Perez v. Regn 20 Educ Svc Ctr ( 2002 )


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  •                        REVISED OCTOBER 8, 2002
    IN THE UNITED STATES COURT OF APPEALS
    FOR THE FIFTH CIRCUIT
    No. 01-50591
    DANIEL M PEREZ
    Plaintiff - Appellant
    v.
    REGION 20 EDUCATION SERVICE CENTER
    Defendant - Appellee
    Appeal from the United States District Court
    for the Western District of Texas, San Antonio
    September 20, 2002
    Before KING, Chief Judge, and SMITH and PARKER, Circuit Judges.
    KING, Chief Judge:
    Plaintiff-Appellant Daniel M. Perez ("Perez") filed suit
    against Defendant-Appellee Region 20 Education Service Center
    ("Region 20") for alleged violations of Title VII of the Civil
    Rights Act of 1964 ("Title VII"), 42 U.S.C. § 2000e-2 (2000), the
    Americans with Disabilities Act ("ADA"), 42 U.S.C. § 12112
    (2000), and the Texas Whistleblower Act, TEX. GOV’T CODE ANN.
    § 554.002 (Vernon 1994 & Supp. 2002).       The district court granted
    summary judgment in favor of Region 20 and Perez appeals.       We
    AFFIRM.
    I.    FACTUAL AND PROCEDURAL HISTORY
    On October 22, 1990, Perez began working for Region 20 as a
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    Data Processing Specialist.   Region 20 is one of several
    Education Service Centers ("Centers") charged with administering
    statewide educational programs and supporting local school
    districts.   In 1991, Perez was promoted to the position of Senior
    Analyst Specialist II in the Regional Service Center Computer
    Cooperative ("RSCCC") systems group.
    Perez wished to become a Database Administrator for the
    RSCCC group.   Unlike other computer groups at Region 20, the
    RSCCC group did not have a Database Administrator position.
    Perez began taking on some database administration duties.    These
    duties were not part of Perez's job description, but employees at
    Region 20 often took on duties outside of their job descriptions.
    Perez submitted a request to Region 20 asking to be promoted to,
    or reclassified as, a Database Administrator because it was a
    higher-level position than Senior Analyst Specialist II.    Perez's
    request was not granted because there was no Database
    Administrator position available in the RSCCC group, but Perez
    was told that if the position was ever approved and funded for
    his group, he would get the position.
    In June 1998, Perez filed a complaint with the Equal
    Employment Opportunity Commission ("EEOC"), claiming that Region
    20 discriminated against him on the basis of national origin in
    failing to promote or reclassify him.
    In late 1997, Perez began experiencing stress and
    depression; by January 1998, though, Perez received a clean bill
    of health.   In June 1998, Perez was treated for stomach problems
    and work-related stress.   Perez then told Region 20 that he was
    No. 01-50591
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    having medical problems and submitted certification of anxiety,
    depressive disorder, dysthemia, and stress.    Perez's therapist
    noted that his condition was not chronic or incapacitating but
    nonetheless recommended that Perez's work schedule be limited to
    37.5 hours per week.   Region 20 limited Perez's work schedule
    until April 1999, when Perez's doctor released him to work
    overtime under certain conditions.
    Though Perez had previously received positive performance
    reviews, Perez's annual performance review in August 1998
    contained several negative comments.     In March 1999, Perez
    received a memo from a supervisor stating that his performance
    was substandard and warning of possible consequences.    In June
    1999, Perez received two further memos documenting problems with
    his work performance and hours.   Perez was discharged on July 1,
    1999.
    Perez responded to his discharge by filing several
    complaints against Region 20.   Region 20 does not have a formal
    procedure for an employee to appeal his termination, but it
    allowed Perez to file a grievance.   The grievance committee ruled
    against Perez.   Perez also filed a grievance with the
    Commissioner of Education; that grievance was ultimately
    dismissed due to lack of jurisdiction.    In July 1999, Perez filed
    a second EEOC complaint, alleging that: (1) Region 20 discharged
    him due to his Hispanic national origin; (2) Region 20
    discriminated against him because of his mental illness
    disability in violation of the ADA; and (3) Region 20 discharged
    him in retaliation for filing a previous EEOC complaint.    The
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    EEOC denied Perez's charges of discrimination and retaliation and
    informed Perez of his right to sue Region 20.
    Perez filed suit in Texas state court, alleging that Region
    20 violated Title VII, the ADA, and Texas state law.
    Specifically, Perez al
    leged: (1) Region 20 discriminated against him on account of his
    Hispanic national origin, in violation of Title VII, when it
    failed to grant his request to reclassify his position or promote
    him; (2) Region 20 discharged him in retaliation for filing his
    charge of discrimination with the EEOC in violation of Title VII;
    (3) Region 20 discharged him because of his Hispanic national
    origin in violation of Title VII; (4) Region 20 discriminated
    against him due to his mental illness disability in violation of
    the ADA; and (5) Region 20 discharged him in retaliation for
    reporting the sexual harassment of another Region 20 employee in
    violation of the Texas Whistleblower Act.     Region 20 removed the
    lawsuit to federal district court.
    The district court granted summary judgment for Region 20 on
    all claims.   Perez appealed.
    II.    STANDARD OF REVIEW
    This court reviews a grant of summary judgment de novo,
    applying the same standards as the district court.      Daniels v.
    City of Arlington, 
    246 F.3d 500
    , 502 (5th Cir.), cert. denied,
    
