. Zamora v. Swift Transp. Corp., 547 F. Supp. 2d 699, 702 (W.D. Tex. 2008), aff’d, 319 F. App’x 333 (5th Cir. 2009).

4

The Court also notes that it previously determined that Plaintiff’s claim should not be understood as a claim pursuant to Texas’s workers’ compensation scheme. Rather, Plaintiff’s claim derives from the common law. Defendant is a nonsubscribing employer. As the Court previously discussed in its “Order Denying Plaintiff’s Motion to Remand” (ECF No. 23), filed on September 10, 2018, the Fifth Circuit and Texas Supreme Court have suggested that claims against nonsubscribing employers are derived from common law rather than the Texas Workers’ Compensation Act, albeit in different contexts. Order Denying Pl.’s Mot. to Remand 8 (citing Am. Int’l Specialty Lines Ins. Co. v. Rentech Steel LLC, 620 F. 3d 558, 564 (5th Cir. 2010) ). Thus, even if the FAA did not apply to claims pursuant to State workers’ compensation schemes, the Court determines that the FAA could still apply to Plaintiff’s claim because his claim is brought pursuant to the common law.

United States District Court, W.D. Texas, Midland-Odessa Division,

Midland/Odessa Division.

Sharon Kay DICKENS, Plaintiff,

v.

TASB RISK MANAGEMENT & Orlando Riddick, Self-Insured, Defendants,

MO:17-CV-00216-DC

|

Signed 11/21/2018

Attorneys & Firms

Sharon Kay Dickens, Midland, TX, pro se.

ORDER DISMISSING CASE FOR LACK OF SUBJECT MATTER JURISDICTION

DAVID COUNTS, UNITED STATES DISTRICT JUDGE

*1 On this day, the Court sua sponte considered its subject matter jurisdiction in the above-captioned cause. For the reasons explained below, the Court finds that subject matter jurisdiction is lacking and hereby DISMISSES WITHOUT PREJUDICE Plaintiff’s remaining claims against Defendant Orlando Riddick. Further, the Court DISMISSES as MOOT Plaintiff’s claims against Defendant TASB Risk Management.

I. BACKGROUND

On April 20, 2018, Plaintiff Sharon Kay Dickens, proceeding pro se, filed an amended complaint against Defendants without adopting any of the claims raised in her original complaint.1 (Doc. 11). In her amended complaint, Plaintiff argued that on August 21, 2015, she had an accident at work. Id. at 6. Additionally, she alleged that at the time of the accident she was covered by a workers’ compensation insurance policy issued by Defendant Midland ISD. Id. Plaintiff requested that the Court “oversee and grant benefits, medical and financial, according to guidelines for mind and body healing.” Id. at 4. On May 8, 2018, Defendant Midland ISD filed a Motion to Dismiss alleging the Court lacked subject matter jurisdiction and, alternatively, that Plaintiff had not exhausted her administrative remedies. (Doc. 13). Plaintiff did not respond. On October 12, 2018, the Court granted Defendant’s Motion on the basis that the Court lacked subject matter jurisdiction over Plaintiff’s claim for workers’ compensation. (Doc. 14).

II. LEGAL STANDARD

Federal courts have limited jurisdiction. Peoples Nat’l Bank v. Office of the Comptroller of the Currency of the United States, 362 F.3d 333, 336 (5th Cir. 2004). The question of subject-matter jurisdiction may be raised not only by the parties, but also by the court sua sponte, and if a federal court perceives at any stage of the proceedings that it lacks subject-matter jurisdiction, it must take proper notice of the defect by dismissing the action. See Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006) (holding that when a federal court concludes that it lacks subject-matter jurisdiction, the court must dismiss the complaint in its entirety). A district court can dismiss an action sua sponte for lack of federal subject-matter jurisdiction, therefore, even where the defendant makes no responsive pleadings and does not move to dismiss for want of subject-matter jurisdiction. 61A Am. Jur. 2d Pleading § 407; see also Howard v. Lemmons, 547 F.2d 290 (5th Cir. 1977). Finally, federal courts must address jurisdictional questions whenever they are raised and must consider jurisdiction sua sponte if not raised by parties. Rutherford v. Breathwite Marine Contractors, Ltd., 59 F. Supp. 3d 809 (S.D. Tex. 2014).

III. DISCUSSION

*2 As detailed in its previous Order, this Court does not have subject matter jurisdiction over Plaintiff’s workers’ compensation claim against Defendant Midland ISD as such claim arises under the Texas Workers’ Compensation Act. (Doc. 14). A federal court has subject matter jurisdiction over a case if there is a federal question or if the parties are completely diverse and meet the amount in controversy. 28 U.S.C. §§ 1331–32. The Court has federal question jurisdiction if the cause of action arises under federal law. Id. at § 1331. Here, Plaintiff’s claim against both Defendant Midland ISD and Defendant Riddick arises from state law, not federal law. (Doc. 11). Further, Plaintiff does not allege diversity exists between the parties and, even if Plaintiff did, Defendant Riddick appears to be a resident of Texas. (Doc. 11 at 1, 3). Accordingly, for the same reason the Court dismissed Plaintiff’s claim against Defendant Midland ISD, the Court finds that Plaintiff’s workers’ compensation claim against Defendant Riddick must also fail. Crawford v. Creative Risk Sols., CV H-17-1130, 2017 WL 6761823, at *1 (S.D. Tex. Oct. 5, 2017) (holding the workers’ compensation claim was “within the exclusive jurisdiction of the Texas Workers’ Compensation Division” and dismissing plaintiff’s claim).

IV. CONCLUSION

For the foregoing reasons, the Court DISMISSES WITHOUT PREJUDICE Plaintiff’s remaining claim against Defendant Riddick and DISMISSES as MOOT Plaintiff’s claims under Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act against Defendant TASB Risk Management.

Accordingly, the Court ORDERS that Plaintiff’s workers’ compensation claim under the Texas Workers’ Compensation Act against Defendant Riddick is DISMISSED WITHOUT PREJUDICE.

The Court further ORDERS that Plaintiff’s Title VII and ADEA claims against Defendant TASB Risk Management are DISMISSED as MOOT.

It is so ORDERED.

Footnotes

1

In its original complaint Plaintiff asserted claims under Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e, et seq. and under the Age Discrimination in Employment Act, 29 U.S.C. §§ 12102 et seq. against Defendants Midland ISD and TASB Risk Management. (Doc. 10). As noted above, in her amended complaint, Plaintiff did not adopt or incorporate any of the claims raised in her original complaint and only asserted a workers’ compensation cause of action against Defendant Midland ISD, not Defendant TASB, and added Defendant Orlando Riddick. (Compare Doc. 10, with Doc. 11). Because Plaintiff’s amended complaint superseded her original complaint, rendering the original complaint raising Title VII and age discrimination causes of action “of no legal effect,” Plaintiff’s claims against Defendant TASB are dismissed as moot. King v. Dogan, 31 F.3d 344, 346 (5th Cir. 1994) (noting that unless an amended complaint “refers to and adopts or incorporates by reference the earlier pleading,” the earlier pleading has no legal effect); Thompson v. Eason, 258 F. Supp. 2d 508, 511 (N.D. Tex. 2003) (citing Eason v. Holt, 73 F.3d 600, 603 (5th Cir. 1996) ) (dismissing six Defendants because they were not named in the amended complaint).

United States District Court, W.D. Texas, Midland-Odessa Division,

Midland/Odessa Division.

Sharon Kay DICKENS, Plaintiff,

v.

MIDLAND ISD, TASB Risk Management & Orlando Riddick, Self-Insured, Defendants.

MO:17-CV-00216-DC

|

Signed 10/12/2018

Attorneys & Firms

Sharon Kay Dickens, Midland, TX, pro se.

ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS

DAVID COUNTS, UNITED STATES DISTRICT JUDGE

*1 BEFORE THE COURT is Defendant Midland ISD’s Motion to Dismiss. (Doc. 13). Plaintiff did not file a Response. After due consideration, the Court GRANTS Defendant’s Motion to Dismiss. Id.

I. BACKGROUND

In her original complaint filed on February 28, 2018, Plaintiff Sharon Kay Dickens, proceeding pro se, raised claims under Title VII of the Civil Rights Act of 1964 and the Age Discrimination in Employment Act against Midland ISD and TASB Risk Management. (Doc. 10 at 1). Plaintiff filed an amended complaint against Defendant Midland ISD and Defendant Orlando Riddick, Midland ISD Superintendent, on April 20, 2018. (Doc. 11). However, Plaintiff did not adopt or incorporate any of the claims raised in her original complaint. Id. In her amended complaint, Plaintiff argues that on August 21, 2015, Plaintiff sustained an injury while sitting on a rolling chair that became caught on the edge of a rolling mat, causing the chair to roll out from under Plaintiff. Id. at 6. Plaintiff asserts that when the chair rolled out from under her, she fell to the floor, injuring her lower back and hips. Id. At the time of the injury, Plaintiff alleges she was covered by a workers’ compensation insurance policy issued by Defendant Midland ISD. Id. Plaintiff asks that the Court “oversee and grant benefits, medical and financial, according to guidelines for mind and body healing.” Id. at 4.

On May 8, 2018, Defendant Midland ISD filed the instant Motion to Dismiss under Federal Rule of Civil Procedure 12(b)(1) and 12(b)(6). (Doc. 13). Defendant argues that the Court lacks subject matter jurisdiction over Plaintiff’s claims pursuant to Texas Labor Code section 410.252(b)(1). Id. Further, Defendant argues that Plaintiff has not “exhausted her administrative remedies and that the suit was not timely filed.” Id. at 5. Plaintiff did not file a Response.

II. LEGAL STANDARDS

“When a 12(b)(1) motion is filed in conjunction with other Rule 12 motions, the court should consider the Rule 12(b)(1) jurisdictional attack before addressing any attack on the merits.” Ramming v. United States, 281 F.3d 158, 161 (5th Cir. 2001). This prevents courts from prematurely dismissing a case with prejudice when they do not have the necessary jurisdiction. Id. The Court must dismiss any claim for lack of subject matter jurisdiction when it lacks the statutory or Constitutional authority to decide the case. See Home Builders Assn. of Mississippi, Inc. v. City of Madison, 143 F.3d 1006, 1010 (5th Cir. 1998).

III. DISCUSSION

Defendant Midland ISD makes the general argument that Plaintiff filed her complaint arising under the Texas Workers’ Compensation Act in the wrong court and urges the Court to dismiss Plaintiff’s complaint for lack of subject matter jurisdiction. (Doc. 13 at 5). The Court notes that Plaintiff’s amended complaint superseded her original complaint, rendering the original complaint raising Title VII and age discrimination issues “of no legal effect.” King v. Dogan, 31 F.3d 344, 346 (5th Cir. 1994) (noting that unless an amended complaint “refers to and adopts or incorporates by reference the earlier pleading,” the earlier pleading has no legal effect). Accordingly, only Plaintiff’s cause of action under the Texas Workers’ Compensation Act against Defendants Midland ISD and Orlando Riddick remain. (Doc. 11).

*2 Federal courts have subject matter jurisdiction over a case if there is a federal question or if the parties are completely diverse and meet the amount in controversy. 28 U.S.C. §§ 1331–32. In order for a federal court to have federal question jurisdiction over a case, the cause of action must arise under federal law. Id. at § 1331. In the instant case, Plaintiff does not claim that the parties are diverse nor does she claim that the requisite amount in controversy is met.1 (Doc. 11). Rather, Plaintiff asserts that her claim raises a federal question. Id. at 4. However, Plaintiff’s cause of action seeking temporary income benefits and the reversal of an adverse ruling arises under the Texas Workers’ Compensation Act and not federal law. Id. Accordingly, the court lacks federal question jurisdiction. Crawford v. Creative Risk Sols., CV H-17-1130, 2017 WL 6761823, at *1 (S.D. Tex. Oct. 5, 2017) (finding the court lacked subject matter jurisdiction over the plaintiff’s workers’ compensation claim because such complaint fell “within the exclusive jurisdiction of the Texas Workers’ Compensation Division” (citing In re Crawford & Co., 458 S.W.3d 920, 925-26 (Tex. 2015) ) ); Rubell v. Gen. Dynamics Corp., 7:10-CV-00176-O, 2011 WL 477175, at *1 (N.D. Tex. Jan. 20, 2011) (noting that a federal court has subject matter jurisdiction over a workers’ compensation case “so long as complete diversity and the requisite amount in controversy are established”).

In the absence of diversity jurisdiction and the Plaintiff’s exhaustion of her state administrative remedies, Plaintiff’s workers’ compensation claim cannot be pursued in federal court. Accordingly, the Court holds that it does not have subject matter jurisdiction over Plaintiff’s claim.

IV. CONCLUSION

For the above-mentioned reasons, the Court GRANTS Defendant’s Motion to Dismiss, and DISMISSES Plaintiff’s Amended Complaint WITHOUT PREJUDICE.

It is so ORDERED.

Footnotes

1

The Court notes that even if Plaintiff argued that diversity jurisdiction exists, that argument would fail because Plaintiff was a resident of Texas at the time she filed her cause of action and Defendant Midland ISD is incorporated in Texas. (Doc. 11 at 1, 3). Further, Defendant Orlando Riddick appears to be a resident of Texas. Id.

United States District Court, W.D. Texas, Pecos Division.

Johnny SILVAS, Plaintiff,

v.

Darrell HARRIE & RLG International, Inc., Defendants.

P:17-CV-00034-DC

|

Signed 10/04/2018

Attorneys & Firms

Spencer W. Dobbs, The Dobbs Law Firm, Odessa, TX, for Plaintiff.

Dick R. Holland, Shafer Davis O’Leary & Stoker, Inc., Odessa, TX, for Defendants.

ORDER ADOPTING REPORT & RECOMMENDATION

DAVID COUNTS, UNITED STATES DISTRICT JUDGE

*1 BEFORE THE COURT is the Report and Recommendation (R&R) by the United States Magistrate Judge David B. Fannin, recommending that the Court (1) grant Defendants’ Motion for Summary Judgment and (2) deny Plaintiff’s Motion for Partial Summary Judgment. (Doc. 24). On September 10, 2018, Plaintiff filed his objections to the R&R. (Doc. 29). On September 20, 2018, Defendants filed a Response to Plaintiff’s Objection to the R&R. (Doc. 33). After due consideration, the Court ADOPTS the R&R of the United States Magistrate Judge filed August 28, 2018 (Doc. 24), GRANTS Defendants’ Motion for Summary Judgment (Doc. 21), and DENIES Plaintiff’s Motion for Partial Summary Judgment (Doc. 22).

I. BACKGROUND

On July 24, 2017, Plaintiff filed this lawsuit against Defendant Darrell Harrie (Harrie) alleging Harrie operated his vehicle in a negligent manner, striking and injuring Plaintiff. (Doc. 1 at 2–3). On January 4, 2018, Plaintiff amended his complaint to add RLG International, Inc. (RLG), Harrie’s employer, as a Defendant in the lawsuit, asserting Harrie was “operating his motor vehicle in the course and scope of his employment” with RLG. (Doc. 7 at 1, 3). On April 9, 2018, Plaintiff filed a second amended complaint asserting a negligence claim against Harrie, respondeat superior, negligent entrustment, and negligent hiring, supervision, training, and retention claims against RLG, and an exemplary damages claim against both Defendants. (Doc. 12 at 3–6).

Defendants filed their Motion for Summary Judgment on July 27, 2018, seeking summary judgment on the respondeat superior, negligent entrustment, and negligent hiring, supervision, training, and retention claims against RLG, as well as the exemplary damages claim against both Defendants. (Doc. 21). Plaintiff did not file a response to Defendants’ motion. Rather, on July 30, 2018, Plaintiff filed a Motion for Partial Summary Judgment, seeking summary judgment on his respondeat superior claim against RLG. (Doc. 22). Defendants did not file a response to Plaintiff’s Motion. On August 28, 2018, United States Magistrate Judge David B. Fannin issued the instant R&R, granting Defendants’ Motion for Summary Judgment and denying Plaintiff’s Motion for Partial Summary Judgment. (Doc. 24). On September 10, 2018, Plaintiff filed its Objection to the R&R. (Doc. 29). Defendants filed a Response to Plaintiff’s Objection on September 20, 2018. (Doc. 33).

II. LEGAL STANDARDS

A. Review of a Magistrate Judge’s Report & Recommendation

A party may contest a report and recommendation by filing written objections within fourteen (14) days of being served with a copy of the report and recommendation. See 28 U.S.C. § 636(b)(1). A party’s objections to an R&R entitle it to a de novo review of those claims by a District Court. See 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b)(3). However, objections must specifically identify those findings or recommendations to which the party objects. Fed. R. Civ. P. 72(b)(2). The district court need not consider frivolous, conclusive, or general objections. See Battle v. U.S. Parole Comm’n, 834 F.2d 419, 421 (5th Cir. 1987).

*2 In this case, Plaintiff filed objections to the Magistrate Judge’s R&R on September 10, 2018. (Doc. 29). Specifically, Plaintiff objects the Magistrate Judge’s findings that: (1) Harrie was not in the scope and course of his employment at the time of the accident and (2) Harrie did not act with gross negligence. Id. De novo review by this Court was, therefore, triggered as to these objections alone. See 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b)(3).

The remainder of the R&R is reviewed for clear error. 28 U.S.C. § 636(b)(1)(C). After due consideration, the Court is of the opinion that the remaining portions of the Magistrate Judge’s R&R, to which neither side objected, are neither clearly erroneous nor contrary to law. Id. Accordingly, the Court adopts the remainder of the R&R. Id.

B. Motions for Summary Judgment

Federal courts sitting in diversity apply state substantive law and federal procedural law. Shady Grove Orthopedic Assocs., P.A. v. Allstate Ins. Co., 559 U.S. 393, 437 (2010) (citing Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 427 (1996) ). Summary judgment is proper if there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). A genuine issue of material fact exists “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The Court must examine “whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.” Id. at 251–52. In making this determination, the Court must consider the record as a whole by reviewing all pleadings, depositions, affidavits, and admissions on file, and drawing all justifiable inferences in favor of the nonmoving party. Caboni v. Gen. Motors Corp., 278 F.3d 448, 451 (5th Cir. 2002). The Court may not weigh the evidence, or evaluate the credibility of witnesses. Id.

The moving party bears the initial burden of showing the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party demonstrates an absence of evidence supporting the nonmoving party’s case, then the burden shifts to the nonmoving party to come forward with specific facts showing that a genuine issue for trial exists. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). To sustain this burden, the nonmoving party cannot rest on the mere allegations of the pleadings. Fed. R. Civ. P. 56(e); Anderson, 477 U.S. at 248. “After the nonmovant has been given an opportunity to raise a genuine factual issue, if no reasonable juror could find for the non-movant, summary judgment will be granted.” Caboni, 278 F.3d at 451. “Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Anderson, 477 U.S. at 248. The admissibility of summary judgment evidence is subject to the same rules of admissibility applicable to a trial. Resolution Tr. Corp. v. Starkey, 41 F.3d 1018, 1024 (5th Cir. 1995) (citing Munoz v. Int’l All. of Theatrical Stage Emps. etc., 563 F.2d 205, 297 n.1 (5th Cir. 1977) ).

III. DISCUSSION

A. Objection to the Recommended Disposition of the Parties’ Cross-Motions for Summary Judgment on the Respondeat Superior Claim

*3 In Texas, the common-law doctrine of respondeat superior imputes liability on an employer for its employee’s negligence based solely on their relationship as employer and employee. Painter v. Amerimex Drilling I, Ltd., No. 16-0120, 2018 WL 2749862, at *3 (Tex. Apr. 13, 2018). The plaintiff must generally prove that “the worker (1) was an employee and (2) was acting in the course and scope of his employment.” Id. (citing Goodyear Tire & Rubber, Co. v. Mayes, 263 S.W.3d 754, 757 (Tex. 2007); Limestone Prods. Distrib., Inc. v. McNamara, 71 S.W.3d 308, 311 (Tex. 2002) ). “The course-and-scope inquiry under step two involves an objective analysis, hinging on whether the employee was performing the tasks generally assigned to him in furtherance of the employer’s business. That is, the employee must be acting with the employer’s authority and for the employer’s benefit.” Painter, 2018 WL 2749862, at *10.