    122 S. Ct. 347
    (2001).      Summary judgment should be granted if
    there is no genuine issue of material fact for trial and the
    moving party is entitled to judgment as a matter of law.      FED. R.
    CIV. P. 56(c).   In determining if there is a genuine issue of
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    material fact, the court reviews the evidence in the light most
    favorable to the non-moving party.     
    Daniels, 246 F.3d at 502
    .
    A genuine issue of material fact exists when there is
    evidence sufficient for a rational trier of fact to find for the
    non-moving party.     Matsushita Elec. Indus. Co. v. Zenith Radio
    Corp., 
    475 U.S. 574
    , 586-87 (1986).     When the non-moving party
    bears the burden of proof on a claim, the moving party may obtain
    summary judgment without providing evidence that negates the non-
    moving party's claim.     See Celotex Corp. v. Catrett, 
    477 U.S. 317
    , 322-25 (1986).    Rather, the moving party need only highlight
    the absence of evidence in support of the non-moving party's
    claim.   See 
    id. III. DISCUSSION
    Perez raises five issues on appeal.       He argues that: (1)
    Region 20 failed to promote or reclassify him on the basis of his
    Hispanic national origin in violation of Title VII; (2) Region 20
    discharged him in retaliation for making an EEOC complaint in
    violation of Title VII; (3) Region 20 discharged him on account
    of his Hispanic national origin in violation of Title VII; (4)
    Region 20 discriminated against him due to his mental illness
    disability in violation of the ADA; and (5) Region 20 discharged
    him in retaliation for reporting sexual harassment in violation
    of the Texas Whistleblower Act.     We consider each claim in turn.
    A.       Title VII Failure to Promote Claim
    Perez first contends that Region 20's failure to promote him
    to the position of Database Administrator violates Title VII's
    prohibition of discrimination in employment on the basis of
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    national origin.     See 42 U.S.C. § 2000e-2(a) (2000).    To make out
    a prima facie case of discrimination based on failure to promote,
    Perez must show that: (1) he belongs to a protected class; (2) he
    was qualified for the job he sought; (3) despite his
    qualifications, Perez was rejected; and (4) after his rejection,
    the position remained open and Region 20 continued to seek
    applicants from persons of Perez's qualifications.        McDonnell
    Douglas Corp. v. Green, 
    411 U.S. 792
    , 802 (1973); Bennett v.
    Total Minatome Corp., 
    138 F.3d 1053
    , 1060 (5th Cir. 1998).         If
    Perez establishes a prima facie case, the burden shifts to Region
    20 to articulate a legitimate, non-discriminatory reason for
    Perez's rejection.     See Reeves v. Sanderson Plumbing Prods.,
    Inc., 
    530 U.S. 133
    , 142 (2000); McDonnell Douglas 
    Corp., 411 U.S. at 802
    .   If Region 20 articulates a non-discriminatory reason,
    Perez must then show that Region 20 did intentionally
    discriminate, which he may do by demonstrating that Region 20's
    proffered reason is simply a pretext for discrimination.        See
    
    Reeves, 530 U.S. at 143
    , 146-48.
    The district court found that Perez had made out his prima
    facie case, but that Region 20 had articulated a legitimate, non-
    discriminatory reason for its failure to promote Perez.       We
    bypass the serious question whether Perez even met his prima
    facie burden and address Region 20's articulated reasons for its
    failure to promote or reclassify Perez.
    Region 20 argues, and presented summary judgment evidence to
    the effect that, it did not promote Perez or reclassify his
    position because the position of Database Administrator within
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    the RSCCC group was never approved for funding and, therefore,
    the position did not exist.    The district court found this to be
    a legitimate, non-discriminatory reason for the failure to
    promote Perez and found that Perez had failed to present
    sufficient evidence to suggest that Region 20's stated reason was
    false.    Perez notes only that another software group at Region 20
    did contain a Database Administrator position and that other
    employees (two Anglo males, one Hispanic woman, one African-
    American male, and one Asian-American woman) were reclassified.
    Neither fact, nor the argument that underlies them, addresses the
    inescapable fact that, as Perez admits in his brief, “[a]t the
    time [he] began requesting the promotion/reclassification, his
    funded software area (RSCCC group) did not have the position of
    Database Administrator.”    The nonexistence of an available
    position is a legitimate reason not to promote.    See Int’l Bhd.
    of Teamsters v. United States, 
    431 U.S. 324
    , 358 n.44 (1977)
    (finding that the “absence of a vacancy in the job sought” is a
    legitimate reason for not hiring a person for a position).     As
    Perez produced no evidence to disprove this legitimate non-
    discriminatory justification for Region 20's failure to promote
    or reclassify him, the district court correctly granted summary
    judgment on Perez’s Title VII failure to promote claim.
    B.   Title VII Discharge Claims
    Perez next makes two Title VII claims related to his
    discharge.    First, he argues that he was discharged in
    retaliation for filing his complaint of discrimination with the
    EEOC.    Second, he contends that he was discharged on account of
    No. 01-50591
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    his Hispanic national origin.
    Title VII prohibits retaliation against employees who engage
    in protected conduct, such as filing a complaint of
    discrimination.   See 42 U.S.C. § 2000e-3(a) (2000).    To make out
    a prima facie case of retaliation, Perez must show: (1) he
    engaged in a protected activity; (2) he suffered an adverse
    employment action; and (3) a causal nexus exists between the
    protected activity and the adverse employment action.        Gee v.
    Principi, 
    289 F.3d 342
    , 345 (5th Cir. 2002).   Once this prima
    facie burden is met, retaliation claims utilize the same burden-
    shifting approach as do failure to promote claims.     
    Id. Both parties
    agree that Perez satisfied the first two
    elements of a prima facie case by providing evidence that Perez
    filed a complaint with the EEOC (a protected activity) and that
    he was terminated on July 1, 1999 (an adverse employment action).
    Region 20 disputes that Perez provided sufficient evidence of the
    third element, causation.   The district court found that Perez
    provided sufficient evidence of a causal connection.    It
    recognized that timing can constitute evidence of a causal
    connection between a protected activity and termination and
    looked to see whether Region 20 had articulated a legitimate,
    non-discriminatory reason for the termination.   The court then
    found that the reason proffered by Region 20, poor work
    performance, was adequate to shift the burden back to Perez to
    disprove the proffered reason.
    We again assume that Perez made out his prima facie case.
    Perez's claim nonetheless fails because he has not provided
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    evidence to refute Region 20's proffered explanation for his
    discharge.   Perez points to the failure by Region 20 to meet with
    him to set performance goals as evidence of pretext.     Such a
    failure may be a management lapse, but it does not amount to
    evidence of retaliation.    See Mayberry v. Vought Aircraft Co., 
    55 F.3d 1086
    , 1091 (5th Cir. 1995) ("The question is not whether an
    employer made an erroneous decision; it is whether the decision
    was made with discriminatory motive.").     Perez also suggests that
    the fact that he received a low performance review within months
    of his complaint shows pretext.    The negative August 1998
    performance review, however, is substantiated by other evidence
    in the summary judgment record; Perez provides no evidence that
    challenges the accuracy of his performance review.     Merely
    disagreeing with an employer's negative performance assessment is
    insufficient to show pretext.     See Shackelford v. Deloitte &
    Touche, LLP, 
    190 F.3d 398
    , 408 (5th Cir. 1999).      Perez has thus
    failed to produce sufficient evidence of pretext.     The district
    court properly granted summary judgment on Perez’s retaliation
    claim.
    Perez also claims that Region 20 discharged him due to his
    Hispanic national origin.   Again, even assuming that Perez could
    make out a prima facie case of discrimination, he simply provided
    insufficient evidence that his termination was due to anything
    other than his poor work performance.      Poor work performance is a
    legitimate, non-discriminatory reason for discharge.      See, e.g.,
    
    Shackelford, 190 F.3d at 408
    .     The district court properly
    granted summary judgment for Region 20 on this claim.
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    C.   Americans with Disabilities Act Claim
    Perez next contends that he was discriminated against in
    violation of the ADA.   Before addressing the merits of this
    claim, we must address the jurisdictional issue of whether
    Perez's ADA claim is barred by sovereign immunity.1   We review
    Eleventh Amendment immunity determinations de novo.   See Cozzo v.
    Tangipahoa Parish Council, 
    279 F.3d 273
    , 280 (5th Cir. 2002).
    The Eleventh Amendment bars an individual from suing a state
    in federal court unless the state consents to suit or Congress
    has clearly and validly abrogated the state's sovereign immunity.
    See U.S. CONST. amend. XI; see also, e.g., Coll. Sav. Bank v. Fla.
    Prepaid Postsecondary Educ. Expense Bd., 
    527 U.S. 666
    , 670 (1999)
    (finding an individual may sue a state if the state consents to
    suit or Congress validly abrogates sovereign immunity).    The
    state need not be the named party in a federal lawsuit, for a
    state's Eleventh Amendment immunity extends to any state agency
    or entity deemed an "alter ego" or "arm" of the state.     See Vogt
    v. Bd. of Comm'rs, 
    294 F.3d 684
    , 688-89 (5th Cir. 2002).
    Region 20 and the amicus curie State of Texas argue that
    Region 20 is an arm of the state that has not consented to suit
    1
    Sovereign immunity does not bar Perez's Title VII
    claims, as we have long recognized that Congress has clearly
    abrogated the states' Eleventh Amendment immunity in enacting
    Title VII. See, e.g., Ussery v. Louisiana ex rel. La. Dep't of
    Health & Hosps., 
    150 F.3d 431
    , 434-35 (5th Cir. 1998).
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    and Perez's claim under Title I of the ADA is thus barred.2     As
    the Supreme Court recently held in Board of Trustees v. Garrett,
    Congress did not abrogate the states' sovereign immunity in
    enacting Title I of the ADA.   See 
    531 U.S. 356
    , 365-74 (2001).
    Thus, the Eleventh Amendment bars Perez's ADA claim if Region 20
    is considered an arm of the state.
    The inquiry then becomes "whether the lawsuit is one which,
    despite the presence of a state agency as the nominal defendant,
    is effectively against the sovereign state."    Earles v. State Bd.
    of Certified Pub. Accountants, 
    139 F.3d 1033
    , 1037 (5th Cir.
    1998).   This circuit uses a six-factor test to guide this
    inquiry.   
    Cozzo, 279 F.3d at 281-83
    ; Clark v. Tarrant County, 
    798 F.2d 736
    , 744-45 (5th Cir. 1986).    The six factors are: (1)
    whether state statutes and case law view the entity as an arm of
    the state; (2) the source of the entity's funding; (3) the
    entity's degree of local autonomy; (4) whether the entity is
    concerned primarily with local, as opposed to statewide,
    problems; (5) whether the entity has the authority to sue and be
    sued in its own name; and (6) whether the entity has the right to
    hold and use property.   See 
    Clark, 798 F.2d at 744-45
    .    No one
    factor is dispositive, though we have deemed the source of an
    entity's funding a particularly important factor because a
    principal goal of the Eleventh Amendment is to protect state
    2
    Perez argues in his brief that he was not afforded any
    opportunity to provide evidence that Region 20 is not an arm of
    the state because "the claim was raised for the first time in
    [Region 20's] reply." Region 20 asserted its sovereign immunity
    defense in its First Amended Answer, directly in response to the
    ADA claim in Perez's First Amended Original Petition. Perez has
    had sufficient notice of this defense.
    No. 01-50591
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    treasuries.    See Hudson v. City of New Orleans, 
    174 F.3d 677
    , 682
    (5th Cir. 1999).    An entity need not show that all of the factors
    are satisfied; the factors simply provide guidelines for courts
    to balance the equities and determine if the suit is really one
    against the state itself.    See 
    id. The district
    court concluded that Region 20 is an arm of the
    state entitled to Eleventh Amendment immunity.    The district
    court noted that the Texas Attorney General considers the Centers
    state agencies, that the Centers receive significant funding from
    the state, that the Commissioner of Education determines the
    number of Centers and their boundaries, and that the Commissioner
    directs the Centers in implementing legislative initiatives
    assigned to the Commissioner of Education.
    Region 20 and the amicus curie State of Texas provide
    sufficient evidence that Region 20 is, in effect, an arm of the
    state.   The Education Service Centers are at the intermediate
    level of Texas's three-tiered educational system, between the
    state education agency and the local school districts.       San
    Antonio Indep. Sch. Dist. v. McKinney, 
    936 S.W.2d 279
    , 282 (Tex.
    1996) ("At the state level, we have the Texas Education Agency,
    headed by the Commissioner of Education and the State Board of
    Education.    Regionally, the Legislature created Regional
    Education Service Centers.    At the local level are independent
    school districts.") (citations omitted).    The mission of the
    Centers is to "ensure that all Texas children have access to a
    quality education" because "a general diffusion of knowledge is
    essential for the welfare of this state and for the preservation
    No. 01-50591
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    of the liberties and rights of citizens."    TEX. EDUC. CODE ANN.
    § 4.001(a) (Vernon 1996 & Supp. 2002).    The Centers provide
    several core services, such as teacher training and assistance to
    underperforming school districts, to improve educational
    efficiency and performance.   See 
    id. § 8.051.
      The Centers also
    administer statewide programs, such as technology initiatives,
    see 
    id. § 32.001(a)(4),
    and programs for students with
    disabilities, see 
    id. § 29.001(4).
    (1) State Statutes and Case Law
    First, we consider whether state statutes and case law view
    the Centers as arms of the state.    The Texas Education Code
    ("Code") reveals that the Centers are more closely aligned with
    state, rather than with local, government.    Chapter 7 of the Code
    establishes and defines the roles of the Texas Education Agency
    ("TEA"), see TEX. EDUC. CODE ANN. § 7.021 (Vernon 1996 & Supp.
    2002), Commissioner of Education ("Commissioner"), see 
    id. § 7.055,
    and State Board of Education, see 
    id. § 7.102.3
        Chapter
    8 then explains that the Commissioner is responsible for
    establishing Centers for statewide access to educational
    resources and programs.   See 
    id. § 8.001.
      The Commissioner
    supervises the Centers and has broad authority to "decide any
    matter concerning the operation or administration of the regional
    education service centers."   
    Id. § 8.001(c).
       A key purpose of
    the Centers is to "implement initiatives assigned by the
    legislature or the commissioner [of education]."     
    Id. § 8.002(3).
    3
    The Commissioner is appointed by the governor, see TEX.
    EDUC. CODE ANN. § 7.051 (Vernon 1996 & Supp. 2002), and is the
    executive officer of the TEA, see 
    id. § 7.055(a)(2).
                               No. 01-50591
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    The Code distinguishes the Centers from local school districts,
    which are governed by Chapter 11 of the Code and are not under
    the guidance of the Commissioner and the TEA.   See, e.g., 
    id. § 11.151(b)
    (explaining that school district trustees have the
    "exclusive power and duty" to govern public schools).   The
    Centers, then, are administrative subdivisions within the TEA
    according to state statutes.
    Texas case law also suggests that the Centers are arms of
    the state.   In Davis v. Education Service Center, the Texarkana
    Court of Appeals considered whether a Center should be considered
    an arm of the state for purposes of state sovereign immunity.
    See 
    62 S.W.3d 890
    , 895-96 (Tex. App.--Texarkana 2001, no pet.).
    After a brief discussion, the court concluded: "When Davis sued
    Region VIII and Ferguson, in his official capacity, she sued the
    State of Texas."   
    Id. at 895.
      While the analysis in Davis is not
    controlling on the issue of Eleventh Amendment immunity, it
    reflects the state's view that suing a Center is equivalent to
    suing the state of Texas itself.
    State statutes and case law, then, indicate that the State
    of Texas views the Education Service Centers as arms of the
    state.4   Perez has not provided adequate summary judgment
    4
    While opinions of the state Attorney General are also
    relevant evidence of how a state views an entity, see, e.g.,
    