In the vicarious liability context, pursuant to the coming-and-going rule, “an employee is generally not acting within the scope of his employment when traveling to and from work.” Id. However, Texas courts recognize several exceptions. One exception applies “when such travel involves the performance of regular or specifically assigned duties for the benefit of the employer.” Id. Texas courts also recognize that a rebuttable presumption arises that a driver is in the scope of his employment when the accident occurred if “it is proved that the [vehicle] was owned by the defendant and that the driver was in the employment of defendant.” Robertson Tank Lines, Inc. v. Van Cleave, 468 S.W.2d 354, 357 (Tex. 1971). This rule has been expanded by some courts to include transportation “furnished or paid for by the employer.” Askew v. Mathews, No. 01-90-00488-CV, 1991 WL 188711, at *7 (Tex. App.—Houston [1st Dist.] Sept. 26, 1991, no writ). The rationale is that when the vehicle is furnished or paid for by an employer and an employee is driving the vehicle, there is an assumption that the employee was engaged in the employer’s business. Van Cleave, 468 S.W.2d at 358.

Plaintiff makes two arguments regarding the Magistrate Judge’s finding that Harrie was not in the scope and course of his employment with RLG when the accident occurred. (Doc. 29 at 5–6). First, Plaintiff argues that the coming-and-going rule excludes employees from the course and scope of employment when they are traveling to and from work but that in this case, the exception for employers who pay for their employee’s transportation applies. Id. at 5. Second, Plaintiff argues that the continuous coverage rule applies to the facts of this case because Harrie was a traveling employee. Id. at 6.

1. Exceptions to the Coming-and-Going Rule

Plaintiff points out that Harrie was hired as a traveling employee to provide consultant services to RLG’s clients, that RLG reimbursed Harrie for travel expenses, and that at the time of the accident Harrie was traveling from his temporary job site to the hotel he was staying at while providing consultant services. (Doc. 29 at 5–7). Thus, because RLG furnished or paid for Harrie’s transportation, the coming-and-going rule is not applicable. Id. at 5. Rather, there is a rebuttable presumption that Harrie was acting in the course and scope of his employment with RLG at the time of the accident. Id. Further, Plaintiff argues that RLG did not meet its burden of proving that Harrie was outside the course and scope of employment. Id.

The Magistrate Judge considered various exceptions to the coming-and-going rule and found the Court should nevertheless adhere to the general rule of non-liability for employers when their employee is traveling to and from work. (Doc. 24 at 8). This Court agrees. Texas courts have held that an employer is not liable even when it furnishes or pays for its employee’s transportation or reimburses its employee for travel expenses absent evidence that the employer controlled or directed how the employee traveled. See Pilgrim v. Fortune Drilling Co., Inc., 653 F.2d 1981, 987–88 (5th Cir. 1981) (“Under Texas law ‘an employee is not acting within the scope of his employment while going to and from work, even though he uses his employer’s vehicle as the means of transportation.’ ” (quoting Salmon v. Hinojosa, 538 S.W.2d 22, 24 (Tex. Civ. App.—San Antonio 1976, no writ) ) ); American Nat’l Ins. Co. v. O’Neal, 107 S.W.2d 927 (Tex. Civ. App. San Antonio 1937, no writ) (refusing to hold an employer liable for its employee’s negligence even when the employer paid traveling expenses and there was no evidence that the employer provided any direction on how the employee should travel). Here, even though RLG reimbursed Harrie for his travel expenses, RLG did not direct or control how Harrie traveled. Additionally, Texas courts have extended the general rule that an employee is not in the course and scope of employment while traveling in his own vehicle to and from work and applied it “to employees traveling to and from a temporary job site, even when the employer has provided mileage reimbursement for the travel.” Farrell v. Commercial Structures & Interiors, Inc., No. 05-02-00031-CV, 2002 WL 31411022, at *1 (Tex. App.—Dallas Oct. 28, 2002, no pet.) (citing Smith v. Universal Elec. Const. Co., 30 S.W.3d 435, 438 (Tex. App.—Tyler 2000, no pet.); London v. Texas Power & Light Co., 620 S.W.2d 718, 720 (Tex. Civ. App.—Dallas 1981, no writ) ) ).

*4 Further, in its Motion for Summary Judgment, RLG presented evidence sufficient to rebut any indication that Harrie was acting within the scope and course of his employment. RLG presented evidence that Harrie “had completed his work for the day,” was driving from the job site “to his hotel in Midland,” “was not required to stay at any particular hotel or travel any particular route,” and that no aspect of Harrie’s drive from the job site to his hotel “furthered RLG’s leadership coaching business.” (Doc. 21 at 4). Nothing in the record before the Court indicates that Harrie was fulfilling any function for RLG or acting within the scope of his employment when he drove to his hotel after concluding his day’s work. Therefore, the Court rejects Plaintiff’s arguments that the Magistrate Judge erred in concluding that the coming-and-going rule applied in this case to bar Plaintiff’s respondeat superior claim against RLG.

2. The Applicability of the Continuous Coverage Rule

Plaintiff also argues that the continuous coverage rule applies to the facts of this case because Harrie was a traveling employee at the time he was driving from his temporary job site to his hotel. (Doc. 29 at 6). Plaintiff cites five cases detailing the application of the continuous coverage rule; however, in all five cases, the plaintiffs seek workers’ compensation benefits. Id.; see generally Shelton v. Standard Ins. Co., 389 S.W.2d 290 (Tex. 1965); Zurich Am. Ins. Co. v. McVey, 339 S.W.3d 724 (Tex. App.––Austin 2011, pet. denied); Rose v. Odiorne, 795 S.W.2d 210 (Tex. App.—Austin 1990, writ denied); N. River Ins. Co. v. Purdy, 733 S.W.2d 630 (Tex. App.––San Antonio 1987, no writ); Hardware Mut. Cas. Co. v. McDonald, 502 S.W.2d 602 (Tex. App.––San Antonio 1973, writ ref’d n.r.e.). Plaintiff alleges that said cases are applicable in this case because the Fifth Circuit has in many instances applied workers’ compensation case law to determine whether a worker was acting within the course and scope of his employment. (Doc. 29 at 5–6). Plaintiff, however, fails to cite any authority indicating that the Fifth Circuit or Texas courts have applied workers’ compensation case law to determine whether a worker was acting within the course and scope of his employment in the vicarious liability context. Id.

Additionally, Plaintiff states that in the “Worker’s Comp context it is also the settled law that ‘for an employee’s injury to be considered sustained ‘in the course and scope of employment,’ it must (1) relate to or originate in the employer’s business, and (2) occur in the furtherance of the employer’s business.’ ” Id. (emphasis added). However, Plaintiff fails to cite case law evidencing that the two-part test is applied in the vicarious liability context. Id. In the vicarious liability context, an employee acts within the scope and course of employment if his action or omission “is in furtherance of employer’s business and for the accomplishment of the object for which the employee is employed.” Leadon v. Kimbrough Bros. Lumber Co., 484 S.W.2d 567, 569 (Tex. 1972). Clearly, the test in the workers’ compensation context differs from that applicable in the vicarious liability context.

It should be noted that workers’ compensation law is a no-fault system. Texas Mut. Ins. Co. v. Ruttiger, 381 S.W.3d 430, 441 (Tex. 2012) (explaining that the Texas Workers’ Compensation Act “saves the time and litigation expenses inherent in proving fault in a common law tort claim” (citing HCBeck, Ltd. v. Rice, 284 S.W.3d 349, 349 (Tex. 2009) ) ). The Workers’ Compensation Act is “liberally construed in favor of the injured employee, to afford to the worker the relief intended under the Act and to effectuate the beneficial purposes of the litigation.” Nat’l Farmers Union Prop. & Cas. Co. v. Degollado, 844 S.W.2d 892, 896 (Tex. App.—Austin 1992, writ denied) (citing Miears v. Indust. Accident Bd., 232 S.W.2d 671, 675 (Tex. 1950) ). Although workers’ compensation principles may provide guidance in vicarious liability cases, those principals should not be applied mechanically. Echols v. Gardiner, No. H-11-0882, 2013 WL 6243736, at *21 (S.D. Tex. Dec. 3, 2013), aff’d in part, dismissed in part, 593 Fed. Appx. 404 (5th Cir. 2015) (refusing to apply a proposition because it was developed for claims brought under the Texas Workers Compensation Act and “not vicarious liability for claims sounding in tort”). In fact, the Supreme Court of Texas has highlighted the different goals of the common-law and the Texas Workers’ Compensation Act. Garza v. Exel Logistics, Inc., 161 S.W.3d 473, 481 (Tex. 2005) (“The common-law principles that define when there will be vicarious liability are designed to assign liability for injury to third parties to the party who was directing the details of the negligent actor’s conduct when that negligence occurred. The Workers’ Compensation Act was not.” (citing Wingfoot Enters. v. Alvarado, 111 S.W.3d 134, 146 (Tex. 2003) ) ). This Court will not assume that Texas courts would use their understanding of “scope and course of employment” from the realm of workers’ compensation to that of vicarious liability, given the divergent rationales for the “scope and course of employment” determination in each context and what such determination accomplishes.

*5 Therefore, the Court rejects Plaintiff’s arguments that the continuous coverage rule, which has only been applied in workers’ compensation cases, applies in this case.

B. Objection to Recommended Disposition of Plaintiff’s Claim for Exemplary Damages

“[E]xemplary damages may be awarded only if the claimant proves by clear and convincing evidence that the harm with respect to which the claimant seeks recovery of exemplary damages results from: (1) fraud; (2) malice; or (3) gross negligence.” Tex. Civ. Prac. & Rem. Code Ann. § 41.003 (West). Plaintiff agrees that Harrie did not act with malice or fraudulently. (Doc. 29 at 8). Rather, Plaintiff argues that Harrie acted with gross negligence. Id. The Texas Civil Practice & Remedies Code defines gross negligence as “an act or omission:

(A) which when viewed objectively from the standpoint of the actor at the time of its occurrence involves an extreme degree of risk, considering the probability and magnitude of the potential harm to others; and

(B) of which the actor has actual, subjective awareness of the risk involved, but nevertheless proceeds with conscious indifference to the rights, safety, or welfare of others.”

Tex. Civ. Prac. & Rem. Code Ann. § 41.001(11) (West). “An act or omission that is merely thoughtless, careless, or not inordinately risky cannot be grossly negligent. Only if the defendant’s act or omission is unjustifiable and likely to cause serious harm can it be grossly negligent.” Transp. Ins. Co. v. Moriel, 879 S.W.2d 10, 22 (Tex. 1994) (op. on reh’g) (footnote omitted), superseded on other grounds by statute as stated in U-Haul Int’l, Inc. v. Waldrip, 380 S.W.3d 118 (Tex. 2012). Further, a “remote possibility of injuring or even a high probability of minor harm” is not sufficient; rather, it is necessary that there be a “likelihood of serious injury to the plaintiff.” Id.

Plaintiff argues that the Magistrate Judge erroneously found that Harrie did not act with gross negligence when he steered into the westbound/left lane. (Doc. 29 at 7–11). Plaintiff argues that Harrie “knew of the presence of two motorcycles to his rear and he knew they were closing on him,” and that had Harrie kept a proper lookout for traffic he would have seen Plaintiff’s motorcycle beside him and the accident would not have occurred. (Doc. 29 at 10). Plaintiff further argues that Harrie’s decision to move into the westbound lane was deliberate and contemplated. Id. at 9. Plaintiff concludes that there was a “scintilla of evidence that [Harrie] had actual subjective awareness of the extreme degree of risk of moving his [vehicle] into the adjacent left traffic lane without verifying it was safe to do so” and that “Harrie intentionally and blindly steered into the lane to his left without checking for the Plaintiff’s presence, actions that involved an extreme degree of risk to others, and which would support an award of exemplary damages.” Id. at 11.

Based on the evidence presented, it is undisputed that: Harrie was traveling on the eastbound lane of Highway 302 at 68 mph, slightly below the 70 mph speed limit; Harrie was trailed by two motorcycles that were also traveling in the eastbound lane; Harrie saw the motorcycles behind him once at least half a mile behind him, and then again before the accident occurred when the motorcycles were “a few car lengths” behind; there were several feral hogs at least two and a half feet tall on the eastbound lane; Plaintiff moved into the westbound lane to pass Harrie; and Harrie checked for and did not see oncoming traffic in the westbound lane before he “swerved” into the westbound lane to avoid hitting the feral hogs. (Docs. 21 Ex. A, at 46:12–46:15, 60:1–64:21, 68:15–69:14, 72:12–72:15, 76:8–76:9; 29 at 8–10).

*6 Under the objective component, there must be a likelihood that Plaintiff would be injured by Harrie’s action of steering into the westbound lane to avoid the feral hogs without verifying all traffic conditions and despite knowing that two motorcycles were riding in his rear. U-Haul Int’l, Inc. v. Waldrip, 380 S.W.3d 118, 137 (Tex. 2012). Additionally, under the subjective component, Harrie must have known that steering into the westbound lane without verifying all traffic conditions would have caused him to injure Plaintiff and then consciously disregarded that risk. Boerjan v. Rodriguez, 436 S.W.3d 307, 311 (Tex. 2014).

When viewed objectively from Harrie’s standpoint, there was no likelihood that Plaintiff would be injured when Harrie moved into the westbound lane because Harrie was not aware that one of the motorcycles that was previously a few car lengths behind him had moved into the westbound lane to try and pass him. (Doc. 21 Ex. A, at 64:10–64–21). Additionally, there is no indication that Harrie disregarded the consequences of moving into the westbound lane. Rather, Harrie intended to avoid creating a traffic hazard by avoiding the feral hogs that were blocking the lane he was traveling in. Id. at 102:4–102:5. The Court agrees that the record indicates that Harrie made a deliberate decision to move into the westbound lane; however, the record also indicates that it was Harrie’s awareness of the road conditions that led him to conclude he should move into the westbound lane to avoid hitting the feral hogs. Id. at 68:10–75:12. It is not sufficient that Harrie’s act was thoughtless or careless. Therefore, the Court rejects Plaintiff’s argument that Harrie’s action of steering into the westbound lane rises to the level of gross negligence.

IV. CONCLUSION

For the foregoing reasons, the Court concludes that there is substantial evidence in the record to grant summary judgment in favor of Defendant RLG on Plaintiff’s respondeat superior, negligent entrustment, and negligent hiring, supervision, training, and retention claims and on Plaintiff’s exemplary damages claim against both Defendants.

Therefore, IT IS ORDERED that Plaintiff’s objections are OVERRULED and the Report and Recommendation of the United States Magistrate Judge is ADOPTED.

Accordingly, the Court GRANTS Defendants’ Motion for Summary Judgment and DENIES Plaintiff’s Motion for Partial Summary Judgment.

It is so ORDERED.

United States District Court, W.D. Texas, El Paso Division.

Ruben MENDEZ, Plaintiff,

v.

WAL-MART ASSOCIATES, INC., Defendant.

EP-18-CV-189-PRM

|

Signed 09/10/2018

Attorneys & Firms

Tiffany Nicole Joudi, Scherr & Legate, PLLC, El Paso, TX, for Plaintiff.

Robert M. Estrada, Steven Joseph Blanco, Blanco Ordonez & Wallace, P.C., El Paso, TX, for Defendant.

ORDER DENYING PLAINTIFF’S MOTION TO REMAND

PHILIP R. MARTINEZ, UNITED STATES DISTRICT JUDGE

*1 On this day, the Court considered Plaintiff Ruben Mendez’s [hereinafter “Plaintiff”] “Motion to Remand” (ECF No. 5) [hereinafter “Motion”], filed on July 18, 2018; Defendant Wal-Mart Associates, Inc.’s [hereinafter “Defendant”] “Response to Plaintiff’s Motion for Remand” (ECF No. 9) [hereinafter “Response”], filed on July 26, 2018; and Plaintiff’s “Reply in Support of ... Motion to Remand (Doc. 5)” (ECF No. 13) [hereinafter “Reply”], filed on August 2, 2018, in the above-captioned cause. After due consideration, the Court is of the opinion that Plaintiff’s Motion should be denied for the reasons that follow.

I. FACTUAL AND PROCEDURAL BACKGROUND

This case arises out of a workplace injury. Plaintiff alleges that he suffered an injury in the course and scope of his employment with Defendant. Pl.’s Original Compl., Aug. 1, 2018, ECF No. 12 [hereinafter “Complaint”]. Specifically, Plaintiff asserts that he was “stocking a forty pound box of weights on the bottom of a shelf when the shelf broke.” Compl. at 2. As a result, he injured his “right shoulder and other parts of his body.” Id.

On May 1, 2018, Plaintiff brought suit against Defendant in state court. Notice of Removal Ex. A, June 18, 2018, ECF No. 1. Then, on June 18, 2018, Defendant removed the case to federal court, alleging that the Court has diversity jurisdiction over this action pursuant to 28 U.S.C. § 1332. Id. at 1. In Plaintiff’s Motion, he requests that the Court remand the case because his claims “arise under” the Texas Workers’ Compensation Act (“TWCA”), and are, therefore, nonremovable. Mot. 3.

II. LEGAL STANDARD

A. Removal of Actions

28 U.S.C. § 1441(a) provides for the removal of civil actions brought in a state court to the federal district court “embracing the place where such action is pending.” “A federal district court may exercise original jurisdiction over any civil action that either satisfies diversity requirements or that arises under the federal constitution, statutes, or treaties.” Energy Mgmt. Servs., L.L.C. v. City of Alexandria, 739 F.3d 255, 258-59 (5th Cir. 2014) (citing 28 U.S.C. §§ 1331, 1332, 1369). “Thus, under § 1441, removal is proper only when the court has original jurisdiction over at least one asserted claim under either federal question or diversity jurisdiction.” Id. at 259 (citation omitted).

Removal from state court raises federalism concerns. Gutierrez v. Flores, 543 F.3d 248, 251 (5th Cir. 2008). “Federalism concerns animate the rule requiring strict construction of removal statutes.” Beiser v. Weyler, 284 F.3d 665, 674 (5th Cir. 2002). “The removing party bears the burden of showing that federal jurisdiction exists and that removal was proper.” Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002) (citing De Aguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th Cir. 1995) ).

“For diversity jurisdiction, the party asserting federal jurisdiction must ‘distinctly and affirmatively allege’ the citizenship of the parties.” Howery v. Allstate Ins. Co., 243 F.3d 912, 919 (5th Cir. 2001) (alteration omitted) (quoting Stafford v. Mobil Oil Corp., 945 F.2d 803, 804 (5th Cir. 1991) ). The removing party therefore “bears the burden of establishing diversity; if it fails to meet that burden, [a court] cannot presume the existence of federal jurisdiction.” Id.

III. ANALYSIS

*2 Plaintiff’s Motion turns on whether his claim is nonremovable. Congress has deemed certain actions to be nonremovable. See, e.g., 28 U.S.C. § 1445. Relevant here, “[a] civil action in any State court arising under the workmen’s compensation laws of such State may not be removed to any district court of the United States.” Id. at § 1445(c). Thus, if Plaintiff’s action arises under the TWCA, it is nonremovable.

The TWCA provides, in part, “that in an action against a nonsubscribing employer1 for personal injuries or death sustained by an employee, the employer may not rely upon certain common law defenses, and the employee must prove negligence.” Pyle v. Beverly Enters.-Tex., Inc., 826 F. Supp. 206, 209 (N.D. Tex. 1993) (citing TEX. REV. CIV. STAT. ANN. ART. 8308–3.03–04, now codified at TEX. LAB. CODE ANN. § 406.033) ). Accordingly, the Court must conclude whether an employee’s negligence claim against a nonsubscribing employer arises under the TWCA and is, therefore, nonremovable.

The Court has previously addressed this issue and concluded that claims against nonsubscribing employers do not arise under the TWCA. See Casas v. R & L Carriers, Inc., No. EP-17-CV-122, slip op. (ECF No. 15) at 17 (W. D. Tex. June 17, 2017); Rocha v. Macy’s Retail Holdings, Inc., No. EP-17-CV-73-PRM, 2017 WL 8182754, at *2 (W.D. Tex. May 4, 2017); Rodriguez v. Home Depot U.S.A., Inc., No. EP-14-CV-175-PRM, 2014 WL 10183558, at *3 (W.D. Tex. Sept. 11, 2014).

However, the Fifth Circuit has not yet addressed the issue, and federal district courts are split on this issue. Compare, e.g., Wagner v. FedEx Freight, Inc., No. 5:17-CV-264-M-BQ, 2018 WL 2184522 (N.D. Tex. May 11, 2018) (holding that nonsubscriber negligence claims are removable), and Gomez v. O’Reilly Auto. Stores, Inc., 283 F. Supp. 3d 569, 571 (W.D. Tex. 2017) (same), and Poljanec v. Home Depot U.S.A. Inc., No. SA-14-CV-318-XR, 2014 WL 2050946 (W.D. Tex. May 19, 2014) (same), with Ernewayn v. Home Depot U.S.A., Inc., No. EP-12-CV-00387-DCG, 2012 WL 12878298, at *8 (W.D. Tex. Dec. 3, 2012) (holding that nonsubscriber negligence claims are not removable), dismissed, 727 F.3d 369 (5th Cir. 2013), and Figueroa v. Healthmark Partners, L.L.C., 125 F. Supp. 2d 209, 210–11 (S.D. Tex. 2000) (same).

In light of the disagreement among district courts, Plaintiff asks the Court to reconsider its previous determination of the issue. Specifically, Plaintiff avers that his claim is nonremovable because Plaintiff’s right to relief arises under the TWCA and because the split among district courts equates to ambiguity, which should be construed against removal. Mot. 4–7. Below, the Court addresses each of these contentions in turn and concludes that Plaintiff’s Motion should be denied.

A. Whether Plaintiff’s Claim Arises Under the TWCA

For purposes of § 1445(c), a claim arises under the TWCA if: (1) the TWCA establishes the cause of action or (2) Plaintiff’s right to recovery requires the resolution of a substantial question of the TWCA.2 See Franchise Tax Bd. of State of Cal. v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 27-28 (1983) (defining “arising under” for purposes of 28 U.S.C. § 1331); 931 F.2d 1086, 1092 (5th Cir. 1991) (determining that federal law governs the construction of the term “arising under” and that the term is defined the same way in 28 U.S.C. § 1445(c) as it is for purposes of § 1331).3

*3 In this case, the Court determines that the TWCA does not establish Plaintiff’s cause of action and that Plaintiff’s claim does not require the resolution of a substantial question of the TWCA. Accordingly, Plaintiff’s claim does not arise under the TWCA.

1. Whether the TWCA Establishes Plaintiff’s Cause of Action

The TWCA does not establish a cause of action for nonsubscriber negligence. Instead, the Fifth Circuit has held that a negligence claim against a nonsubscribing employer is established by common law. In Rentech, the Fifth Circuit determined that the TWCA “on its face, does no more than modify the defenses available at common law, and does not create a cause of action that usurps the common-law cause of action.” Am. Int’l Specialty Lines Ins. Co. v. Rentech Steel LLC, Bastian v. Travelers Ins. Co., 784 F. Supp. 1253, 1258 (N.D. Tex. 1992) (holding that a contractual bad faith claim against an insurer that pays workers’ compensation claims is a common law claim and does not arise under Texas’s workers compensation laws because “[q]uite clearly, the cause of action ... was not created or determined by a provision of the workers’ compensation laws of Texas”). Rather, the cause of action for negligence remains one that is derived from Texas’ common law. Accordingly, Plaintiff’s claim is not established by the TWCA.

2. Whether Plaintiff’s Right to Recovery Requires the Resolution of a Substantial Question of the TWCA

Plaintiff’s right to recovery does not require the resolution of a substantial question of the TWCA. The Supreme Court has considered the substantial question doctrine in the § 1331 context. Two cases—McVeigh and Grable—are relevant here. While the Supreme Court determined that there was a substantial question of federal law in Grable, it determined that there was no substantial question in McVeigh. One reason these cases were distinguishable was that “Grable presented a nearly ‘pure issue of law,’ one ‘that could be settled once and for all and thereafter would govern’ ” similar cases. Empire Healthchoice Assur., Inc., v. McVeigh, 547 U.S. 677, 700 (2006) (discussing Grable & Sons Metal Prods., Inc. v. Darue Eng’g & Mfg., 545 U.S. 308, 313 (2005) ). Contrastingly, the claim in McVeigh was “fact-bound and situation-specific.” Id. Thus, when a case presents primarily legal questions, it is more likely to require the resolution of a substantial question—of federal law in the context of § 1331, and of a state’s workers’ compensation statute in the context of § 1445(c).

The division between factually intensive versus purely legal questions is instructive in this case. This case requires no statutory interpretation.4 Rather, Plaintiff’s claim is fact-centered because “whether Defendant[’s] acts were negligent is, by nature, a factual inquiry.” Gomez, 283 F. Supp. 3d at 577 (citing J. Weingarten, Inc., v. Brockman, 134 Tex. 451, 135 S.W.2d 698, 699 (Tex. 1940) (“The issue of whether or not given acts constitute negligence is essentially a jury question. The facts of each case must be given independent consideration, and seldom are the facts of any two cases so identical as that the decision in one could be held to be authority for a like decision in the other.”) ). Accordingly, Plaintiff’s claim does not require the resolution of any substantial question of the TWCA.

*4 In support of his position that this case should be remanded, Plaintiff emphasizes the following language from Grable: “the question is, does a state-law claim necessarily raise a stated federal issue, actually disputed and substantial, which a federal forum may entertain without disturbing any congressionally approved balance of federal and state judicial responsibilities.” Mot. 10 (quoting Grable, 545 U.S. at 314). Specifically, Plaintiff asserts that “the Supreme Court in Grable explained the appropriate line of demarcation on the ‘arising under’ analysis for embedded claims (like a nonsubscriber negligence claim) ‘turns on the sound division of labor between state and federal courts ....’ ” Mot. 9 (citation omitted). Thus, it appears that Plaintiff believes that allowing removal in this case upsets Congress’ intended division of labor between state and federal courts, as codified in § 1445(c). Id.

Plaintiff’s reasoning misconstrues § 1445(c)’s purpose. Section 1445(c) “reflects a strong congressional policy that where the state court has been utilized by one of the parties in the state compensation machinery, the case should remain in the state court for its ultimate disposition.” Jones, 931 F.2d at 1091 (citing Kay v. Home Indem. Co., 337 F.2d 898, 902 (5th Cir. 1964) ). However, a common law tort claim is not part of the “compensation machinery” articulated in the state’s statutory scheme. Rather, Plaintiff’s claim is “judicially and not statutorily created.” Jones, 931 F.2d at 1091 n.3 (discussing why some district courts outside of Texas denied motions to remand pursuant to § 1445(c) in retaliatory discharge cases). Plaintiff alleges a negligence claim, which is properly in federal court on the basis of diversity jurisdiction. Thus, the removal of Plaintiff’s claim does not disturb any balance between federal and state judicial responsibilities.

In conclusion, Plaintiff’s claim does not arise under the TWCA. Accordingly, the Court concludes that § 1445(c) casts no doubt on whether a federal court may decide Plaintiff’s claim.

B. Whether the Split Among District Courts Equates to Ambiguity

Federal courts strictly construe removal statutes, and “any doubt about the propriety of removal must be resolved in favor of remand.” Gasch v. Hartford Acc. & Indem. Co.,

Footnotes

1

A “nonsubscribing employer” is one that is not covered by workers’ compensation insurance obtained in a manner authorized by Texas Labor Code § 406.003. An employer covered by workers’ compensation is subject to limited liability for death and injury sustained by an employee in the course and scope of employment without regard to whether the employer acted negligently. A nonsubscribing employer is subject to unlimited liability for death and injury sustained by an employee in the course and scope of employment, but only where the employer acted negligently.

2

Judge Cardone has expressed some doubt as to whether the Fifth Circuit would apply the substantial question basis of § 1331’s arising under test in the context of § 1445(c). Gomez, 283 F. Supp. 3d at 572. Nonetheless, Judge Cardone went on to analyze both prongs of the § 1331 arising under test. Id. at 573.

3

Although the Fifth Circuit has determined that arising under should be defined in the same way for purposes of § 1445(c) as it is for purposes of § 1331, the term may be construed more broadly in § 1445(c) than in § 1331 because Congress had a different intent in enacting the statutes:

[A]pplying the restrictive construction of “arising under” in § 1331 to § 1445(c) results in a restrictive reading of “arising under” in § 1445(c). That reading counsels in favor of removability and conflicts with the Fifth Circuit’s admonition that courts “should read § 1445(c) broadly” in favor of remand.

Gomez, 283 F. Supp. 3d at 572 (citing Jones, 931 F.2d at 1092); see also Sherrod v. Am. Airlines, Inc., 4

While the TWCA limits Defendant’s defenses, no further statutory inquiry is necessary. As stated above, even though the TWCA modifies the defenses available to a defendant, such a modification did not change the Fifth Circuit’s determination that a negligence claim brought against a nonsubscribing employer is, at its core, a common law claim. See Rentech, 620 F.3d at 565 (“[T]he right to bring a claim against a nonsubscriber for negligence remains what it has always been—a right arising under common law.”). Further, the Supreme Court emphasized that, in a § 1331 case, “it takes more than a federal element to open the arising under door.” McVeigh, 547 U.S. at 701. Similarly here, it would take more than a statutory modification of available defenses for Plaintiff’s claim to arise under the TWCA.

5

As mentioned above, federal district courts are split regarding whether a nonsubscriber negligence claim arises under the TWCA. “Courts that have analyzed the substantive issue in recent years, however, almost unanimously agree that negligence claims against a nonsubscriber do not arise under the TWCA.” Gomez, 283 F. Supp. 3d at 578 (collecting cases).

United States District Court, W.D. Texas, El Paso Division.

Chelsey CLIFFORD, Individually and as Next Friend of A.R.C., Minor, and Baby Clifford, Unborn Child, and as Representative of the Estate of Brandon Clifford, Plaintiff,

v.

ABELL ELEVATOR INTERNATIONAL, INC., Defendant.

EP-18-CV-00191-FM

|

Signed 08/27/2018

Attorneys & Firms

Jason Medina, Glasheen, Valles & Inderman, LLP, Lubbock, TX, for Plaintiff.

Edward J. Hennessy, The Hennessy Law Firm, Houston, TX, for Defendant.

ORDER DENYING PLAINTIFF’S MOTION TO REMAND TO STATE COURT PURSUANT TO 28 U.S.C. § 1445(c)

FRANK MONTALVO, UNITED STATES DISTRICT JUDGE

*1 On this day, the court considered “Plaintiff’s Motion to Remand to State Court Under 28 U.S.C. § 1445(c) and Brief in Support” (“Motion”) [ECF No. 5], filed July 17, 2018 by Chelsey Clifford, individually and as next friend of A.R.C, minor and Baby Clifford, unborn child, and as representative of the Estate of Brandon Clifford (“Plaintiff”); the “Response of Defendant Abell Elevator International, Inc. to Plaintiffs’ Motion to Remand” (“Response”) [ECF No. 6], filed July 24, 2018 by Abell Elevator International, Inc. (“Defendant”); and “Plaintiff’s Reply to Defendant’s Response to Plaintiff’s Motion to Remand and Brief in Support” (“Reply”) [ECF No. 10], filed July 31, 2018 by Plaintiff. Based on the Motion, Response, Reply, and the applicable law, the Motion is DENIED.

I. BACKGROUND

A. Factual Background and Procedural History

On May 16, 2018, Plaintiff filed “Plaintiff’s Original Petition and Jury Demand”1 in the 327th Judicial District Court of Texas in El Paso, County.2 Therein, she asserts claims of gross negligence and wrongful death.3 On June 20, 2018, Defendant removed the cause to this court asserting federal jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1332.4

On January 9, 2018 Brandon Clifford (“Decedent”), an employee of Defendant, was working on an elevator system at William Beaumont Army Medical Center (“WBAMC”) in El Paso, Texas when he was electrocuted and killed.5 Chelsey Clifford (“Plaintiff”) is Brandon’s surviving spouse, and A.R.C. and Baby Clifford (“B.C.”) are his surviving children.6 Plaintiff resides in El Paso County, Texas.7 Defendant is a Kentucky corporation doing business in Texas.8 Plaintiff insists that the “monetary damages sought will fall within the limits set out in Texas Rule of Civil Procedure 47(c)(5),”9 which encompasses “monetary relief over $ 1,000,000.”10

B. Parties’ Arguments

Plaintiff argues that, as Defendant subscribed to worker’s compensation insurance and maintained coverage for the decedent,11 28 U.S.C. § 1445(c) (“Section 1445(c)”) renders this action non-removable because it arises under Section 408.001(b) of the Texas Labor Code (“Section 408.001(b)”).12 Plaintiff cites the United States District Court for the Southern District of Texas, which remanded a case noting that there are no common law remedies for wrongful death in Texas.13 Plaintiff argues that, as Texas law does not require actual damages as a prerequisite for exemplary damages, Section 408.001(b) creates and independent cause of action for exemplary damages.14 Given the principle that the removal statute must be strictly construed in favor of remand, Plaintiff argues, the court should remand the case.15

*2 In its Response, Defendant argues that Section 408.001(a) of the Texas Labor Code (“Section 408.001(a)”) bars compensatory damages and allows claims for exemplary damages based on gross negligence, which Section 408.001(b) exempts from the prohibition set forth in Section 1445(c).16 Accordingly, Defendant argues, the issue is whether Plaintiff’s claim “arises under”17 Section 408.001(b).18 Defendant argues that Plaintiff’s claim does not arise under this section because the plain language of Section 408.001(b) makes it clear that it merely preserves a cause of action rather than creates one.19 After engaging in a brief discussion of the history of worker’s compensation statutes in Texas, Defendant explains that the structure of the Texas Workers’ Compensation Act was designed to handle workers’ claims expeditiously, and that there is no individualized provision to handle this type of claim, merely one that preserves it, indicating that the statute did not create this cause of action.20 Defendant adds that the Fifth Circuit supports this understanding of the statute.21

In her Reply, Plaintiff reiterates the argument that Section 408.001(b) creates a new and separate cause of action, namely a claim seeking exemplary damages for wrongful death.22 She argues that Plaintiff’s claims could only arise under the workers’ compensation statute.23 She further posits that Section 408.001(b) creates a cause of action for wrongful death where there are allegations of gross negligence, and that Congress clearly intended federal courts to remand in such instances.24

Thus, the issue before the court is whether Section 408.001(b) creates an independent cause of action for gross negligence, or rather merely saves or preserves a pre-existing cause of action under the Texas Wrongful Death Act. If it does, then Plaintiff’s claim arises under Section 408.001(b) and must be remanded pursuant to Section 1445(c); if it does not, then the court retains jurisdiction over this cause.

II. APPLICABLE LAW

A. The Standard for Remand

Under 28 U.S.C. § 1447(c) (“Section 1447(c)”), if “at any time before final judgment” a district court determines that it lacks subject matter jurisdiction, “the case shall be remanded.” The burden falls to the removing party to establish that federal jurisdiction exists.25 Removal from state court generates significant concerns of federalism.26 Accordingly, federal courts must strictly construe removal statutes, and “any doubt about the propriety of removal must be resolved in favor of remand.”27 It is the removing party’s burden to establish that federal jurisdiction exists and that removal was proper.28

III. DISCUSSION

“A civil action in any State court arising under the workmen’s compensation laws of such State” may not be removed to federal court.29 The removal of civil actions to federal court is governed by 28 U.S.C. § 1441(a) (“Section 1441(a)”), and courts strictly construe this statute because its invocation “deprives a state court of a case properly before it and thereby implicates important federalism concerns.”30 It falls to the removing party to establish that removal was proper and that federal jurisdiction exists.31 In evaluating whether federal jurisdiction exists, the federal court’s analysis is confined to the claims set forth in the plaintiff’s complaint at the time of removal.32 The court must also strictly construe “any ambiguities” in favor of remand.33

*3 Plaintiff has filed her Motion pursuant to 28 U.S.C. § 1445(c) (“Section 1445(c)”), which precludes removal of claims arising under state workers’ compensation laws. She insists that her claims “arise under” Section 408.001(b) of the TWCA, rendering it non-removable pursuant to Section 1445(c).34 Defendant counters that Section 408.001(b) merely preserves rather than creates a cause of action, and Plaintiff’s claim therefore does not arise under the TWCA.35 A suit “arises under the law that creates the cause of action.”36 The Fifth Circuit instructs that this standard is to be interpreted broadly, as a means to “further Congressional intent toward maintaining state court jurisdiction over workers’ compensation cases filed in state court.”37

Plaintiff’s Original Petition asserts claims for gross negligence and wrongful death, and explicitly states that these claims arise under Section 408.001(b). This section provides that recovery of workers’ compensation benefits “is the exclusive remedy of an employee covered by workers’ compensation insurance coverage.”38 Section 408.001(b), however, states that this section “does not prohibit the recovery of exemplary damages by the surviving spouse or heirs of the body of a deceased employee whose death was caused by an intentional act or omission of the employer or by the employer’s gross negligence.”39 Put another way, an employee who is killed in the course of his or her employment may not recover from their employer except through the framework set forth by the TWCA. This scheme gives employees the benefit of their employer’s insurance policies, and it protects employers from extraneous litigation.40

This case turns on whether Section 408.001(b) creates an independent cause of action for gross negligence, and thus Plaintiff’s claim arises under the TWCA; answering this question is necessary to determine whether the claim must be remanded pursuant to Section 1445(c). First, the court will examine the history of wrongful death in Texas. At one point in time, Texas conceived of “wrongful death” as a “criminal matter” that was “not cognizable in a civil court.”41

This framework underwent a dramatic shift in the late 19th Century, when Texas adopted the Wrongful Death Act; this statute created a civil cause of action for the heirs of a person killed by the negligence of another.42 Not long thereafter, Texas courts began to dispute whether the law subjected a defendant to punitive damages.43 The Texas legislature stepped in to clear this up by amending the Texas Constitution “to allow for punitive damages in favor of wrongful death beneficiaries.”44 In 1913—not long thereafter—the Texas legislature passed the first workers’ compensation act.45 The TWCA limited an injured or deceased employee from suing outside of its framework, with the notable exception of claims for gross negligence by the heirs of a deceased employee.46 As the Texas Constitution expressly recognized this right, the TWCA ensured it would continue to exist. The Fifth Circuit has also recognized this exception, writing that the Texas legislature has “expressly exempted exemplary damages from the purview of the TWCA.”47

*4 Given the legislative history, and the state’s acts to carve out a space for a pre-existing right, it becomes evident that the cause of action does not “arise under” the TWCA but is merely preserved by it. This conclusion is further supported by a plain reading of the text of Section 408.001(b) itself; it does not speak of creating a right to sue, but merely states that a claimant is not prohibited from seeking exemplary damages in wrongful death cases involving allegations of gross negligence.48 It is further worth noting that Section 408.001(b) itself does nothing to advance the purpose of the overall statute, namely to assist in the expeditious resolution of employee injury claims. This further supports the conclusion that this provision does not create a cause of action.