    Clark, 798 F.2d at 744
    , Texas Attorney General opinions add
    little to our Eleventh Amendment inquiry. The Texas Attorneys
    General have offered few opinions concerning the Centers, and
    their characterizations of the Centers have varied. In one
    opinion, the Attorney General referred to Centers as "state
    agenc[ies]," Op. Tex. Att'y Gen. No. MW-61, at 3 (1979), but in
    another, the Attorney General stated that Center employees are
    "hired by and accountable to the local board of directors," not
    the state board, Op. Tex. Att'y Gen. No. JM-203, at 12 (1984).
    No. 01-50591
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    evidence to rebut these authorities.5
    (2) Source of Funding
    Second, we address the extent to which the Centers receive
    funding from the State of Texas.   This inquiry considers both the
    state's liability for a judgment rendered against the Centers and
    the state's liability for general debts and obligations.    See
    
    Hudson, 174 F.3d at 687
    .   While the Code does not contain a
    specific provision requiring the state to indemnify the Centers
    in the case of a judgment, the significant financial support the
    state affords to the Centers suggests that a judgment against a
    Center would be borne in large part by the state.
    We examine the amount of funding the state provides to an
    entity and whether that funding is earmarked for any particular
    purposes to determine whether a judgment likely would be paid
    with state funds.   See 
    Hudson, 174 F.3d at 688-89
    .   The State of
    Texas provides several types of funding to the Centers.
    Initially, Centers receive state funding to provide core services
    to school districts and campuses to improve student and school
    Neither of the opinions contained any other discussion of the
    role of the Centers.
    5
    Perez suggests that Region 20 is not a state agency due
    to a statement made by the Commissioner of Education. After his
    discharge, Perez filed an administrative complaint with the
    Commissioner. In his complaint, Perez argued that the employment
    policies of the TEA applied to the Centers and that Region 20
    violated the TEA policy against discrimination. The Commissioner
    found that the TEA policies did not apply to the Centers because
    the Centers were not "agents of TEA." The statement of the
    Commissioner was made in response to a specific question
    regarding interpretation of the Texas Education Code. The
    Commissioner did not address whether Eleventh Amendment immunity
    applies to the Centers. We find this evidence unhelpful in
    determining whether the Centers are properly considered alter
    egos of the state.
    No. 01-50591
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    district performance and for basic operational expenses.      See
    TEX. EDUC. CODE ANN. §§ 8.051, 8.121 (Vernon 1996 & Supp. 2002).
    For 2000-2001, the state appropriated $58.8 million per year to
    the Centers for "core services, technical assistance, and program
    support."   Tex. H.B. 1, 76th Leg., R.S. (1999).    For 2002-2003,
    the state allocated $61 million per year to the Centers.     Tex.
    S.B. 1, 77th Leg., R.S. (2001).    Further, the Centers may receive
    additional funding from the state, including funds for efficiency
    initiatives, see TEX. EDUC. CODE ANN. § 8.122 (Vernon 1996 & Supp.
    2002), funding for specific state initiatives, see 
    id. § 8.123,
    competitive grants for innovation, see 
    id. § 8.124(a)(1),
    and
    emergency grants, see 
    id. § 8.124(a)(2).
        The state Commissioner
    of Education has broad authority to distribute state funds and
    allocate federal funds to the Centers.     See 
    id. §§ 8.001(c)(3),
    8.121(a), 8.122(c), 8.123(b)(2), 8.124(b)(2).      The Centers also
    receive local funding through payment by school districts for
    certain services and grant contracts with public and private
    entities.   See 
    id. §§ 8.053,
    8.125.   This local funding, however,
    fluctuates based on the Centers' ability to generate revenues;
    state funding is the only assured source of funding for the
    Centers.    Though the state is not the sole source of funding for
    the Centers, we are persuaded that state funding comprises the
    "lion's share" of the Centers' budgets.    See 
    Vogt, 294 F.3d at 693
    ; see also 
    Clark, 798 F.2d at 744
    (finding that a county
    probation department was an arm of the state even though it
    generated revenue through probation fees).
    Notably, unlike local school districts, the Centers do not
    No. 01-50591
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    possess any tax levying or bonding authority that could be used
    to raise funds.   See TEX. EDUC. CODE ANN. § 11.152 (Vernon 1996 &
    Supp. 2002).   This fact counsels in favor of granting Region 20
    immunity.   See Anderson v. Red River Waterway Comm'n, 
    231 F.3d 211
    , 214 (5th Cir. 2000) (finding no sovereign immunity because
    waterway commission could raise funds through its statutory
    taxing and bonding authority); Hander v. San Jacinto Junior
    Coll., 
    519 F.2d 273
    , 279 (5th Cir. 1975) (finding no immunity
    because state junior college could issue revenue bonds and levy
    annual ad valorem taxes).   In light of the Centers' dependence on
    the State of Texas for funding and their inability to raise their
    own revenues, it seems likely that a judgment rendered against
    the Centers would be paid in large portion by the state.     Indeed,
    the state provides the base funding for the Centers' operational
    expenses.   See TEX. EDUC. CODE ANN. § 8.121(c) (Vernon 1996 & Supp.
    2002) ("Each regional education service center shall use money
    distributed to it under this section for the provision of core
    services . . . or for payment of necessary administrative and
    operational expenses of the center related to the provision of
    those services.").6
    (3) Local Autonomy
    Third, we ask whether the Centers exercise local autonomy or
    6
    Perez notes that the Centers are like school districts
    because Centers are subject to or exempt from taxation in the
    same way school districts are, see TEX. EDUC. CODE ANN. § 8.005
    (Vernon 1996 & Supp. 2002), and because employees of Centers are
    immune from liability in the same way employees of school
    districts are, see 
    id. § 8.006.
    Neither of these factors,
    though, addresses whether a judgment against a Center would
    ultimately be paid by the state.
    No. 01-50591
    -18-
    whether they are primarily controlled by the state.      Frequent and
    broad oversight by the state suggests that the entity is an arm
    of the state.    See 
    Hudson, 174 F.3d at 689-90
    .   In the case of
    the Centers, members of the Board of Directors of each Center are
    selected locally.    See TEX. EDUC. CODE ANN. § 8.003(b) (Vernon 1996
    & Supp. 2002).   The Board of Directors governs each Center,
    develops management and operation policies, approves programs and
    activities, and establishes the budget.     See 
    id. § 8.003(e).
    Though the Directors are selected locally, their election is
    largely controlled by the state Commissioner of Education, as the
    Commissioner sets rules for selection, appointment, and
    continuity of board membership.    See 
    id. § 8.003(b).
       Once a
    Center's Board is elected, the Commissioner has the power to
    appoint a master or replace the Board of Directors if the Center
    is not performing well.    See 
    id. §§ 8.104(4),
    8.104(5).
    Management of the Centers can be distinguished from management of
    local school districts, as local school districts determine their
    own procedures for electing their Boards of Trustees and Trustees
    have exclusive power over the school districts.     See 
    id. §§ 11.011,
    11.051, 11.052.
    More generally, the Centers are subject to significant
    supervision by the state Commissioner of Education.      The
    Commissioner has broad authority to "decide any matter concerning
    the operation or administration" of the Centers.     See TEX. EDUC.
    CODE ANN. § 8.001(c) (Vernon 1996 & Supp. 2002).    The Commissioner
    sets operation and performance standards for each Center, see 
    id. § 8.101,
    and Centers are required by law to report their
    No. 01-50591
    -19-
    performance to the Commissioner annually, see 
    id. §§ 8.103,
    39.054(3)(B).   Underperforming Centers may be sanctioned or even
    closed by the Commissioner.     See 
    id. § 8.014.
       Further, the
    Commissioner must approve the appointment of each Center's
    Executive Director and can remove an Executive Director if a
    Center is underperforming.    See 
    id. §§ 8.004,
    8.104(5).
    The state oversight and control of the Centers contrasts
    markedly with the significant autonomy of local school districts.
    "Under Texas law, independent school districts enjoy a large
    amount of political autonomy from the State, the TEA, and the
    [State] Board [of Education]."     
    McKinney, 936 S.W.2d at 282
    .
    Each school district is governed by a Board of Trustees elected
    by the voters of the district.     See TEX. EDUC. CODE ANN. §§ 11.051-
    .053 (Vernon 1996 & Supp. 2002).     Trustees have "the exclusive
    power and duty to govern . . . public schools of the district."
    
    Id. § 11.151(b).
      "Importantly, neither the TEA nor the Board may
    substitute its judgment for the lawful exercise by district
    trustees of their powers and duties."       
    McKinney, 936 S.W.2d at 282
    -83.   The Centers' relative lack of autonomy counsels in favor
    of Eleventh Amendment protection.
    (4) Local or Statewide Issues
    Fourth, we consider whether the Centers focus primarily on
    local or statewide issues.    This factor asks "whether the entity
    acts for the benefit and welfare of the state as a whole or for
    the special advantage of local inhabitants."       Pendergrass v.
    Greater New Orleans Expressway Comm'n, 
    144 F.3d 342
    , 347 (5th
    Cir. 1998).   A primary mission of the Centers is to ensure
    No. 01-50591
    -20-
    statewide uniformity and quality in education.     See TEX. EDUC. CODE
    ANN. § 4.001(a) (Vernon 1996 & Supp. 2002).    The Texas
    Legislature gave the Commissioner power to establish up to twenty
    Centers and delineate their boundaries to serve schools around
    the state.    See 
    id. § 8.001.
      The Centers are accountable to the
    state Commissioner of Education, see, e.g., 
    id. §§ 8.101,
    8.103,
    not to local voters.    The Centers collect and deliver educational
    resources throughout the state, not just in one area; the Centers
    are simply divided into regions for convenience.     See 
    id. § 8.001(b).
      Though "[l]imited territorial boundaries suggest
    that an agency is not an arm of the state," an exception applies
    when a "regional entity is an administrative division of a
    statewide system."     
    Vogt, 294 F.3d at 695
    ; see also 
    Clark, 798 F.2d at 745
    ("Dividing the responsibilities [of the state
    probation system] into judicial districts is merely an
    administrative tool for handling a statewide, state program.").
    The Centers are just such an entity, as they serve as
    administrative divisions of the unitary state educational system.
    (5) Ability To Sue and Be Sued
    Fifth, we consider whether the Centers can sue or be sued in
    their own names.   The ability for an entity to sue and be sued
    apart from the state suggests that immunity is not appropriate.
    See Williams v. Dallas Area Rapid Transit, 
    242 F.3d 315
    , 322 (5th
    Cir.), cert. denied, 
    122 S. Ct. 618
    (2001).     The Code does not
    grant the Centers any statutory authority to sue, but it also
    does not prevent a Center from being sued in its own name.      In
    contrast, the Code expressly provides that school districts may
    No. 01-50591
    -21-
    sue and be sued.    See TEX. EDUC. CODE ANN. § 11.151(a) (Vernon 1996
    & Supp. 2002).   This factor, then, slightly favors immunity for
    the Centers.
    (6) Ability To Hold and Use Property
    Finally, we consider whether the Centers may hold and use
    property.   According to Texas law, the Centers may hold property,
    but this right is subject to approval by the Commissioner.      The
    Centers are authorized by statute to purchase, lease, and acquire
    property.   See TEX. EDUC. CODE ANN. § 8.055(a) (Vernon 1996 & Supp.
    2002).   Any transaction involving real property, however, must be
    approved by the Commissioner.    See 
    id. § 8.055(b).
        Further, the
    legislature has prohibited the Centers from purchasing land or
    acquiring buildings without prior authorization by the
    Commissioner.    See Tex. S.B. 1, 77th Leg., R.S. (2001) (Rider 4);
    Tex. H.B. 1, 76th Leg., R.S. (1999) (Rider 4).      In contrast,
    local school districts are expressly authorized to "acquire and
    hold real and personal property."     TEX. EDUC. CODE. ANN. §
    11.151(a) (Vernon 1996 & Supp. 2002).       This factor, then, weighs
    slightly in favor of immunity.
    Each of the six factors counsels in favor of immunity, some
    more strongly than others.    Combined, these factors make it clear
    that Region 20, as one of Texas's Education Service Centers, is
    properly considered an arm of the State of Texas and thus enjoys
    Eleventh Amendment immunity from suit in federal court.
    Perez contends that even if Region 20 is an arm of the
    state, it waived its sovereign immunity by removing this case to
    federal district court.    In support of this proposition, he cites
    No. 01-50591
    -22-
    Lapides v. Board of Regents, where the Supreme Court recently
    held that a state entity removing a case to federal district
    court waives its sovereign immunity with respect to state law
    claims.   See 
    122 S. Ct. 1640
    , 1643-46 (2002).    Subsequent to the
    point at which we asked for supplemental briefing to assess the
    impact of Lapides, our court decided Martinez v. Texas Department
    of Criminal Justice.    See No. 00-51135, 