This conclusion is further borne out by Texas case law. In Duhart v. State, the Texas Supreme Court held that the predecessor to Section 408.001(b) did “not create a cause of action for exemplary damages, but merely saves an existing one to the extent allowed by law.”49 Similarly, a Texas court of appeals held that “Section 408.001(b) ... does not create a nonderivative cause of action for exemplary damages under the Wrongful Death Act.”50

Plaintiff places heavy emphasis on the holding in CONCLUSION

“Plaintiff’s Motion to Remand to State Court Under 28 U.S.C. § 1445(c) and Brief in Support” [ECF No. 5] is DENIED.

SO ORDERED.

Footnotes

1

See “Notice of Removal,” ECF No. 1, Ex. 4, “Plaintiff’s Original Petition and Jury Demand” (“Original Petition”), filed June 20, 2018.

2

Id.

3

Id. at 4–7.

4

Not. of Rem. 2–4 ¶¶ 4–7.

5

Mot. 1 ¶ 1.

6

Orig. Pet. 3 ¶ 4.01.

7

Id. at 1 ¶ 2.01.

8

Not. of Rem. 3 ¶ 5.5.

9

Orig. Pet. 3 ¶ 3.05.

10

TEX. R. CIV. P. 47(c)(5).

11

Mot. 1 ¶ 1.

12

Id. at 2–3 ¶ 17.

13

Id. at 3 ¶ 19.

14

Id. at 4 ¶ 10.

15

Id. at 4–5 ¶ 12.

16

Resp. 1 ¶ 1.

17

28 U.S.C. § 1445(c).

18

Resp. 2 ¶ 3.

19

Id. at 3 ¶ 7.

20

Id. at 5 ¶ 10.

21

Id. at 5–6 ¶ 11 (citing Satin v. Allied Signal Inc., 22

Reply 1 ¶ 1.

23

Id. at 2 ¶ 3.

24

Id. at 6 ¶ 11.

25

De Aguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th Cir. 1995).

26

Gutierrez v. Flores, 543 F.3d 248, 251 (5th Cir. 2008).

27

Gasch v. Hartford Acc. & Indem. Co., 28

Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002) (citing De Aguilar v. Boeing Co., 47 F.3d 1404, 1408 (5th Cir. 1995) ).

29

28 U.S.C. § 1445(c).

30

Frank v. Bear Stearns & Co., 128 F.3d 919, 922 (5th Cir. 1997) (citation omitted).

31

See, e.g., Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002).

32

Id. at 723 (citing Cavallini v. State Farm Mut. Auto Ins. Co., 44 F.3d 256, 264 (5th Cir. 1995) ).

33

Id. (citing Acuna v. Brown & Root Inc., 200 F.3d 335, 339 (5th Cir. 2000) ).

34

Mot. 2–3 ¶ 17.

35

Resp. 2 ¶ 4.

36

Jones v. Roadway Express, Inc., 37

Sherrrod v. Am. Airlines, Inc., 38

TEXAS LABOR CODE§ 408.001(a).

39

Id. § 408.001(b).

40

Patterson v. Mobil Oil Co., 41

Travelers Indem. Co. of Ill. V. Fuller, 892 S.W.2d 848, 850 (Tex. 1995) (citing Baker v. Bolton, 1 Camp. 493, 170 Eng. Rep. 1033 (1808) ).

42

Act approved Feb. 21, 1879, 16th Leg., R.S., ch. 52, § 2, 1879 Tex. Gen. Laws 41, 41 reprinted in 9 H.P.N. Gammel, The Laws of Texas 1822-1897 at 842 (Austin, Gammel Book Co. 1898).

43

See, e.g., Fuller, 892 S.W.2d at 850.

44

Id.

45

733 F.2d 1153, 1154–55 (5th Cir. 1984).

46

Id.

47

Id. at 1154.

48

TEXAS LAB. CODE § 408.001(b).

49

610 S.W.2d 740, 741–42 (Tex. 1980).

50

Ross v. Union Carbide Corp., 296 S.W.3d 206, 214 (Tex. App.—Houston [14th Dist.] 2009 pet. Denied) (en banc) (“[S]ection 408.001(b) of the Workers’ Compensation Act does not purport to create an independent cause of action, but instead identifies an exception to the Act’s exclusivity provision.”).

51

124 F. Supp. 2d 1090 (S.D. Tex. 2000).

52

Mot. 2–3 ¶ 7.

53

Sbrusch, 124 F. Supp. 2d at 1091.

54

Orig. Pet. 3 (“Plaintiff seeks monetary damages exceeding the limits set out in TEX. R. CIV. P. 47(c)(1).”).

United States District Court, W.D. Texas, San Antonio Division.

Abel MESA, Plaintiff,

v.

The CITY OF SAN ANTONIO, Acting BY AND THROUGH its Agent, CITY PUBLIC SERVICE BOARD d/b/a CPS Energy, Defendant.

Civil Action No. SA-17-CV-654-XR

|

Signed 08/16/2018

Attorneys & Firms

Adam Poncio, Alan Braun, Thomas Newton Cammack, III, Poncio Law Offices PC, San Antonio, TX, for Plaintiff.

Christine Elaine Reinhard, Delilah S. Evans, Shannon B. Schmoyer, Schmoyer Reinhard LLP, San Antonio, TX, for Defendant.

ORDER

XAVIER RODRIGUEZ, UNITED STATES DISTRICT JUDGE

*1 On this date, the Court considered Defendant CPS Energy’s Motion for Summary Judgment (docket no. 41) and the corresponding Response1 (docket no. 43) and Reply. After careful consideration, Defendant’s motion is GRANTED IN PART and DENIED IN PART.

BACKGROUND

The live Complaint is Plaintiff’s Second Amended Complaint. Docket no. 29. Therein, Plaintiff Abel Mesa sues his former employer, CPS Energy, alleging a number of employment discrimination and retaliation claims. Defendant moves for summary judgment on all claims. As discussed below, Plaintiff concedes several of his claims, but continues to maintain claims for disability discrimination under the “regarded as” prong of the Americans with Disabilities Act (“ADA”), disability discrimination under the ADA based on association with his disabled wife, retaliation under the Family and Medical Leave Act (“FMLA”), and age discrimination under the Age Discrimination in Employment Act (“ADEA”).

Mesa was hired by CPS Energy in 1990 and remained employed by CPS Energy until his alleged involuntary retirement in 2016. In February 2013, Mesa’s wife was diagnosed with pancreatic cancer, and Mesa utilized intermittent leave under the FMLA through September 2016 to care for her. Mesa testified that no one ever said anything to him “that they were concerned or bothered by her treatment expenses” or his use of FMLA leave, and he never felt he was being treated differently because his wife had cancer before the events in 2016 leading to this lawsuit. Mesa depo. at 47, 63, 70-71, 77-78.

In 2016, Mesa worked as a control room operator at the Milton B. Lee West power plant, also known as the Leon Creek power plant. A control room operator operates the power plant. Urrutia depo. at 31. Mesa’s direct supervisor was Vernon King; his Level 2 manager was Kevin Drennan, an operations manager stationed at the Braunig power plant; and his ultimate manager was Rick Urrutia, CPS Energy’s Interim Senior Director over four power plants, including Leon Creek.

Drennan testified that Mesa talked several times about retiring at the end of 2016, “once he made his years of service.” Drennan depo. at 6. Mesa testified that in 2016 he sought information about his retirement benefits. Mesa depo. at 89. On August 30, 2016, Mesa and his wife visited with CPS Energy’s Employee Benefits department to obtain an estimate of his potential pension benefits upon retirement. Docket no. 41-2 ¶ 5; Mesa depo. at 97. Mesa filled out a Pension Estimate Request with estimated retirement dates of December 1, 2016, February 1, 2017, and August 1, 2017. Docket no. 41-5. December 1, 2016 was the date on which he would have sufficient years of service to retire with full benefits. Docket no. 41-2 (Zinsmeyer Decl.) ¶¶ 5-6. Mesa testified that the HR employee he met with was unable to answer all of his questions about taxes and insurance and different payment options. Mesa depo. at 93.

*2 On September 9, 2016, Plaintiff emailed Drennan of his intent to retire. His email states, “I plan on retiring. Need to talk to my Broker about Best Option for Me. Analyst could not answer all my questions.” Docket no. 41-7. Mesa testified that he sent this email because Drennan “was pushing the issue for me to retire” and “this was my way of kind of like slowing down the process so I wouldn’t have to - That’s the way I felt at the time to answer.” Mesa depo. at 101. However, Mesa then stated that Drennan was not pushing, that he only had one conversation with Drennan about whether he was planning to retire, and that he sent this email on his own. Id. at 101-02.2

Mesa’s Response to the Motion for Summary Judgment states that this email was sent to Drennan “as requested,” but Mesa’s deposition testimony is clear that no one “requested” that he send this email. Mesa and Drennan agree that they discussed how Mesa could see his retirement numbers, but the specifics of the conversation differ. Mesa testified that Drennan told him to send the intent to retire and told him what to say in order to see his numbers. Mesa depo. at 48. Mesa said that Drennan told him, “Put this the way it is and send it to that Mr. Robinson and he’ll show you the numbers and he can pull your -- your papers. This don’t mean that you’re going to retire. This is just to see your numbers.” Mesa depo. at 48. Mesa testified that Drennan told him he could later tell them, after getting his estimates, that he did not want to retire and that they would “pull his papers,” and that this was a normal procedure. Mesa depo. at 138. Drennan testified that Mesa had said he wanted more information about what his numbers would look like, so he shared with him that he had used the online tool to get calculations, and never suggested that he should send him an intent to retire to find out more information. Drennan depo. at 7. Mesa testified that he was aware of and had used the online tool, but it did not provide enough information about insurance and “take home” pay. Mesa depo. at 80, 90, 97. Thus, the evidence does not show that Drennan requested the email, but the evidence raises a fact issue as to whether Drennan suggested that Mesa send the email (and how to word it) in order to see his retirement numbers.

After Mesa emailed Drennan his intent to retire, Drennan responded back thanking him for the notice and asking him to update with the intended retirement date as soon as possible. Docket no. 41-7. Mesa and Drennan had no further conversations about Mesa retiring, and Mesa did not talk to anyone else in management about retiring. Mesa depo. at 103. Mesa testified that he did not ask for any more numbers to be run by the pension department because he “wasn’t interested in retiring” and the numbers would be good for another year. Id. Mesa testified that he did not meet with his broker. Id. at 104.

On Monday, September 12, 2016, Plaintiff was on a ladder at work and had his left arm raised when he felt extreme pain in his left shoulder. He was afraid to get down and asked a co-worker to call EMS; he was taken to the emergency room by ambulance. Mesa depo. at 104-06. The emergency room physician took x-rays and gave him pain medication, diagnosed him with a shoulder sprain, and released him the same day with instructions to follow up with a private physician in one to two days for “Further diagnostic work-up, Recheck today’s complaints, Continuance of care.” Mesa depo. at 106-07; docket no. 41-9; docket no. 43-1 at 65 (Ex. 7).

*3 A worker’s compensation claim was opened with Broadspire, CPS Energy’s third-party workers’ compensation administrator. Docket no. 43-1 (Ex. 8). The next day, Tuesday September 13, Mesa was evaluated at Texas MedClinic on Bandera Road. This appointment was facilitated by Jose Castaneda, the Safety and Health Program Manager at CPS, to ensure further care in accordance with workers’ compensation regulations. Castaneda depo. at 11-12. The MedClinic records indicate that Mesa was diagnosed with a left shoulder strain and prescribed ice, range-of-motion exercises, and “ibuprofen during the day, tramadol as needed at bedtime with two Tylenol.” They also state, “May need physical therapy if not progressing.” Docket no. 43-1 at 72.

Texas MedClinic provided a Texas Workers’ Compensation Work Status Report, which released Mesa to return to work with certain restrictions expected to last through September 16, including: no climbing stairs or ladders, no reaching, no overhead reaching, no lifting or carrying, and automatic transmission driving only. Docket no. 41-10. A follow-up evaluation was scheduled for 10:30 a.m. on Friday, September 16. Id. Castaneda stated that receipt of this information started the ADA process, that the next step was to identify whether the business area could accommodate Mesa based on the restrictions outlined by the treating physician, and that this was handled by human resources. Castaneda depo. at 12.

Lisa Jarzombek in CPS’s Absence Management Department received the Texas MedClinic evaluation in the afternoon of September 13 and emailed Drennan, Vernon King, and Toni Harris-Rowland in Human Resources stating that Mesa needed light duty accommodation “effective 9/13/16 through 9/16/16” with a follow-up appointment scheduled for September 16. Docket no. 41-11. The email asked “HR/Mgmt” to “please make the necessary accommodations and forward the signed BFOE [bona fide offer letter for a light duty assignment] to the Leave [Department] in box once completed.” Id.

On or about September 14, Mesa was contacted by doctors in Houston who were treating his wife’s cancer, and they instructed him that his wife needed an infusion in Houston on Friday, September 16. Mesa depo. at 117. Mesa contacted the Texas MedClinic on September 14 to reschedule his September 16 follow-up appointment. Docket no. 43 at 77 (Ex. 11). Documents indicate that on the 15th at 11:05 a.m., Broadspire (the third-party workers’ compensation administrator) received a notice stating that Mesa called on September 14 to reschedule the appointment “due to him going out of town” and that the rescheduled appointment was set for September 23 at noon. Docket no. 43-1 at 77 (Ex. 11). Plaintiff’s brief asserts that this was sent by fax to Jarzombek, but the information at the bottom of the page states “BroadSpire Receive date - 9/15/2016.” The notice includes information about Mesa’s employer and contact information (phone and fax) for Jarzombek, but does not indicate that it was faxed to her. It appears that Jarzombek was aware that Mesa had rescheduled the appointment, but not why, by the morning of the 15th. Docket no. 43-1 at 81.3

*4 On Thursday, September 15 at 9:44 a.m., Toni Harris-Rowland from HR emailed Lisa Jarzombek in the Leave Department asking for Mesa’s contact number, which Jarzombek then provided. Docket no. 41-11. At 9:56 a.m., Harris-Rowland emailed Drennan, Jarzombek, and Urrutia stating, “I spoke with Abel [Mesa] he will report to Ron at Braunig [power plant] tomorrow at 6:30 am. I will send a meeting invite with the bona fide offer letter and accommodation checklist for us to review with the employee and obtain signatures.” Id. Harris-Rowland testified that she had the phone conversation with Mesa “[s]ometime prior to sending the e-mail usually right after I speak to the employee.” Docket no. 43-1 at 144. Jarzombek responded at 10:30 a.m. and asked if Mesa had mentioned anything about why he rescheduled his appointment, and Harris-Rowland responded only that he had asked for the fax number. Docket no. 43-1 at 81. At 4:17 p.m., Jarzombek sent an email (recipients unknown) stating, “I received a call from the adjuster at Broadspire. Abel Mesa will be returning to work tomorrow to sign his BFOE.” Docket no. 41-12.

At some time on the 15th, Mesa requested FMLA leave for Friday September 16 and Monday September 19 and it was approved, but fact issues exist as to when CPS Energy became aware of it. It appears that Drennan, Harris-Rowland, and others still expected Mesa to report for work at the Braunig plant at 6:30 a.m. for light duty. Records show that Reed Group, the FMLA administrator, informed CPS Energy by letter directed to Vernon King dated September 15 that Mesa requested FMLA leave and was approved for time off on the 16th and 19th. Docket no. 43-1 at 80 (Ex. 12), at 81 (Ex. 13). However, it is not specified when, how, or to whom this letter was actually transmitted. Harris-Rowland testified that “[t]he normal process is for them to come through the workflow.” Docket no. 43-1 at 146.

Mesa testified that at some unspecified time, which he appears to believe was on the 15th, Harris-Rowland called him and made a comment to him that he “moved [his] appointment to go to Houston to have fun.” Mesa depo. at 73.4 Mesa testified that he explained to her that he was going to Houston for his wife’s appointment. Mesa also testified that Harris-Rowland was upset because she wanted him to go to the Braunig plant on light duty work, and he had “over writ” what she wanted him to do. Id. at 74. He testified that Harris-Rowland told him he was “bona fiding [her] offer,” meaning that he “was not going to take” what she was offering, but that he had not been aware of the offer. Id. at 73-74, 77. Mesa also testified, “And that’s where I had already had it with FMLA that I could go. And Vernon [King] had approved it to go so - And I told her - I told Vernon. Vernon was upset because - And he told me - Vernon told me: Abel, you go take care of your wife.” Mesa depo. at 73-74.

At 7:35 a.m. on Friday the 16th, Harris-Rowland sent an email stating that Mesa did not report to work and did not return calls from his supervisor and asked “what is his status?” Docket no. 43-1 at 92 (Ex. 15). Harris-Rowland sent an email at 8:51 a.m. stating, “Abel called me at 8:20 a.m. to tell me he called his manager this morning and Reed yesterday and his manager this morning [sic] to let them know he would not be reporting to work today. Abel advised me yesterday that he was not going to report because he did not feel well and he was going to the doctor’s to get a new FFD.”5 Id. At 9:19 a.m., Drennan emailed Harris-Rowland, Jarzombek, Veronica Wycoff, Interim Human Resources Manager, and others to say that he called Mesa that morning because he did not report to Braunig for light duty work as expected and that Mesa told him that he had contacted Reed Group for FMLA leave that day and Monday, and Drennan told Mesa to contact Harris-Rowland and provide this update.6 Docket no. 43-1 at 91 (Ex. 15).

*5 At 9:39 a.m., Wycoff responded that “[w]hen employees are reporting absences (since he was expected to return today), the expectation is that they contact their supervisor to report and follow the reporting expectations, per the Attendance Guidelines,” and “[i]f they are requesting FML, their second call would be to Reed Group.” Id. Wycoff asked the leave team to keep her posted if they were aware of an FMLA request. Id. At 10:58 a.m., the Leave Department responded, stating, “Yesterday evening, Reed Group processed Mr. Mesa’s request for intermittent time off for dates 9/16/16 and 09/19/16. Both requests have been approved.” Wycoff responded “please follow up with Abel upon his return if he did not timely report his absence to his supervisor.” Id.

On September 19, Jarzombek emailed Harris-Rowland, Drennan, and others stating that she just “received a call from the workers’ compensation adjuster on Abel Mesa” and that “he told her he will be reporting to work tomorrow, 9/20/2016” and would be contacting HR or his supervisor about what time to report. Docket no. 41-12; docket no. 43-1 at 89. Drennan asked if Mesa was released for full duty or still needed the light duty accommodation, and Jarzombek responded, “The assumption is for the light duty accommodation. He was told his work status has expired and he will be going to a different clinic that he will be making an appointment with this week.” Id. Drennan responded at 1:30 p.m., “I’m not sure about the work status expiring, however if he is on light duty he will report to [Braunig], if released for full duty he will report to [Leon Green].” Id. A short while later, Harris-Rowland responded to Jarzombek’s email (which included Wycoff, the Leave Department, Drennan, Kipling Giles, and Ronaldo Gutierrez) stating, “What is he [sic] time code for today since he refused to report on Friday for the Bona Fide Offer.” Docket no. 43-1 at 89.

Mesa testified that Broadspire, CPS Energy’s third party worker’s compensation administrator, set up a follow-up appointment at 8 a.m. on September 20 at Nova Clinic. Mesa depo. at 150. Nova Clinic gave Plaintiff a full duty work release that same day, which noted that it was the last scheduled visit for the problem and that no further medical care was anticipated. Docket no. 41-15. Broadspire’s documentation dated September 20 states, “there is no medical management exposure as employee was released to full duty and from doctor’s care on 09/20/16” and includes the action plan “close file if no further treatment required since 09/20/16. 10/2016” and the goal “closure by 10/2016.” Docket no. 43-1 at 97.