    2002 WL 1721803
    (5th Cir.
    July 25, 2002).
    Martinez considered whether a plaintiff's argument of
    removal-by-waiver based on Lapides should be considered for the
    first time on appeal.    See 
    2002 WL 1721803
    , at *6-7.   Martinez
    alleged violations of the First Amendment and the Texas
    Whistleblower Act.    See 
    id. at *5.
      The district court denied
    Eleventh Amendment immunity to the defendants, and the defendants
    appealed.   See 
    id. Martinez argued
    for the first time on appeal
    that the defendants' removal to federal court waived their
    Eleventh Amendment immunity, citing Lapides.     See 
    id. at *6.
        We
    noted "our long established course of refusing, absent
    extraordinary circumstances, to entertain legal issues raised for
    the first time on appeal" and found that no extraordinary
    circumstances existed because the law "was not so settled prior
    to Lapides that raising [the] waiver-by-removal claim in district
    court would have been pointless or futile."      
    Id. at *7.
      We thus
    declined to consider the plaintiff's waiver-by-removal argument
    for the first time on appeal.    See 
    id. The present
    case is factually on all fours with Martinez.
    In this case, Perez raised the removal-by-waiver argument for the
    No. 01-50591
    -23-
    first time on appeal.   As in Martinez, the relevant inquiry is
    whether extraordinary circumstances exist to justify Perez's
    failure to raise the waiver argument in the district court.       We
    find no extraordinary circumstances in this case justifying
    Perez's failure to raise the argument and thus we do not consider
    whether Lapides means Region 20 waived its sovereign immunity.
    See Martinez, 
    2002 WL 1721803
    , at *7.     Put another way, Perez's
    claim that Region 20 waived its sovereign immunity has itself
    been waived.
    Perez also argues that Texas law waives Region 20's
    sovereign immunity.   Perez cites a provision of the Texas Labor
    Code which waives sovereign immunity for claims brought under the
    Texas Commission on Human Rights Act.     See TEX. LAB. CODE ANN. §§
    21.002(8)(D), 21.002(14)(A) (Vernon 1996 & Supp. 2002).      Perez
    contends that since a purpose of the Texas Labor Code is to
    "provide for the execution of the policies embodied in Title I of
    the Americans with Disabilities Act of 1990 and its subsequent
    amendments," 
    id. § 21.001(3),
    the Texas Labor Code's waiver of
    sovereign immunity for Texas Labor Code claims in state court
    waives sovereign immunity on federal ADA claims in federal court.
    It has long been settled that a state's waiver of its
    Eleventh Amendment immunity must be unequivocally expressed.
    See, e.g., Edelman v. Jordan, 
    415 U.S. 651
    , 673 (1974); Magnolia
    Venture Capital Corp. v. Prudential Sec., Inc., 
    151 F.3d 439
    ,
    443-44 (5th Cir. 1998).   A state's waiver of sovereign immunity
    in state court does not mean the state has waived Eleventh
    Amendment immunity in federal court.    See Martinez, 2002 WL
    No. 01-50591
    -24-
    1721803, at *7 (citing cases).     The section of the Texas Labor
    Code Perez cites does waive sovereign immunity for claims brought
    under the Labor Code in state court.     See Sauls v. Montgomery
    County, 
    18 S.W.3d 310
    , 313-15 (Tex. App.--Beaumont 2000, no
    pet.).   The Texas Labor Code, however, does not contain a clear
    and unequivocal waiver of immunity from suit with respect to the
    ADA, a distinct federal statute.     Further, the cited section does
    not expressly waive sovereign immunity in federal court.     Thus,
    Perez's contention that the Texas Labor Code waives Region 20's
    immunity in this case is meritless.
    The district court properly concluded that Eleventh
    Amendment immunity bars Perez's ADA claim.     Thus, we need not
    reach the merits of this claim.7
    D.   Texas Whistleblower Act Claim
    Perez's final claim is that Region 20 retaliated against him
    for reporting another employee's sexual harassment in violation
    of the Texas Whistleblower Act.     The Texas Whistleblower Act
    prevents a government employer from taking an adverse employment
    action against an employee who, in good faith, reports his
    employer's violation of law to an appropriate law enforcement
    7
    Perez contends that even if sovereign immunity applies
    to Region 20, it bars only his claim for money damages under the
    ADA, not his claim for injunctive relief. This argument
    misunderstands the nature of suits against states permitted in
    federal court under the Eleventh Amendment.
    Suits against state officials for prospective
    injunctive relief may be permitted in federal court. See
    