Mesa returned to work on September 20 and gave his full duty work release form to King. Castaneda testified that he received notice of the release and found it had been approved. Castaneda depo. at 15. In response to an inquiry from Jarzombek, Drennan stated that Mesa “has a full release to give his SS at MBLW [Leon Green] today.” Docket no. 41-16. Jarzombek asked to be a given a copy once it was received, and at 4:39 that afternoon sent an email to Drennan, King, Harris-Rowland, and the Occupational Health and Leave departments, stating it had been received and that “[h]e has a full duty release for 9/20/16 and no further medical is anticipated.” Docket no. 41-16.

Also in the afternoon on September 20, Mesa emailed Drennan (copying Kelly Robinson, a Benefits Analyst in CPS Energy’s Employee Benefits Department) with the subject “Retirement,” stating, “My Intent to retire is December 1, 2016.” Docket no. 41-8; docket no. 41-2 ¶ 8. Drennan responded, “Message received,” and copied Urrutia as well as Patricia Villa, the interim manager over the Leon Creek and Braunig Power Plants. Mesa testified that he sent this in order to receive all of his benefits information and that Drennan had told him what to say. Mesa depo. at 48. Defendant has submitted evidence that employees are not required to submit an intent to retire to obtain pension estimates. Docket no. 41-2 ¶¶ 4, 7.

*6 In the afternoon on September 21, Drennan forwarded Jarzombek’s email about the full duty release (and a copy of the release) to Urrutia, stating “This is what we received yesterday.” Docket no. 41-16. At some point, there was a meeting or discussion involving the chief safety and security officer, Fred Bonewell, and “leadership from Power Generation” (Castaneda believed it was Urrutia, and Urrutia recalled a conversation) to discuss concerns “about conflicting reports from the two different facilities that Mr. Mesa had sought medical care [from].” Castaneda depo. at 16-17; Urrutia depo. at 47. Castaneda thought it was Urrutia who had these concerns. Castaneda depo. at 17. Urrutia testified that “this employee is in a heavy industrial environment, sometimes has to work alone so we have to make sure that our employees are fit for the duty.” Docket no. 43-1 at 112.

Castaneda noted that the Texas MedClinic report stated that Mesa sustained injuries that required restrictions that were very specific, in addition to prescription medications, and then the Nova Clinic report said that he was clear to return to work full duty with no restrictions, and there were concerns about what Mesa’s abilities were, to make sure he could do the job. Castaneda depo. at 17. Castaneda testified that “there was concern about his well-being, considering he had significant restrictions in the previous appointment, and now he had no restrictions.” Id. at 25. There were discussions about Mesa undergoing an MRI7 and there were discussions about him undergoing additional testing through a human performance evaluation (a fitness for duty exam). Id. at 23-35. Castaneda stated that it was a consensus and it was his recommendation that Mesa have the human performance evaluation. Id. at 17-18.

On the 21st, Mesa worked a partial shift, but was then escorted off the job by King and had his badge taken away. Mesa depo. at 158. Mesa was told “something was wrong with the paperwork” and that he would be on paid administrative leave until he heard from Drennan. Mesa depo. at 158. Urrutia testified that “we had him leave work because he wasn’t cleared for work by CPS Energy.” Urrutia depo. at 33. Urrutia testified that he spoke with Harris-Rowland, and then instructed the team at Leon Creek to have Mesa go home because he was not cleared for work. Urrutia depo. at 33.8 Urrutia testified that clearing employees to return to work was a “joint effort between the business unit, HR, safety, in some cases, legal and upper management” and the “occupation health [department] would, you know, schedule a fitness for duty to determine if the employee is fit to return to work.” Urrutia depo. at 34-35. Drennan testified that when employees were out because they were not cleared to return to work, their badges were not normally taken away. Drennan depo. at 13.

*7 Mesa was then off his regular days the next two days and scheduled to work the 24th through the 27th, but he testified that he did not hear from anyone on those days. Mesa depo. at 160. He called Drennan on September 28, and Drennan said someone would notify him. Id. Urrutia testified that there was such a long gap because they were “trying to understand the status of the employee’s return to work status” because they did not get follow-up information from the MedClinic follow-up appointment and they were trying to understand why Mesa did not go to the scheduled appointment on the 16th, why he did not go back to the original doctor, the reports were inconsistent, and it “took us time to determine what - what do we need to do to understand the employee’s fitness for duty to ensure that he’s safe and nothing happens to him and it took eight days to do that.” Urrutia depo. at 37. Urrutia stated that the concern was not where Mesa was on the 16th, but the inconsistent reports from different evaluators. Urrutia depo. at 42-43. Castaneda filed an affidavit stating that Mesa had provided two conflicting medical releases - one with restrictions that had not been lifted due to his failure to attend a follow-up appointment (MedClinic) and one without any restrictions at all (Nova). Docket no. 41-29.

On September 28, Castaneda called Mesa about scheduling a human performance (fitness for duty) evaluation. Castaneda depo. at 18. Castaneda testified that Mesa informed him that he would be going the next morning. He testified that he did not give Mesa options on when to go, that “[i]t was specific to the next morning,” and that Mesa “said he was going to be available to go.” Id. at 18-19. Castaneda stated that there was no set appointment time and that it was a walk-in appointment, but Mesa “was given specific instructions to go on this specific date because of the authorization to treat.” Castaneda depo. at 21. Castaneda’s affidavit states that, when he completes an authorization for an employee to attend a fitness for duty exam, the authorization is only for the specific date listed. Docket no. 41-29. Castaneda emailed Harris-Rowland and Urrutia on the morning of the 28th and said, “I was able to get a hold of Mr. Mesa and he will be going tomorrow morning to undergo his fitness for duty physical.” Docket no. 41-19.

However, Mesa testified that Castaneda told him he could go on Thursday the 29th or Friday the 30th, and that he chose to go Friday. Mesa depo. at 166, 171. He did not recall Castaneda saying he would see him at Concentra on the 29th. Id. at 166. On September 29, Castaneda went to Concentra and waited for a couple of hours to see if Castaneda had any questions or concerns, but Castaneda did not appear. Castaneda depo. at 19. Castaneda texted Mesa on his personal cell phone that afternoon to see if he had gone to Concentra, but Mesa testified that he did not see the text until the next day because he “[doesn’t] ever carry a cell phone.” Mesa depo. at 170.

CPS Energy conducted a conference call that evening about Mesa. Castaneda depo. at 20; Urrutia depo. at 48-51. Defendant’s evidence indicates that this call had been previously scheduled among Castaneda, HR representatives, and Mesa’s senior leadership team to discuss the results of Mesa’s fitness-for-duty-exam. During the call, Castaneda informed the others that Mesa had not appeared for the exam. Castaneda testified that there was a “question as to why he didn’t show up” and the participants “had concerns about [Mesa’s] well-being.” Castaneda depo. at 20. Castaneda testified that a decision was made during the call to place Mesa on unpaid leave until his December 1 retirement date. Urrutia was unsure when the actual decision was reached, but agreed it was made by September 30. Urrutia depo. at 56. Urrutia testified that Mesa’s past disciplinary and work history were not discussed, and different disciplinary options were not discussed. Urrutia depo. at 50-51, 58-59. There was no discussion about rescheduling the human performance evaluation. Castaneda depo. at 21; Urrutia depo. at 53.

Castaneda testified, “We did discuss what next steps would be taken as far as getting him to his retirement dates.” Castaneda depo. at 20. He further testified, “At that point, he was on administrative leave. And I think they were trying to get him to the end of the month. Because that’s the way the retirement process works, you go to the end of the month. And then day one of the following month is the retirement day.” Id. Castaneda said the decision was to have Castaneda remain on leave, but he did not recall who made the decision. Castaneda depo. at 22.

*8 Urrutia testified that the decision was based on “the fact that Mr. Mesa did not show up to his assigned fitness for duty assigned by occupational health, the fact that we’re concerned about the safety of the employee, you know, he did submit his retirement, intent to retire on the 20th, so instead of corrective action process we decided to put him on unpaid leave and not interrupt his end - employment until his retirement date that he - he requested.” Urrutia depo. at 59. The safety concern was “[w]e did not know the fitness of the employee for duty.” Id. at 60. Urrutia also stated, “We were trying to get him back to work, but, first, we had to understand his fitness for duty.” Docket no. 43-1 at 117 (Urrutia depo.).

Urrutia also testified, “Mesa because he submitted his retirement, circumstances we already discussed about, you know, the inconsistencies [between the two medical releases], we decided that, you know, instead of going through the Corrective Action Policy we - we - we take an unpaid leave approach and let the employee retire without any interruption of his employment. That’s why we did that.” Docket no. 43-1 at 124-25. Urrutia also stated that the unpaid leave was imposed because Mesa “failed to report as requested by the company to get his fitness for duty.” Urrutia depo. at 60. Urrutia could not recall what Castaneda had told him about why Mesa did not report. Urrutia depo. at 60. The length of the unpaid leave was based on Mesa’s intent to retire date of December 1, 2016. Docket no. 43-1 at 127 (Urrutia depo.).

Harris-Rowland testified that Mesa was placed on unpaid personal leave (not suspended) because “[t]here was concern about his safety and so he was not returned to his business area,” though she was unable to provide any specifics, and she later testified that she did know of any reason that Mesa was being placed on unpaid leave other than his failure to report for the human performance evaluation. Docket no. 43-1 at 132, 140. She testified that failure to report for the evaluation could be considered a safety issue or a failure to follow instructions. Id. at 140.

Castaneda could not recall who made the decision. Castaneda depo. at 22. Urrutia testified that “power generation (myself), our safety, HR, legal team, and my business unit leader” were involved in the decision to put Mesa on unpaid leave and “this was the decision that was made by that joint team.” Urrutia depo. at 57-58. Harris-Rowland testified that Urrutia was not the sole decisionmaker, but she could not give specifics on who else was involved. Docket no. 43-1 at 138. Lisa Lewis, CPS Energy’s Vice President of People and Culture, submitted an affidavit stating that she was also involved in the September 29 decision to place Mesa on unpaid leave and that “he was placed on unpaid leave solely because he failed to attend an examination that was required due to conflicting medical releases received.” Docket no. 41-23. She further attested, “Because this was a unique circumstance, particularly with Mr. Mesa’s upcoming retirement on December 1, 2016, CPS Energy’s corrective action policy did not apply.” Id. There is no evidence that Drennan participated in the decision.9

*9 It is undisputed that the Corrective Action Policy was not applied. The Corrective Action Policy states that its process “will be administered when a problem is not serious enough to warrant immediate termination” and includes formal corrective actions of Reminder 1 (for minor violations or deficiencies), Reminder 2 (for serious violations and deficiencies), Reminder 3 (for major violations and deficiencies that constitute some degree of threat to the operation of the organization or to the safety of employees and includes a one-day unpaid suspension), and Final Warning (appropriate for an additional infraction occurring during the active period of a Reminder 3 and includes a three-day unpaid suspension). Docket no. 43-1 (Ex. 31).10

Harris-Rowland prepared a critical issues activity report on September 30, which stated, “Determination to separate employee after he did not report for HPE. A. Mesa sent home on paid leave by R. Urrutia pending MRI however, this cannot be done since WC case is closed. Mesa will be sent for new FFD.” Docket no. 43-1 at 169. Harris-Rowland testified that she just reported what Urrutia had told her. Docket no. 43-1 at 135.11 Castaneda testified that there was never a plan to set up a new HPE after September 29. Docket no. 43-1 at 181. Thus, this appears to summarize that Mesa had previously been sent home on paid leave on September 21 pending an MRI (that the evidence indicates that Castaneda, Urrutia, and Bonewell wanted him to get, but that could not be done under worker’s compensation) and that he was then sent for a new fitness-for-duty exam. It then states that a decision was made (at the September 29 meeting) to separate Mesa after he did not report for his human performance evaluation on September 29. Mesa contends that the use of the word “separate” indicates that he was fired.

When Plaintiff arrived at Concentra Clinic on Friday September 30 for the human performance evaluation, he was informed that he would not be attended to because he was supposed to be there Thursday. Mesa depo. at 172. Mesa was directed to call Harris-Rowland and given a phone number. Id. at 172-73. Mesa called her immediately and she got “in contact with Rick [Urrutia] and Trish [Villa], and they decided for [Mesa] to meet them on [October 3, 2016.]” Mesa depo. at 173-74. Harris-Rowland also informed Plaintiff that he was supposed to be at Concentra on Thursday, September 29, and Mesa responded that he had been told to go Thursday or Friday and had chosen Friday. Id. at 174-75.

At the October 3 meeting, Mesa met with Urrutia, Patricia Villa, and Harris-Rowland. Mesa depo. at 176. Urrutia read the contents of a letter to Mesa. Id. at 189; docket no. 41-13. The letter stated that, effective October 3, he would be placed on unpaid personal leave through November 29, 2016, and that the decision was based on his failure to report for the requested human performance evaluation on September 29. Mesa depo. at 189-90. The letter stated that Mesa was required to return his employee badge, keys, phones and other CPS Energy property in his possession, that his “employment relationship will end on November 29, 2016, as requested in your retirement election,” and that the “unpaid personal leave will have no impact on any workers’ compensation, disability or retirement benefits.” Docket no. 41-24.

*10 Mesa testified that he told them what they were doing was not right. Mesa depo. at 181. He testified that he also said, “This is all y’all have to say? ... None of y’all is going to say nothing?” and “After being there 26 years, missing - missing birthday parties with my kids, missing Thanksgiving with my kids, Christmases with my kids, this is how y’all pay me back for coming to work every day? This is - This is how y’all thank me? That’s how the - This is it?” Mesa depo. at 181. He did not tell them he did not want to retire. Id. at 191-92. Mesa states that he was not paid and his insurance was dropped during the leave, and that he felt he was fired. Mesa depo. at 190. He also testified that he was forced to retire. Id. at 191. He never tried to get his job back because he felt it would be futile. Mesa never filed a grievance under CPS Energy’s grievance procedures.

Urrutia testified that Mesa was not separated, but was placed on unpaid leave on October 3 and “employment was completed at his retirement date.” Urrutia depo. at 50. He also stated that Mesa was employed by the company but on unpaid leave, and “this was the decision that was made by [the] joint team.” Urrutia depo. at 58. Harris-Rowland also testified that Mesa was never separated during the leave and that it was a determination that he was not returning to the work location. Docket no. 43-1 at 136-37.

Mesa applied for unemployment benefits with the Texas Workforce Commission, stating that he had been fired. Notice was mailed to CPS on October 5, 2016. On October 17, Harris-Rowland told the TWC that Mesa was still employed but was placed on unpaid personal leave until November 29, 2016 and that he would be separated on his December 1 retirement date. Docket no. 43-1 at 160. On October 6, in response to an email discussion about coding Mesa’s time, Harris-Rowland wrote, “This is not a suspension.” Docket no. 43-1 at 190. She also wrote, “Please make sure that A. Mesa is coded Personal Non-paid as of yesterday, Oct. 3, 2016.” Docket no. 43-1 at 191. On October 12, Harris-Rowland sent an email stating, “Abel Mesa was placed on personal unpaid leave on Oct. 3, 2016 through November 29, 2016. It appears the Leave team entered 12 hours of leave for Oct. 10, 2016 because it was a pending FML request for time off (see attached Reed notice). Please make sure that Mr. Mesa does not get paid for any leave for Oct. 10, 2016.” Docket no. 43-1 at 192.12

On November 4, 2016, Mesa and his spouse met with Robinson to review different retirement options and select the options they wanted. Docket no. 41-2 ¶ 8. During this meeting, Mesa never told Robinson that he did not want to retire or that he wanted to rescind his stated intent to retire. Mesa depo. at 195-197. Mesa and his wife signed all documents necessary to finalize his retirement effective December 1, 2016. Docket no. 41-2 ¶ 8. At no time did Mesa inform the Employee Benefits Department that he did not intend to retire when he sent the September 20 email. Docket no. 41-2 ¶ 8. Mesa testified that he did not communicate that he did not want to retire because he “didn’t think [he] had a leg to stand on” and to him, it was over. Mesa depo. at 197.

In April and May 2017, Plaintiff filed complaints with the Equal Employment Opportunity Commission and the Texas Workforce Commission Civil Rights Division. Plaintiff filed his Complaint with this Court on July 19, 2017, and his Second Amended Complaint on January 9, 2018. Docket no. 1, Docket no. 29. Mesa began working full time for Aldez Containers in October 2017 making $11.50 per hour, when he had been making over $40 per hour at CPS Energy. Mesa depo. at 19.

*11 In his Second Amended Complaint, Plaintiff brings claims for disability discrimination under the Rehabilitation Act of 1973; disability discrimination under the ADA based on (1) his own actual disability, (2) being regarded as disabled, and (3) his association with his disabled wife; age discrimination under the ADEA; and retaliation under the FMLA for taking leave for himself and to care for his wife. Docket no. 29 ¶¶ 34-58. In response to Defendant’s motion, Plaintiff concedes his claims under the Rehabilitation Act, under the ADA because of his own disability, and under the FMLA related to leave for his own health condition. Docket no. 43 at 1.

The following claims still remain: (1) disability discrimination in violation of the ADA based on the theory that Defendant regarded Plaintiff as disabled; (2) disability discrimination in violation of the ADA based on the theory that Defendant’s adverse actions were motivated by Plaintiff’s association with his disabled wife; (3) retaliation in violation of the FMLA for Plaintiff’s use of benefits to care for his disabled wife; and (4) age discrimination in violation of the ADEA.

ANALYSIS

I. Summary Judgment Standard

Summary judgment is proper when the evidence shows “that there is no genuine dispute as to any material fact and the movant is entitled to judgement as a matter of law.” FED. R. CIV. P. 56(a); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250-52 (1986). A dispute of a material fact is “genuine” if the evidence is such that a reasonable jury could return a verdict in favor of the nonmoving party. Anderson, 477 U.S. at 248. Rule 56 “mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails ... to establish the existence of an element essential to that party’s case and on which that party will bear the burden of proof at trial.” Curtis v. Anthony, 710 F.3d 587, 594 (5th Cir. 2013) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) ).

The Court must draw reasonable inferences and construe evidence in favor of the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). Although the evidence is viewed in the light most favorable to the nonmoving party, a nonmovant may not rely on “conclusory allegations, unsubstantiated assertions, or only a scintilla of evidence” to create a genuine issue of material fact sufficient to survive summary judgment. Freeman v. Tex. Dep’t of Criminal Justice, 369 F.3d 853, 860 (5th Cir. 2004). The court “may not make credibility determinations or weigh evidence” in ruling on a motion for summary judgment. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 120 (2000); Anderson, 477 U.S. at 254-55.

II. Disability Discrimination under the ADA

Plaintiff asserts two claims under the ADA: (1) that he was discriminated against because Defendant regarded him as disabled and (2) he was discriminated against for associating with his disabled wife. Defendant contends that Plaintiff cannot satisfy his prima facie burden for either claim because he cannot establish that he was “regarded as” disabled and he cannot establish that association with his wife was a motivating factor in his suspension. Docket no. 41 at 11-15. Defendant further contends that, even if Mesa can establish a prima facie case, it has provided a legitimate, non-discriminatory reason for the adverse employment action - Mesa’s failure to appear for the required fitness for duty exam - and he has no evidence to show that this reason is pretextual because the relevant decisionmakers all believed he had missed the appointment.

A. Plaintiff’s Regarded as Disabled Claim

*12 In order to make out a prima facie showing under the McDonnell Douglas framework for the claim that he was discriminated against because Defendant regarded him as disabled, Mesa must show that: (1) he was regarded as disabled (as described in 42 U.S.C. § 12102(3) ); (2) he was qualified for the job; and (3) he was subject to an adverse employment decision on account of the perception of disability. Cannon v. Jacobs Field Servs., N.A. Inc., 813 F.3d 586, 590 (5th Cir. 2016); 42 U.S.C. § 12102(1). For purposes of this motion, it is undisputed that Mesa was qualified for the job. Mesa asserts he was subject to two adverse employment actions on account of the perception of disability - a suspension and a termination. Docket no. 43 at 17. Placement on involuntary leave and termination are adverse actions under the ADA regulations. 29 U.S.C. § 1630.2(l). CPS Energy challenges the first element of the prima facie case.