    Garrett, 531 U.S. at 374
    n.9; Ex Parte Young, 
    209 U.S. 123
    , 155-
    56 (1908); see also 
    Edelman, 415 U.S. at 664-65
    (distinguishing
    between prospective and retroactive injunctive relief). Perez,
    however, has sued only Region 20 itself and not any of its
    officers. Thus, Perez's argument that sovereign immunity does
    not bar injunctive relief in his case fails.
    No. 01-50591
    -25-
    agency.   TEX. GOV'T CODE ANN. § 554.002 (Vernon 1994 & Supp. 2002).
    The district court found that Perez's Whistleblower Act
    claim failed on the merits.     We need not address the merits of
    the Texas Whistleblower Act claim because this claim is barred by
    Eleventh Amendment immunity as well.8      The Texas Whistleblower
    Act waives sovereign immunity in state court.      See TEX. GOV'T CODE
    ANN. § 554.0035 (Vernon 1994 & Supp. 2002) ("Sovereign immunity
    is waived and abolished to the extent of liability for the relief
    allowed under this chapter for a violation of this chapter.").
    We recently held, however, that the Texas Whistleblower Act's
    waiver of sovereign immunity in Texas state court does not amount
    to a waiver of its sovereign immunity in federal court.       See
    Martinez, 
    2002 WL 1721803
    , at *7-8.     We noted that "[e]ven when a
    State consents to suit in its own courts, . . . it may retain
    Eleventh Amendment immunity from suit in federal court."       
    Id. at *7.
      We then examined the text of the waiver provision in the
    Whistleblower Act and concluded that the Act does not "evidence[]
    any intent by Texas to waive its Eleventh Amendment immunity and
    subject itself to suit in federal courts."      
    Id. Since we
    hold
    that Region 20 is an arm of the State of Texas, sovereign
    immunity bars Perez's claim under the Whistleblower Act.       We
    affirm summary judgment on this claim, though on different
    grounds that those cited by the district court.
    IV.    CONCLUSION
    8
    Although Region 20 did not argue that sovereign
    immunity bars the Texas Whistleblower Act claim, we may consider
    this issue sua sponte because it bears on this court's subject-
    matter jurisdiction. See Burge v. Parish of St. Tammany, 
    187 F.3d 452
    , 465-66 (5th Cir. 1999).
    No. 01-50591
    -26-
    The judgment of the district court is AFFIRMED.   All
    outstanding motions are DENIED as moot.
    

Document Info

Docket Number: 01-50591

Filed Date: 10/8/2002

Precedential Status: Precedential

Modified Date: 12/21/2014

Authorities (24)

Reeves v. Sanderson Plumbing Products, Inc. , 120 S. Ct. 2097 ( 2000 )

Board of Trustees of Univ. of Ala. v. Garrett , 121 S. Ct. 955 ( 2001 )

Lapides v. Board of Regents of Univ. System of Ga. , 122 S. Ct. 1640 ( 2002 )

College Savings Bank v. Florida Prepaid Postsecondary ... , 119 S. Ct. 2219 ( 1999 )

Sidna B. Gee v. Anthony Principi, Secretary, Department of ... , 289 F.3d 342 ( 2002 )

Cozzo v. Tangipahoa Parish Council-President Government , 279 F.3d 273 ( 2002 )

Celotex Corp. v. Catrett, Administratrix of the Estate of ... , 106 S. Ct. 2548 ( 1986 )

McDonnell Douglas Corp. v. Green , 93 S. Ct. 1817 ( 1973 )

Burge v. Parish of St. Tammany , 187 F.3d 452 ( 1999 )

Vogt v. Board of Commissioners , 294 F.3d 684 ( 2002 )

International Brotherhood of Teamsters v. United States , 97 S. Ct. 1843 ( 1977 )

76-fair-emplpraccas-bna-1392-73-empl-prac-dec-p-45396-wg , 138 F.3d 1053 ( 1998 )

Ussery v. Louisiana Ex Rel. Louisiana Department of Health &... , 150 F.3d 431 ( 1998 )

Daniels v. City of Arlington , 246 F.3d 500 ( 2001 )

Anderson v. Red River Waterway Commission , 231 F.3d 211 ( 2000 )

Magnolia Venture Capital Corporation v. Prudential ... , 151 F.3d 439 ( 1998 )

Pendergrass v. Greater New Orleans Expressway Commission , 144 F.3d 342 ( 1998 )

Davis v. Education Service Center , 2001 Tex. App. LEXIS 8046 ( 2001 )

Hudson v. City of New Orleans , 174 F.3d 677 ( 1999 )

Augusta Clark v. Tarrant County, Texas , 798 F.2d 736 ( 1986 )

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