(1) transitory and minor defense

CPS Energy first moves for summary judgment on the basis that Mesa was not regarded as disabled as defined in 42 U.S.C. § 12102(3) because his impairment was transitory and minor. The ADA states that the term “disability” means “being regarded as having such an impairment (as described in paragraph (3) ).” 42 U.S.C. § 12102(1)(C). Paragraph (3) states that, for purposes of being regarded as having an impairment, “an individual meets the requirements of ‘being regarded as having such an impairment’ if the individual establishes that he or she has been subjected to an action prohibited under this chapter because of an actual or perceived physical or mental impairment whether or not the impairment limits or is perceived to limit a major life activity.” 42 U.S.C. § 12102(3)(A). “Physical or mental impairment” means “any physiological disorder or condition ... affecting one or more body systems, such as neurological, musculoskeletal, etc.” 29 C.F.R. § 1630.2(h). This change in the definition of “regarded as” disabled was part of the Americans with Disabilities Amendments Act (“ADAAA”) of 2008. Thus, although an actual disability is a physical or mental impairment that substantially limits one or more major life activities, an individual can now be “regarded as” disabled when he is subjected to a prohibited action because of a impairment, whether or not the impairment limits or is perceived to limit a major life activity.

However, paragraph (3) further states, “Paragraph (1)(C) shall not apply to impairments that are transitory and minor. A transitory impairment is an impairment with an actual or expected duration of 6 months or less.” Id. § 12102(3)(B). The statute does not define a “minor” impairment. The regulations and EEOC guidance indicate that “transitory” and “minor” are separate and distinct requirements.

Thus, it is clear that, under the “regarded as” prong, a plaintiff is not required to show that he is substantially limited in a major life activity or that the employer perceived him as being substantially limited in a major life activity. Cannon, 813 F.3d at 591-92 (noting that the ADAAA overrules prior authority requiring a plaintiff to show that the employer regarded him or her as being substantially limited in a major life activity); 29 C.F.R. § 1630.2(j)(ix) (whether an individual’s impairment substantially limits a major life activity is not relevant to coverage under the “regarded as” prong). Nevertheless, the ADA also makes clear that the “regarded as” prong “shall not apply to impairments that are transitory and minor.” 42 U.S.C. § 12102(3)(B). CPS Energy contends that Mesa testified that he fully recovered from his shoulder injury within eight days, meaning his impairment was transitory and minor. Docket no. 41 at 13.

As this Court has previously noted, whether the plaintiff must prove that the impairment was not transitory and minor, or whether the transitory and minor nature of the impairment is a defense, is not entirely clear from the statutory language. Dube v. Tex. Health & Human Servs, No. SA-11-CV-354-XR, 2011 WL 4017959, at *2 (W.D. Tex. Sept. 8, 2011) (“[T]he ADA is somewhat ambiguous regarding the burden of proof on the issue of whether an impairment is transitory and minor.”). However, the regulations place the burden of proof on the employer and explain its application:

*13 It may be a defense to a charge of discrimination by an individual claiming coverage under the ‘regarded as’ prong of the definition of disability that the impairment is (in the case of an actual impairment) or would be (in the case of a perceived impairment) ‘transitory and minor.’ To establish this defense, a covered entity must demonstrate that the impairment is both ‘transitory’ and ‘minor.” Whether the impairment at issue is or would be ‘transitory and minor’ is to be determined objectively. A covered entity may not defeat ‘regarded as’ coverage of an individual simply by demonstrating that it subjectively believed the impairment was transitory and minor; rather, the covered entity must demonstrate that the impairment is (in the case of an actual impairment) or would be (in the case of a perceived impairment) both transitory and minor. For purposes of this section, ‘transitory’ is defined as lasting or expected to last six months or less.

29 C.F.R. § 1630.15(f).

Based on the regulations, this Court has previously concluded that the employer must prove as a defense that the impairment was transitory and minor. Dube, 2011 WL 4017959, at *2. The Fifth Circuit has cited this Court’s later opinion in Dube with approval, and has clearly stated that the plaintiff “need only show that her employer perceived her as having an impairment.” 798 F.3d 222, 230 (5th Cir. 2015); see also Cannon v. Jacobs Field Servs. N.A., 813 F.3d 586, 591 (5th Cir. 2016); Dube v. Tex. Health & Human Servs. Comm’n, No. SA-11-CV-354, 2012 WL 2397566, at *3 (W.D. Tex. June 25, 2012).13

Citing Willis v. Noble Environmental Power, LLC, 143 F. Supp. 3d 475, 484 (N.D. Tex. 2015), CPS Energy argues that the fact that Mesa testified that he fully recovered from his shoulder injury within eight days, with no limitations in his mind,14 means that the short-term nature of his injury defeats his “regarded as” claim as a matter of law. In Willis, the plaintiff suffered a medical episode of dehydration and possible heat stroke and had difficulty walking, seeing, and communicating. Afterward, his employer discussed the episode and concerns about plaintiff working on wind turbines, which required the plaintiff to climb in excess of 300 feet and work in extreme temperatures in the summer. The district court granted summary judgment on the plaintiff’s actual disability claim because he failed to show that his impairment substantially limited a major life activity. It also granted summary judgment on his “regarded as” claim on the basis that an objective review of the record revealed that the plaintiff’s dehydration episode was transitory and minor because the episode lasted only a few hours, and he then received a clean bill of health with no work restrictions.

In response, Mesa argues that CPS Energy perceived him as having a substantially limiting impairment15 because they determined that Mesa posed a potential safety hazard and wanted Mesa to get an MRI. Mesa argues that the correct focus is not whether Mesa’s actual injury was mild, but whether Mesa was perceived as and treated as impaired. Mesa’s argument is that CPS Energy perceived him to have a continuing substantial impairment, that it suspended and then involuntarily retired him based on that perception, and that the nature of his actual impairment is irrelevant. In reply, CPS Energy argues that Mesa provides no evidence to conclude that anyone associated with CPS Energy regarded Mesa’s shoulder injury as anything other than transitory and minor, insofar as no one ever made a comment that they thought he was disabled or would not recover, and he did in fact recover quickly.

*14 The “regarded as” prong requires the individual to establish that he “has been subjected to an action prohibited under this chapter because of an actual or perceived” impairment. 42 U.S.C. § 12101(3)(A). Because it is undisputed that Mesa was not impaired at the time the adverse employment actions were taken, Mesa’s claim is that the adverse employment actions were taken because of a perceived impairment. Under the regulations, CPS Energy must demonstrate that the perceived impairment would be both transitory and minor. In other words, when the “regarded as” disabled claim is based on an alleged perceived impairment, the “transitory and minor” inquiry “is not about Plaintiff’s actual impairment, but the impairment perceived by his employer.” Davis v. Vt. Dept. of Corrections, 868 F. Supp. 2d 313, 326 (D. Vt. 2012); see also Nevitt v. U.S. Steel Corp., 18 F. Supp. 3d 1322, 1329-31 (N.D. Ala. 2014) (regulations did not support defendant’s contention that the court should determine whether the actual impairment was transitory and minor instead of whether defendant perceived employee to suffer from an impairment that was transitory and minor); Lewis v. Fl. Default Law Group, P.L., No. 8:10-cv-1182-T-27EAJ, 2011 WL 4527456 (M.D. Fla. Sept. 16, 2011) (“The ‘transitory and minor’ exception to the ‘regarded as prong’ focuses on the perceived impairment itself and not the condition giving rise to such impairment.”).

This is illustrated in the EEOC’s interpretive guidance as follows:

[A]n employer that terminated an employee with an objectively “transitory and minor” hand wound, mistakenly believing it to be symptomatic of HIV infection, will nevertheless have “regarded” the employee as an individual with a disability, since the covered entity took a prohibited employment action based on a perceived impairment (HIV infection) that is not “transitory and minor.”

29 C.F.R. pt. 1630 App. § 1630.2(l). This example is easy to comprehend and apply because the actual impairment and the perceived impairment are different, and the perceived impairment (HIV) would always be considered objectively not transitory and minor. The concept and analysis are more difficult when the actual impairment and the perceived impairment are of the same nature, as in this case, and when the impairment (shoulder injury) cannot be viewed categorically to determine whether it is objectively transitory and minor.

Thus, even though Mesa had an actual impairment that CPS Energy argues was transitory and minor, the proper standard for his “regarded as” claim in this case is one for a perceived impairment, and the proper inquiry is whether CPS Energy has demonstrated that the perceived impairment (shoulder injury) would be both transitory and minor. Although whether the employer perceived an impairment (and what it was) is necessarily subjective because it looks to the employer’s perceptions, the regulations state that whether the perceived impairment would be transitory and minor is evaluated objectively. This means that the relevant inquiry is whether the shoulder injury perceived by CPS Energy to exist would be objectively transitory and minor, not by determining whether CPS Energy subjectively perceived or believed that Mesa’s shoulder injury was transitory and minor. Saley v. Caney Fork, LLC, 886 F. Supp. 2d 837, 851 (M.D. Tenn. 2012) (citing 29 C.F.R. § 1630.2(l) App. (2011) ); see also Budhun v. Reading Hosp. & Med. Ctr., 765 F. 3d 245, 259 (3d Cir. 2014) (“[T]he relevant inquiry is whether the impairment that the employer perceived is an impairment that is objectively transitory and minor.”).

CPS Energy primarily argues that Mesa’s actual injury was transitory and minor and that Mesa has presented “no evidence from which [to] conclude that anyone associated with CPS Energy regarded Mesa’s shoulder injury as anything other than transitory and minor” or “made a determination he was or would be impaired longer than six months” Docket no. 44 at 2-3. But, as discussed above, neither is the correct focus. In its Reply, CPS Energy addresses Mesa’s argument that because decisionmakers viewed him as a potential safety hazard and wanted a fitness-for-duty exam, they regarded him as impaired under the ADA, arguing that its legitimate concerns about Mesa’s ability to work and its desire to determine whether he had any work restrictions are insufficient to infer that it regarded him as having an impairment for purposes of the “regarded as” prong. Docket no. 44 at 3. Instead, CPS Energy argues, it “had legitimate reasons to verify Mesa’s ability to work safely and to determine whether he had any work restrictions at all.” Id.

*15 But Mesa does not argue that the fact that CPS Energy wanted him to have a fitness for duty exam alone means that it regarded him as disabled. Mesa points to the fact that decisionmakers wanted him to have an MRI and that they had concerns about his ability to do the job, and to do it safely. The EEOC’s Interpretive Guidance states: “[A]n employer who terminates an employee with angina from a manufacturing job that requires the employee to work around machinery, believing that the employee will pose a safety risk to himself or others if he were suddenly to lose consciousness, has regarded the individual as disabled.” 29 C.F.R. pt. 1630, App. § 1630.2(l) (2016). Based on this guidance, the Southern District of Illinois district court stated, “it is enough under the ‘regarded as’ prong to show that an employer took an action because it believed, rightly or wrongly, that [the employee] would be a safety risk.” Equal Employment Opportunity Comm’n v. Amsted Rail Co., Inc., 280 F. Supp. 3d 1141, 1150 (S.D. Ill. 2017) (citing 29 C.F.R. pt. 1630, App. § 1630.2(l) (2016) ). As an Eleventh Circuit panel recently explained, the Interpretive Guidance reflects the common-sense principle that if an employer takes adverse action because it fears the consequences of the employee’s medical condition, it has regarded the employee as disabled. Lewis v. City of Union City, 877 F.3d 1000, 1012 (11th Cir. 2017), vacated on motion for reh’g en banc, 893 F.3d 1352 (2018).

The ADA is clear that an individual meets the requirement of being regarded as having an impairment if he establishes that he has been subject to a prohibited action because of a perceived physical impairment, whether or not the impairment limits or is perceived to limit a major life activity. 42 U.S.C. § 12102. The only exception is that set forth in 42 U.S.C. § 12102(3)(B) - impairments that are transitory and minor. Whether the employee actually was a safety risk would be a separate inquiry under the qualification inquiry or the direct threat defense. Amsted, 280 F. Supp. 3d at 1150; 29 C.F.R. § 1630.2(l)(3) (establishing that an individual was regarded as having an impairment does not, by itself, establish liability).

The regulations reflect this structure. Section 1630.2(l) states that “[e]xcept as provided in § 1630.15(f) [the transitory and minor defense], an individual is ‘regarded as having such an impairment’ if the individual is subjected to a prohibited action because of an actual or perceived physical or mental impairment, whether or not that impairment substantially limits, or is perceived to substantially limit, a major life activity” and “[e]xcept as provided in § 1630.15(f), an individual is ‘regarded as having such an impairment’ any time a covered entity takes a prohibited action against the individual because of an actual or perceived impairment, even if the entity asserts, or may or does ultimately establish, a defense to such action.” Prohibited actions include placement on involuntary leave, termination, and exclusion for failure to meet a qualification standard. 29 C.F.R. § 1630.2(l)(1).

Thus, whether CPS Energy rightly had concerns about Mesa’s ability to work or whether it rightly required him to get a human performance evaluation are not the proper inquiries for purposes of CPS Energy’s motion for summary judgment on Mesa’s prima facie case, which is based solely on the transitory and minor defense. The proper inquiry is whether, at the time of the adverse action, CPS Energy perceived Mesa to have a physical impairment (a shoulder injury) that, viewed objectively, would be transitory and minor.16

*16 Mesa has provided sufficient evidence to raise a fact issue as to whether CPS Energy perceived him to have a physical impairment - a shoulder injury - at the time it placed him on unpaid leave until his stated retirement date. It is undisputed that CPS Energy decisionmakers knew that Mesa had a shoulder injury that required him to be transported to the emergency room by ambulance. CPS Energy received the Texas Workers’ Compensation Work Status Report dated September 13 from Texas MedClinic, which included the “employee’s description of injury/accident” as “Left Shoulder Sprain” and “work injury diagnosis information” of “left shoulder sprain/strain.” Docket no. 41-10. It allowed the “employee to return to work as of 9/13/2016 with the restrictions identified in Part III, which are expected to last through 09/16/2016.” Docket no. 41-10. The restrictions were specific to the left hand/wrist and included no climbing, no reaching, no overhead reaching, automatic transmission only, no lifting/carrying, and “must take prescription medication(s).” Id. It included “expected follow-up services” of “evaluation by the treating doctor” on September 16. Id.

As Castaneda testified, “[t]he employee sustained injuries that required restrictions that were very specific, in addition to prescription medications.” Castaneda depo. at 17. To accommodate these restrictions, Harris-Rowland prepared a light duty position offer. Docket no. 41-11. On September 20, Nova Clinic sent a report listing the diagnosis as “Sprain of ligaments of cervical spine” and “Contracture of muscle, LEFT shoulder.” This report had no restrictions and stated it was “the last scheduled visit for this problem” and that “no further medical care is anticipated.” Docket no. 41-15. This information was relayed to Drennan and Urrutia. Docket no. 41-16.

However, Castaneda testified that, even after they received the second report, there were still concerns about what Mesa’s abilities were, to make sure he could do the job. Castaneda depo. at 17, 23. There was discussion about whether Mesa should get an MRI and Castaneda testified that they wanted him to get one. CPS Energy decided that he needed a fitness-for-duty examination “to ensure he was able to do the minimum requirements of the job.” Castaneda depo. at 18. Urrutia also testified that they wanted to make sure that Mesa was fit to return to work and did not pose a safety threat. Urrutia depo. at 42. This is some evidence that CPS Energy still viewed Mesa as having a physical impairment after September 20, despite the fact that Mesa was no longer impaired.

In addition, after Mesa did not obtain the fitness for duty evaluation, the conference call participants still “had concerns about his well-being.” Castaneda depo. at 20. Although CPS Energy contends that the sole reason for placing Mesa on unpaid leave was his failure to attend the human performance evaluation, Urrutia stated that the decision to put him on unpaid leave was based in part on “the fact that we’re concerned about the safety of the employee.” Urrutia depo. at 59. Harris-Rowland testified that the failure to attend the evaluation could be viewed as a disciplinary issue (failure to follow instructions) or as a safety issue. Docket no. 43-1 at 140. This is some evidence that CPS Energy continued to view Mesa as impaired, and that it viewed him as impaired at the time it placed him on unpaid leave on or about September 29 or 30, and that its decision was based at least in part on that perception. Thus, a material issue of fact exists as to whether CPS Energy perceived Mesa as having a physical impairment at the time of the adverse employment action.

To obtain summary judgment on its “transitory and minor” defense, CPS Energy must show that there is no genuine dispute of material fact that it perceived Mesa as having a physical impairment (shoulder injury) that was objectively transitory and minor. In other words, it must prove as a matter of law that the shoulder injury it perceived Mesa to have, viewed objectively, was transitory (lasting less than six months) and minor. See Gaus v. Norfolk S. Ry. Co., No. 09-1698, 2011 WL 4527359, at *17 (W.D. Pa. Sept. 28, 2011).

*17 Some impairments can be categorized as a whole (i.e., categorically) as objectively transitory and minor or not. For example, bipolar disorder, HIV, and alcoholism are, categorically, objectively not transitory and minor, while cuts and short-term illnesses such as a cold or the flu are, categorically, transitory and minor. See FED. DISCRIM. LAWS, Disability Discrimination in the Workplace, § 4.12; Saley v. Caney Fork, LLC, 886 F. Supp. 2d 837, 851 (M.D. Tenn. 2012); Lewis v. Fl. Default Law Group, No. 8:10-cv-1182-T-27EAJ, 2011 WL 4527465, at *6 (M.D. Fl. Sept. 16, 2011) (citing House Judiciary Committee Report that the transitory and minor exception was to exclude individuals who are regarded as having common ailments like the cold or flu to conclude that the flu is objectively transitory and minor); Valdez v. Minnesota Quarries, Inc., No. 12-CV-0801 (PJS/TNL), 2012 WL 6112846, at *3 (D. Minn. Dec. 10, 2012) (“the legislative history cites seasonal flu as the paradigmatic example of a transitory and minor ailment”).

Impairments such as physical injuries are difficult to classify categorically because the nature of such injuries varies. The regulations indicate that a physical injury such as a back injury may be minor, but certainly not all back injuries (or other physical injuries) are minor such that they may be treated categorically as minor or not. Some shoulder injuries may be not only more than “transitory and minor,” but actually disabling. In Cannon v. Jacobs Field Servs., N.A., Inc., 813 F.3d 586, 590-91 (5th Cir. 2016), the Fifth Circuit held that a plaintiff with rotator cuff injury that prevented him from lifting his right arm above the shoulder qualified as actually disabled because he was substantially limited in the major life activities of lifting and reaching.

There is no Fifth Circuit guidance defining “minor” impairment. Non-minor cannot require substantially limiting a major life activity, because that requirement was eliminated from “regarded as” coverage. Willis states that “[a]n impairment that subsides within a few hours, requires minimal recuperation time and no continuing treatments or restrictions is clearly both transitory and minor.” Willis, 143 F. Supp. 3d at 484. Another court has stated that “broken bones, generally, are characterized as being ‘transitory and minor’ for purposes of ADA disability definitions.” Clark v. Boyd Tunica, Inc., No. 3:14-cv-00204-MPM-JMV, 2016 WL 853529, at *6 (N.D. Miss. Mar. 1, 2016).

Some district courts have treated injuries similar to Mesa’s (or even more substantial) as transitory and minor. In Quick v. City of Fort Wayne, No. 1:15-CV-056 JD, 2016 WL 5394457 (N.D. Ind. Sept. 27, 2016), the plaintiff suffered a back injury and argued that the City regarded him as disabled when it terminated him. The district court evaluated whether the impairment was transitory and minor, citing cases holding that when the plaintiff suffers an acute injury and then makes a swift and complete recovery, it is a minor injury. Although the plaintiff alleged that the back injury was extremely painful, the Court noted that he recovered within a month and held that no reasonable juror could conclude that his back injury was other than transitory and minor, precluding recovery under the “regarded as” prong.

In Weems v. Dallas Independent School District, 260 F. Supp. 3d 719 (N.D. Tex. 2017), the plaintiff suffered a significant knee injury requiring surgery, the use of a scooter, and eventually the use of a cane. The district court concluded that the plaintiff was not actually disabled, and also rejected the plaintiff’s “regarded as” claim. Id. at 730. However, the court’s analysis at one point incorrectly focused on whether the defendant “regarded Weems as being disabled” as opposed to whether it regarded him as having an impairment. Id. It found the impairment to be transitory and minor because the plaintiff returned to work within days after his surgery, used only two days of leave in the next four months, and had workplace restrictions for only three months. Id. This Court questions whether such an impairment - a knee injury requiring surgery, a scooter, use of a cane, and workplace restrictions - is objectively minor.

*18 Even assuming that Mesa’s perceived shoulder injury was transitory, CPS Energy has not conclusively shown that it was minor. It is undisputed that the injury resulted in Mesa being transported to the emergency room by ambulance. As Castaneda himself testified, the injury resulted in specific restrictions (no climbing, no reaching, no lifting) and prescription pain medications. There is some evidence that decisionmakers viewed these restrictions and medication requirements as continuing, since they wanted him to get an MRI, and were concerned about whether he could perform the physical demands of his job and whether he posed a safety risk. Thus, there is some evidence that the impairment CPS Energy perceived had restrictions on climbing, reaching, and lifting. In Cannon, the Fifth Circuit held that an employer’s belief that an applicant’s shoulder injury resulted in substantial impairment limiting the ability to lift and reach (which are major life activities) in his right arm (and that was actually disabling), was sufficient for “regarded as” coverage. Cannon, 813 F.3d at 586.

Mesa has provided sufficient evidence to raise a fact issue that CPS Energy continued to view him as having a physical impairment that precluded his ability to climb, reach, and/or lift. If such an impairment is sufficient to qualify one as actually disabled, it logically follows that such an impairment is non-minor. At the very least, Mesa has produced some evidence that a reasonable person could view the perceived shoulder injury as non-minor. Thus, the Court finds that CPS Energy has failed to meet its summary-judgment burden of proving that the impairment was both transitory and minor, and summary judgment on that basis is denied.

(2) legitimate non-discriminatory reason and pretext

CPS Energy also moves for summary judgment on the basis that it has provided a legitimate, non-discriminatory reason for its actions - Mesa’s failure to attend a required fitness for duty exam -- and that Mesa has failed to demonstrate pretext. If the plaintiff successfully establishes a prima facie case, the burden shifts to the employer to produce evidence that the adverse employment action was taken for a legitimate, nondiscriminatory reason. Cannon, 813 F.3d at 590. If the employer meets this burden, then the burden shifts to the plaintiff to establish that the reason provided by the employer is a pretext for discrimination. Id. In the summary-judgment context, the question is not whether the plaintiff proves pretext, but rather whether the plaintiff raises a genuine issue of fact regarding pretext. Caldwell v. KHOU-TV, 850 F.3d 237, 242 (5th Cir. 2017).17

*19 CPS Energy argues that, even if Mesa raised a fact issue about whether Castaneda told Mesa he could appear for the exam on either Thursday or Friday, Mesa does not dispute that the decisionmakers believed in good faith that Mesa failed to appear for the examination on the mandated date. CPS Energy further asserts that the fact that Mesa did not in fact intend to retire is irrelevant because he never told any of the decisionmakers that he did not want to retire and their decision to retire him on his selected date cannot be construed as false or pretextual. Docket no. 41 at 20-22; Docket no. 44 at 11-13. Alternatively, CPS Energy contends that Mesa can only recover damages up to December because the evidence conclusively shows that he was not forced to retire on December 1 and Mesa has not shown that he was constructively discharged.

Although Mesa’s deposition testimony asserts that he felt he was “fired” on October 3, his briefing more accurately reflects that he was subjected to two adverse employment actions - being placed on unpaid leave from October 3 to November 29, 2016, and being terminated (or involuntarily retired). Mesa has presented sufficient evidence to raise a fact issue as to whether he was placed on unpaid leave because he was perceived as impaired. As discussed above, there is some evidence that decisionmakers viewed Mesa’s shoulder injury and its resulting restrictions as continuing at the time they reached their decision, since they were concerned about whether he could perform the physical demands of his job and whether he posed a safety risk.

There is also some evidence that he was placed on unpaid leave for this very reason. Lewis’s affidavit states that “he was placed on unpaid leave solely because he failed to attend an examination that was required due to conflicting medical releases received.” Docket no. 41-23. But Castaneda testified that the participants “had concerns about [Mesa’s] well-being.” Castaneda depo. at 20. Urrutia testified that the decision was based on “the fact that Mr. Mesa did not show up to his assigned fitness for duty assigned by occupational health, the fact that we’re concerned about the safety of the employee, you know, he did submit his retirement, intent to retire on the 20th, so instead of corrective action process we decided to put him on unpaid leave and not interrupt his end - employment until his retirement date that he - he requested.” Urrutia depo. at 59. The safety concern was “[w]e did not know the fitness of the employee for duty.” Id. at 60. Urrutia also stated, “We were trying to get him back to work, but, first, we had to understand his fitness for duty.” Docket no. 43-1 at 117 (Urrutia depo.). Harris-Rowland testified that Mesa was placed on unpaid personal leave because “[t]here was concern about his safety and so he was not returned to his business area.” Thus, a reasonable construction of the evidence is that Mesa was not placed on leave as discipline for failing to attend the exam, but because his failure to attend the exam meant that the concerns about his well-being and ability to do the job were not alleviated, and that actions were taken because those concerns persisted.

The evidence further demonstrates that the decision of what action to take in regard to those continuing concerns was heavily, if not completely, influenced by Mesa’s stated intent to retire on December 1. Lewis stated that “[b]ecause this was a unique circumstance, particularly with Mr. Mesa’s upcoming retirement on December 1, 2016, CPS Energy’s corrective action policy did not apply.” Urrutia also testified, “Mesa because he submitted his retirement, circumstances we already discussed about, you know, the inconsistencies [between the two medical releases], we decided that, you know, instead of going through the Corrective Action Policy we - we - we take an unpaid leave approach and let the employee retire without any interruption of his employment. That’s why we did that.” Docket no. 43-1 at 124-25. Castaneda also stated that they were trying to get him to his retirement date. Castaneda depo. at 20. The evidence therefore shows that the decision to not apply the Corrective Action Policy but instead place him on unpaid leave until December 1 was based on the fact that Mesa had stated his intent to retire that date. Thus, although the form of the action taken and its duration was influenced by the fact that Mesa had stated an intent to retire, the evidence raises a fact issue as to whether that action was taken in the first place because Mesa was regarded as disabled. Thus, Plaintiff may proceed on his regarded as disabled claim as to his placement on unpaid leave.

*20 However, Mesa fails to raise a material issue of fact on whether he was “involuntarily retired” by CPS Energy because he was regarded as disabled. The evidence is clear that all of the CPS Energy decisionmakers believed that Mesa intended to and wanted to retire on December 1, 2016. The only person who Mesa contends may have known that he did not intend to retire was Drennan, and Mesa has failed to show that Drennan influenced or was involved in the decision to place him on unpaid leave and retire him.

Mesa contends that his September 9 email stating that he intended to retire but needed to talk to his broker to find the best option supports his claim that he did not intend to retire but did want information about available benefits. But Mesa sent an unequivocal email to his direct supervisor, copying employee benefits, on September 20 stating “My Intent to retire is December 1, 2016.” This is the procedure for initiating the retirement process on the CPS Energy website. Docket no. 41-31. Thus, as far as the decisionmakers were concerned, Mesa intended to and wanted to retire on December 1. Mesa fails to provide any evidence to cast doubt on the fact that decisionmakers retired him because of his stated intent to retire, even if they were mistaken because Mesa subjectively never intended to retire. Mesa also points to the fact that he sought new full-time work as proof that he did not intend to retire, but even if Mesa never wanted to or intended to retire, there is simply no basis for a reasonable jury to conclude that CPS Energy retired him for any reason other than because he had informed them of his intent to retire.

Although Plaintiff attempts to demonstrate pretext by arguing that CPS Energy has been inconsistent in stating why it acted, who made the decision, what Mesa’s status was while on unpaid leave, and whether he was retired, separated, or terminated, his evidence fails to establish pretext concerning the decision to retire him on December 1. Alleged inconsistencies about who made the decision and confusion about how to classify Mesa during his unpaid leave do not establish pretext as to the reason for the decision to retire Mesa effective December 1.

To demonstrate that Mesa was fired rather than retired, Plaintiff points to Harris-Rowland’s September 30 Critical Issues Report statement that a decision was made to separate Mesa, but Mesa was separated on December 1 pursuant to his intent to retire. Plaintiff states that “Defendant told the Texas Workforce Commission that Mr. Mesa had been fired.” Docket no. 43 at 19. But the exhibit page he cites is Mesa’s answers to questions about why he was fired and who told him he was fired, and contains no statements by Harris-Rowland that Mesa was fired. Docket no. 43-1 at 197 (Ex. 34 at bates no. D-597).18 Plaintiff notes another page of that exhibit that contains a statement from Harris-Rowland that states, “ON 100316 WE PUT HIM ON UNPAID LEAVE AND LATER TERMINATED HIM FOR NON COMPLIANCE.” Docket no. 43-1 at 201 (Ex. 34 at bates no. D-601). Plaintiff notes that Harris-Rowland also provided a document to TWC stating that Mesa was “still employed” while on unpaid leave.

*21 However, Defendants consistently asserted that Mesa remained employed while on unpaid leave and that his employment ended upon his selected retirement date. To the extent that one TWC document may contain a statement by Harris-Rowland after the fact that CPS Energy “terminated” Mesa instead of “separated” or “retired” him, any inconsistency in Defendant’s statements concerning the nature of the separation is simply too slim a reed upon which to resist summary judgment, given the overwhelming evidence that CPS Energy decisionmakers retired Mesa on December 1 consistent with his stated intent to retire, which they had no reason to question. See Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 148 (2000) (summary judgment may still be appropriate where the evidence creates at most only a weak issue of fact as to whether the employer’s reason was untrue).

Thus, the Court finds that Plaintiff has raised a fact issue as to pretext and may proceed on his claim that he was placed on unpaid leave from October 3 to November 29, 2016 because he was regarded as disabled, but he has failed to show pretext and may not proceed on his claim that he was involuntarily retired or fired. Summary judgment on his “regarded as” disabled claim is granted in part and denied in part.

B. Associational Disability - ADA

The ADA defines the term “discriminate against a qualified individual on the basis of disability” as including “excluding or otherwise denying equal jobs or benefits to a qualified individual because of the known disability of an individual with whom the qualified individual is known to have a relationship or association.” 42 U.S.C. § 12112(b)(4). The Fifth Circuit has not set forth the elements of an associational disability claim in a published opinion. However, in Grimes v. Wal-Mart Stores Tex., L.L.C., 505 F. App’x 376, 380 & n.1 (5th Cir. 2013), it stated that a prima facie case would require the plaintiff to show: (1) the plaintiff was qualified for the job; (2) the plaintiff was subjected to adverse employment action; (3) the employer knew of the employee’s disabled relative; and (4) the adverse employment action occurred under circumstances raising a reasonable inference that the disability of the relative was a determining factor in the employer’s decision. See also Spencer v. FEI, Inc., 725 F. App’x 263 (5th Cir. 2018); Besser v. Texas General Land Office, No. A-17-CV-1010-SS, 2018 WL 1353936 at *5 (W.D. Tex. Mar. 15, 2018).

For purposes of the motion, CPS Energy does not contest the first three elements, but contends that there is no evidence to raise a reasonable inference that Mesa’s wife’s cancer was a determining factor in the decision to place him on unpaid leave or retire him. Plaintiff contends that this Court should find that his wife’s disability was a determining factor in CPS Energy’s decision because (1) Harris-Rowland stated that Mesa “refused” to go to work on September 16 even though she would receive notification when Mesa was approved for FMLA, (2) Urrutia was suspicious of why Mesa moved the date of his MedClinic visit, and this suspicion “began less than two weeks after his use of FMLA,” (3) despite providing notice about his use of FMLA leave and following Defendant’s procedures, Mesa’s use of time off was viewed as suspicious and “Defendant demonstrated a negative attitude towards his use of that time off,” and (4) Defendant’s claimed reason is pretext. Docket no. 43 at 26.

The Court finds that Plaintiff fails to establish that his wife’s cancer was a determining factor in the decision to place him on unpaid leave and retire him. Mesa’s wife was diagnosed in 2013, and Mesa testified that he had no complaints about any events before 2016 and that no one ever mentioned or complained of any associated costs. Plaintiff does not show that any person at CPS made any negative comments or expressed any hostility toward Plaintiff’s wife’s cancer or his association with his wife. Nor did Defendant deny Plaintiff leave to take care of his wife. Plaintiff relies on Harris-Rowland’s comments about Plaintiff’s “refusal” to attend work and going to Houston to “have fun” and argues that this and the suspicion over his missed appointment demonstrates a negative attitude toward his use of time off. But Mesa agreed that Harris-Rowland did not know about his wife’s condition when she made the comment about going to Houston to “have fun,” and he had experienced no prior alleged negative effects despite his absences to care for his wife over a period of three-and-half years.

*22 The evidence shows that Defendants were confused about whether Mesa was supposed to be at work on September 16 and why Mesa rescheduled his MedClinic appointment and went to Nova Clinic, but this does not tend to demonstrate that Mesa’s wife’s cancer played a role in the adverse employment actions. Although Mesa testified that Harris-Rowland was upset that Mesa would not be coming in to accept the bona fide light duty employment offer as she had planned and she stated that Mesa refused to go to work to accept the offer, nothing indicates that any negative comments, perceptions, feelings, or actions were in any way “because of” Mesa’s wife’s cancer. At most, Mesa has shown that Harris-Rowland was upset that Mesa was taking leave rather than coming to work to accept her light duty offer, and under these circumstances, that is properly addressed in Mesa’s FMLA claim, not his disability association claim. The circumstances do not raise a plausible inference that his wife’s disability was a determining factor in the decision to place him on unpaid leave or retire him. Consequently, summary judgment is granted on this claim.

III. Retaliation under the Family Medical Leave Act

Mesa brings a claim for retaliation under the FMLA, alleging that CPS Energy retaliated against him for using FMLA benefits to care for his wife. Docket no. 43 at 23-25. The FMLA prohibits retaliation for the exercise of FMLA rights, including exercising the right to reasonable leave for medical reasons. Ray v. United Parcel Serv., 587 F. App’x 182, 186-87 (5th Cir. 2014). The McDonnell-Douglas burden-shifting framework applies to FMLA retaliation claims when the claim is based on circumstantial evidence.

To establish a prima facie case of retaliation under the FMLA, a plaintiff must show that (1) he engaged in protected activity; (2) the employer took a materially adverse action against him; and (3) a causal link exists between his protected activity and the adverse action. Wheat v. Florida ParishJuvenile Justice Comm’n, 811 F.3d 702, 705 (5th Cir. 2016); Mauder v. Metro. Transit Auth. of Harris Cty., 446 F.3d 574, 583 (5th Cir. 2006). If the plaintiff satisfies the initial burden, the burden shifts to the defendant to articulate a legitimate nondiscriminatory or nonretaliatory reason for the employment action. If the employer articulates such a reason, then the burden shifts to the plaintiff to prove by a preponderance of the evidence that the employer’s reason is pretextual.19

Defendant argues that Plaintiff cannot establish a prima facie case of FMLA retaliation because he cannot show that he was treated less favorably than an employee who had not requested leave under the FMLA or that Defendant took the adverse action because he took FMLA leave. Docket no. 41 at 16. Plaintiff has not attempted to show that he was treated less favorably than an employee who did not request leave under the FMLA. Thus, the issue is whether he has established a prima facie case that he was placed on unpaid leave or retired because he took FMLA leave.

“When evaluating whether the adverse employment action was causally related to the FMLA protection, the court shall consider the ‘temporal proximity’ between the FMLA leave and the termination.” Mauder v. Met. Transit Auth. of Harris Cty., Tex., 446 F.3d 547, 551 (5th Cir. 2006). Close proximity in time between FMLA leave and the adverse action may establish a minimal causal connection sufficient to carry Plaintiff’s burden. Clark v. Southwest Airlines Co., No. 1:16-CV-910-RP, 2017 WL 4853794, *5 (W.D. Tex. Oct. 26 2017); Garcia v. Penske Logistics, LLC, 165 F. Supp. 3d 542, 559 (S.D. Tex. 2014). CPS Energy placed Mesa on unpaid leave shortly after Plaintiff had requested and obtained FMLA leave to care for his wife.

*23 In addition, Mesa argues that Harris-Rowland was hostile to his use of FMLA leave and presents evidence that, despite knowing he took FMLA leave on September 16 to take his wife to the doctor in Houston, she sent an email and wrote that he “refused” to report to work that day to accept the bona fide offer. Harris-Rowland was involved in the meeting that led to the decision to place Mesa on unpaid leave. The evidence is sufficient to show that Mesa’s use of FMLA leave and the adverse employment action were not completely unrelated. Rodriguez v. Eli Lilly & Co., 820 F.3d 759, 766 (5th Cir. 2016) (citing Mauder v. Metro. Transit Auth. of Harris Cty., 446 F.3d 574, 583 (5th Cir. 2006) ).

CPS Energy’s motion for summary judgment on Plaintiff’s prima facie case of FMLA retaliation based on Mesa’s placement on unpaid leave is denied. However, for the same reasons discussed with regard to the ADA claim, summary judgment is granted on Mesa’s claims related to his alleged involuntary retirement because there is no reasonable basis from which to conclude that Mesa’s taking FMLA leave played any role in CPS Energy retiring him on December 1, 2016.

CPS Energy further contends that summary judgment is appropriate because it has proffered a legitimate, nondiscriminatory reason for placing Mesa on unpaid leave and Mesa has failed to demonstrate pretext. Defendant’s asserted reason for placing Mesa on unpaid leave was his failure to attend the human performance evaluation. However, Mesa has produced evidence that he had no prior disciplinary infractions and that, if viewed as a disciplinary violation, lesser sanctions under the Corrective Action Policy, including a short suspension, might have been applicable, but the Corrective Action Policy was not applied. Instead, decisionmakers placed him on eight weeks of unpaid leave, allegedly for missing the appointment, without even knowing why he missed the appointment. When an employer opts to have a disciplinary system that involves lesser sanctions, the employer’s failure to follow that system may give rise to inferences of pretext. Goudeau, 793 F.3d at 477.

The temporal link between Mesa’s use of leave, Harris-Rowland’s hostility to his leave and her participation in the decision, and the failure to apply a disciplinary system is sufficient to survive summary judgment on Mesa’s FMLA retaliation claim related to the unpaid leave. At summary judgment, evidence demonstrating that the employer’s explanation is false or unworthy of credence, taken together with the plaintiff’s prima facie case, is likely to support an inference of discrimination even without further evidence of defendant’s true motive. Goudeau, 793 F.3d at 476; Rodriguez v. Eli Lilly & Co., 820 F.3d 759, 765 (5th Cir. 2016). Summary judgment is granted on the FMLA retaliation claim based on the alleged termination, and denied as to placement on unpaid leave.

IV. Age Discrimination under the ADEA

Under the ADEA, it is unlawful to “discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s age.” 29 U.S.C. § 623(a)(1). To make a claim for age discrimination, Plaintiff must first establish a prima facie case of age discrimination. Goudeau v. Nat’l Oilwell Varco, L.P., 793 F.3d 470, 474 (5th Cir. 2015). To establish a prima facie claim under the ADEA related to a discharge, Plaintiff must show that (1) he was discharged; (2) he was qualified for the position; (3) he was within the protected class at the time of discharge; and (4) he was either (i) replaced by someone outside the protected class, (ii) replaced by someone younger, or (iii) otherwise discharged because of his age. Id.

*24 Plaintiff has failed to raise a material fact issue that he was discharged. As noted by CPS Energy, if he had been discharged, he would not be receiving full retirement benefits. However, even if the retirement is sufficient to establish discharge, he fails to show that he was “otherwise discharged because of his age.” As noted, there is no basis in the evidence to conclude that CPS Energy decisionmakers retired him on December 1 due to age discrimination. Though the fact that Mesa’s eligibility for retirement was correlated somewhat with his age (Mesa argues that an employee must be over age 40 to be retirement eligible), that does not render the decision made “because of” age.20

All of the objective evidence indicates that CPS Energy decisionmakers believed that Mesa intended to and wanted to retire on December 1, 2016. Mesa admitted that he never told anyone at any time that he did not want to retire or attempt to rescind his intent to retire. It may very well be true that Mesa never intended to retire and felt he had been fired on October 3 and thus felt it was pointless to attempt to argue that he did not want to retire. But that subjective belief is not enough to establish that CPS Energy discriminated against him because of his age when it retired him, as he had informed them he wished to do. There is simply no basis to reasonably conclude that CPS Energy discriminated against him on the basis of age when it retired him on December 1.

Defendant also moves for summary judgment on the unpaid leave, arguing that Mesa cannot establish the fourth element of the prima facie case - that he was placed on an unpaid leave of absence in October because of his age. Defendant notes that Mesa testified that “no one with CPS Energy ever said anything to [Plaintiff] that he thought was negative about his age,” nor could he “identify a single person with CPS Energy whom he believes discriminated against him on account of his age.” Docket no. 41 at 19 (citing Mesa depo. at 46, 68). Defendant argues that he has nothing other than his own general, unsupported, and speculative belief. Id.

Mesa attempts to establish a prima facie case of age discrimination based on his placement on unpaid leave on October 3. Mesa argues that “the adverse actions taken against [him], including not applying the disciplinary policy, were done because he was retirement eligible,” pointing to Urrutia’s testimony that Mesa’s retirement status was considered in the decision to place him on unpaid leave, and it was the reason they did not use the normal disciplinary corrective action policy. Plaintiff argues that Defendant discriminated against him because of his age “because age and retirement are inexorably linked.” Docket no. 43 at 22.

*25 However, as CPS Energy notes, Mesa improperly argues that he was discriminated against because he was “retirement eligible.” Although retirement eligibility alone is generally insufficient to prove age discrimination, Armendariz v. Pinkerton Tobacco Co., 58 F.3d 144, 152 (5th Cir. 1995), age discrimination may occur when pension status serves as a proxy for age, as in the case cited by Mesa, Hilde v. Cityof Eveleth, 777 F.3d 998, 1006 (8th Cir. 2015). However, the evidence here is that Mesa had expressed his intent to retire, not that he was simply eligible to retire. The fact that he could retire in part due to his age does not mean that CPS Energy’s decision based on Mesa’s stated intent to retire was because of his age. The Fifth Circuit has noted that “[t]here is a link between retirement and age, but it is not a necessary one.” Martin v. Bayland, Inc., 181 F. App’x 422 (5th Cir. 2006).

In addition, the Supreme Court has noted that, “as a matter of pure logic, age and pension status remain ‘analytically distinct’ concepts.” Ky. Retirement Sys. v. E.E.O.C., 554 U.S. 135, 143 (2008). The Court explained that “one can easily conceive of decisions that are actually made ‘because of’ pension status and not age, even where pension status is itself based on age.” Id. When the employer’s decision is wholly motivated by a factor other than age, age discrimination has not occurred, even if the motivating factor is correlated with age, as pension status typically is. Hazen Paper Co. v. Biggins, 507 U.S. 604 (1993). The undisputed evidence shows that Mesa was treated differently because he had stated an intent to retire in the near future, not because he was retirement-eligible or because of his age. Thus, Mesa fails to establish a claim for age discrimination and summary judgment is granted on this claim.

CONCLUSION

For the foregoing reasons, Defendant’s Motion for Summary Judgment (Docket no. 41) is GRANTED IN PART. Plaintiff’s claims under the Rehabilitation Act are DISMISSED WITH PREJUDICE. Plaintiff’s claims under the ADEA are DISMISSED WITH PREJUDICE. Plaintiff’s claims under the ADA based on his own disability and based on association with his disabled wife are DISMISSED WITH PREJUDICE. Plaintiff’s FMLA retaliation claim based on use of leave for his own medical condition is DISMISSED WITH PREJUDICE.

The Court DENIES summary judgment as to Plaintiff’s claim for “regarded as” disability discrimination and FMLA retaliation for use of leave to care for his wife as to the unpaid leave adverse employment action, but GRANTS summary judgment on these claims as to the alleged discharge adverse employment action. Thus, the only remaining claims are Plaintiff’s ADA “regarded as” claim and his FMLA retaliation claim related to being placed on unpaid leave (October 3 through November 29, 2016).

It is so ORDERED.

Footnotes

1

The Court cites to Plaintiff’s exhibits as docket no. 43-1 at [the ECF page number]. The Court notes that Plaintiff’s Response includes 40 exhibits that span 241 pages, which are filed electronically as one document rather than as separate exhibits, and without an index, making it difficult for the Court to utilize the appendix of exhibits efficiently. In addition, most of Plaintiff’s deposition exhibits lack deposition page numbers, making it difficult to locate cited deposition testimony and to tell whether pages are sequential or whether there are omitted pages in between. Plaintiff is advised not to file appendices with these deficiencies in the future.

2

Mesa’s testimony about when this conversation occurred is confusing. He ultimately stated that Drennan asked him if he was going to retire “right there pretty close at the end,” meaning near the end of his employment in late 2016. Mesa depo. at 95.

3

Castaneda testified that, at an unspecified time, he received a notice via email that Mesa had missed the MedClinic appointment. Castaneda depo. at 13. The Texas MedClinic notice is titled “Missed/Rescheduled Appointment” and it may have been this notice. Castaneda stated that he followed up with human resources to see if they had talked to Mesa but could not recall with whom he spoke, and that he did not follow up further on why Mesa “missed” the appointment because that would fall under HR. Id. He did state that he had a conversation, he thought with human resources, that Mesa had to go out of town, but he could not recall the circumstances. Id. at 14.

4

Mesa could not say for sure whether he had one or two telephone conversations with Harris-Rowland. Mesa depo. at 122. When asked about conversations on the 15th, he recalled that a conversation was later in the day, while Harris-Rowland’s testimony indicates there was a conversation that morning.

5

This email is included within the body of another email and is cropped so that it appears to be from Harris-Rowland, and Harris-Rowland testified at her deposition, “That’s what he told me and that’s what I reported.” Docket no. 43-1 at 144. Mesa denied ever telling anyone that he would not be reporting to work because he did not feel well. Mesa depo. at 124.

6

At 9:21, Drennan sent an email (recipients unclear) asking “Has Abel Mesa contacted you to provide an update on returning to work or not returning to work?” Docket no. 41-14. Ronaldo Gutierrez responded (Vernon King and Fred Roseland are copied), “He has not contacted me.” Id. Vernon King sent an email at 6:50 p.m. stating that at 4:32, Mesa “let me know he was on way back from Houston with his wife today. He said that they had another appointment in Houston Monday morning 9/19/16.” Id.

7

Plaintiff has provided an undated email from Fred Bonewell, Chief Safety and Security Officer, stating, “The gentleman from Leon Creek accident last week is still pending on a couple of factors: 1.) He missed an appointment last week to leave out of town. This has been reported to the carrier. 2.) The physician has ordered an MRI to fully understand what is going on inside the shoulder joint. This may take a while to rectify since he’s out of town. Will keep you in the loop.” Docket no. 143-1 at 171. It appears undisputed that no physician ordered an MRI, and that Bonewell was mistaken. Castaneda testified that, during the meeting after Mesa’s return, there were questions as to whether Mesa could get an MRI to make sure he had no issues with the injury, but because the workers’ compensation case was closed, there was no justification in accordance with the workers’ compensation regulations to seek additional diagnostic treatments. Castaneda could not recall who suggested an MRI, but he testified that “there were questions as to whether he could get an MRI” and when asked who wanted him to get an MRI, he answered “I believe it was a consensus to make sure he had no issues with the current injury he had sustained.” Castaneda depo. at 23-24.

8

Mesa’s Response states that Urrutia called and spoke with Harris-Rowland to discuss Mesa before telling Drennan that Mesa was not cleared to return and then states, “However, in her testimony, Harris-Rowland denied ever telling Urrutia that he needed to take Mesa off the job, or that there were any issues with Mesa’s medical paperwork.” But this testimony is not inconsistent, as Urrutia testified that he did not recall exactly the sequence of what he did and that he “would say yes” he spoke with Harris-Rowland but he did not know exactly what she told him to do and he did not “recall anybody telling [him] that [Mesa] received a full-duty release form.” Urrutia depo. at 33.

9

CPS Energy’s Motion asserts that Drennan was not involved in the decision and cites Drennan’s deposition testimony (Ex. 18) at page 16 that Drennan was “only advised of the decision afterwards”. Docket no. 41 at 23. However, Exhibit 18 contains only pages 4 through 13 of Drennan’s deposition, and thus this testimony is not in the record. Nevertheless, Plaintiff has not rebutted this assertion or offered any evidence that Drennan was involved in the decision. Mesa’s brief asserts that Harris-Rowland, Urrutia, Bonewell, Castaneda, and “others” participated in the conference call, citing a meeting roster that does not include Drennan. Docket no. 43 at 8 (citing Plaintiff’s Ex. 26). Thus, Plaintiff has not disputed that Drennan was not involved in the decision.

10

Plaintiff’s brief asserts that “Urrutia later admitted that if Mesa had not been about to retire then the corrective action policy should have applied.” Docket no. 43 at 11. However, Urrutia’s testimony is as follows:

Q. Okay. If Mesa hadn’t been about to retire and missed the appointment, would the Corrective Action Policy have been applied to him? MS. REINHARD: Objection only to the extent it calls for speculation.

A. I - I think - I - I can’t - Again, that would be speculating on my part. I - we’d have to - it’d be speculating on my part. Our Corrective Action Policy does, you know, mention that - if I remember right, I mean, there is -- ... - there is mention of this type of occurrence in our policy.”

Docket no. 43-1 at 126-27.

11

Mesa contends in his Response that Harris-Rowland testified that Urrutia had requested the MRI and that is why she wrote that on the Critical Issues Report (Harris-Rowland depo. at 22). However, Harris-Rowland’s testimony is as follows:

Q.... What did you mean by “pending MRI”?

A. I was writing what I had been informed of by Rick.

Q. Okay. So Mr. Urrutia would have told you that the leave was pending MRI?

...

A. Yes

Docket no. 43-1 at 136.

12

Reed Group sent a letter directed to Harris-Rowland dated September 30 stating that Mesa had been approved for FMLA leave on September 16 and September 19, and that he had a pending FMLA request for October 10. Docket no. 43-1 at 166-67 (Ex. 27).

13

See also Silk v. Bd. of Trustees Moraine Valley Comm. College, 795 F.3d 698, 706 (7th Cir. 2015) (the defendant bears the burden of establishing that the impairment was both transitory and minor); Budhun v. Reading Hosp. & Med. Ctr., 765 F.3d 245, 259 (3d Cir. 2014) (“The ADA regulations list being ‘transitory and minor’ as a defense to an ADA claim.”). But see Adair v. City of Muskogee, 823 F.3d 1297, 1306 (10th Cir. 2016) (“Under the ADAAA, for a plaintiff alleging disability discrimination to show that the employer regarded him as having an impairment, the plaintiff must show that (1) he has an actual or perceived impairment, (2) that impairment is neither transitory nor minor, and (3) the employer was aware of and therefore perceived the impairment at the time of the alleged discriminatory action.”

14

Mesa depo. at 156-57.

15

The Court notes that Mesa cites to pre-ADAAA amendment case law in his reply brief (docket no. 42 at 14), thus incorrectly asserting that a plaintiff must show that the employer regarded him as having a substantially limiting impairment.

16

CPS also argues that this Court should follow “the Fifth Circuit’s pre-amendment precedent and other federal courts’ post-amendment holdings concerning fitness-for-duty requirements and, based on the record before it, grant summary judgment to CPS Energy on Mesa’s ‘regarded as’ claim.” Docket no. 44 at 5. For the pre-amendment Fifth Circuit precedent, it cites Richardson v. U.S. Postal Service, 215 F. App’x 326 (5th Cir. 2007), in which the Fifth Circuit noted that the employee’s “best evidence that the USPS regarded him as having an impairment that substantially limits a major life activity is the fact that the USPS did not allow him to work,” but rejected the regarded-as claim because “an employer’s belief that an employee is unable to perform one task with an adequate safety margin does not establish per se that the employer regards the employee as having a substantial limitation on his ability to work in general.” Id. But this analysis still focuses on the pre-ADAAA requirement that the employer regard the employee as having a substantial limitation, which is the exact requirement removed by the ADAAA in 2008. The same is true for Leach v. Mansfield, No. H-07-4331, 2010 WL 707382 (S. D. Tex. Feb. 24, 2010), in which the court noted that the plaintiff’s perceived or actual inability to perform his specific job did not establish a perceived disability because the plaintiff “must be perceived as being substantially limited in performing a broad range of jobs,” and requesting an employee who has made threats to undergo a fitness for duty exam “does not in itself show that the employer perceives the employee to have a substantially limiting impairment.” The “substantially limiting impairment” requirement cannot be divorced from this analysis to make it apply to post-ADAAA cases.

For its “post-amendment” holdings from other courts, CPS Energy cites to Pena v. City of Flushing, 651 F. App’x 415 (6th Cir. 2016), but as CPS Energy itself acknowledges, this case holds only that an employer’s knowledge of an impairment and requiring a fitness-for-duty examination requirement is not a per se “regarded as” violation. The court reasoned that, because the ADA permits employers to request fitness-for-duty examinations as long as they are job-related and consistent with business necessity, requesting such an examination does not impose per se liability when the employee refuses to take the exam, as the employee in Pena did. The Pena court further noted that, by refusing to submit to an exam, the employee is precluded from being able to establish a genuine issue of material fact as to whether the exams were related to his job, or too broad in scope. Id. Here, Mesa argues that he did not refuse to submit to the exam, that he was willing to submit to the exam, that he was told he could take the exam on Friday, and that he showed up for the exam. In addition, as will be discussed, it appears undisputed that CPS Energy did regard Mesa as impaired at least initially, since it prepared a light duty accommodation for him based on the MedClinic restrictions, and the real question is whether CPS continued to view him as having an impairment when it placed him on unpaid leave (and whether that impairment was transitory and minor within the meaning of the ADA). Accordingly, because there is evidence that CPS viewed Mesa as impaired and because it is disputed whether Mesa was insubordinate in failing to appear for the fitness-for-duty exam, Pena is not on point. Similarly, in Johnson v. Univ. Hospitals Physician Services, 617 F. App’x 487, 491 (6th Cir. 2015), the employee’s “sole evidence that defendant perceived her as disabled is that it referred her to a fitness-for-duty exam.” In Koszuta v. Office Depot, Inc., No. 16-C-2679, 2018 WL 1769368 (N.D. Ill. Apr. 12, 2018), the employee also refused to undergo a fitness-for-duty exam. This Court further notes that, despite being recently decided, Johnson and Koszuta both mistakenly cite the pre-ADAAA definition of “regarded as.” Thus, these cases do not help CPS Energy.

17

It does not appear that Mesa is asserting a mixed-motive basis for his ADA discrimination claim, in which he would agree that the Defendant’s asserted reason, while true, is only one of the reasons for its conduct, and another motivating factor is the plaintiff’s protected characteristic. See Clark v. Boyd Tunica, Inc., 665 F. App’x 367, 371 n.4 (5th Cir. 2016). His briefing on the ADA claim focuses solely on casting doubt on whether CPS Energy’s asserted reason is untrue. However, he appears to invoke mixed-motives for his FMLA retaliation claim. The Court notes that Defendant has lumped all claims together for purposes of its pretext argument, though it relies upon an ADA case recognizing a mixed-motive alternative for ADA discrimination claims in its briefing. Docket no. 41 at 20 (citing Delaval v. PTech Drilling Tubulars, LLC, 824 F.3d 476, 480 (5th Cir. 2016) (citing EEOC v. LHC Group, Inc., 773 F.3d 688 (5th Cir. 2014), which the Fifth Circuit recognized Clark as applying a mixed-motives analysis) ). While the Fifth Circuit has recognized a mixed-motives alternative in ADA discrimination cases, it has not decided whether the mixed-motives alternative survived the Supreme Court’s decision in Gross v. FBL Financial Services, Inc., 557 U.S. 167 (2009). Id. Similarly, it has not decided whether the mixed-motive framework survived Gross and University of Texas Southwestern Medical Center v. Nassar, 570 U.S. 338 (2013) in FMLA retaliation claims. Ion v. Chevron USA, Inc., 731 F.3d 379, 389-90 (5th Cir. 2013); see also Wheat v. Florida Parish Juvenile Justice Comm’n, 811 F.3d 702 (5th Cir. 2016).

18

The text is statement 1/6, which is from the “Claimant” on October 4. The next page D-598 is statement 2/6, from Harris-Rowland, but it contains no text or statement, and the index states that the “Issue Type” for the statement is “FIRED.” Statement 3/6 from Harris-Rowland contains the following text: “What was the reason for separation from work? FAILED TO COMPLY WITH OUR REQUEST.”

19

As noted, Mesa appears to invoke a mixed-motive analysis for his FMLA retaliation claim in which retaliatory animus was a motivating factor in an adverse employment action. The Fifth Circuit has not decided whether the mixed-motive analysis may still be applied. Ion v. Chevron USA, Inc., 731 F.3d 379, 389-90 (5th Cir. 2013); see also Wheat v. Florida Parish Juvenile Justice Comm’n, 811 F.3d 702 (5th Cir. 2016). Neither party addresses this issue, but both cite Mauder v. Metro. Transit Auth. of Harris Cty., Tex., 446 F.3d 574, 583 (5th Cir. 2006). Defendant lumps all of the claims together in its pretext argument, without distinguishing among the various claims, but cites Delaval v. P Tech Drilling Tubulars, LLC, 824 F.3d 476 (5th Cir. 2016) for the causation standard, which is an ADA case applying a motivating factor test (i.e., mixed motives).

20

Nor has he rebutted CPS Energy’s argument that he was not replaced by someone younger because the person who filled his position was already a Control Room Operator at a different power plant. CPS Energy asserts that it has not hired anyone to fill Mesa’s position since his unpaid leave and retirement. The employee that Mesa testified that Drennan wanted to replace him with was already a control room operator at another power plant. This employee is younger than Mesa but is over age 40, and was moved to the Leon Green power plant in January 2017. CPS argues that his relocation does not qualify as a “replacement” that satisfies the fourth element of Mesa’s prima facie case, citing Mack v. John L. Wortham & Son, L.P., 541 F. App’x 348, 359 (5th Cir. 2013) for the proposition that the plaintiff was not replaced by another employee already employed with the employer and Sellers v. BNSF Ry. Co., No. 1:11-CV-190, 2013 WL 1181458, at *11 (E.D. Tex. Mar. 18, 2013) for the proposition that reassignment or absorption of a terminated employee’s job duties does not constitute “replacement” for purposes of the prima facie case. Mesa does not respond to this argument, and the Court assumes that Mesa is not proceeding on a theory that he was replaced by someone younger.

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