Van Tiem v. First Amer Title ( 2021 )

Case: 20-40707 Document: 00516041000 Page: 1 Date Filed: 10/04/2021
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
October 4, 2021
No. 20-40707 Lyle W. Cayce
Clerk
Tonya Van Tiem,
Plaintiff—Appellant,
versus
First American Title Company;
First American Home Warranty Corporation;
First American Corporation;
Suzan Kelly, Individually,
Defendants—Appellees.
Appeal from the United States District Court
for the Eastern District of Texas
USDC No. 1:18-CV-458
Before Jones, Southwick, and Engelhardt, Circuit Judges.
Per Curiam:*
Plaintiff-Appellant Tonya Van Tiem challenges several rulings of the
district court that resulted in the dismissal of her claims against Defendants-
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 20-40707 Document: 00516041000 Page: 2 Date Filed: 10/04/2021
No. 20-40707
Appellees. For the following reasons, the judgment of the district court is
AFFIRMED.
I. BACKGROUND
Tonya Van Tiem worked as a sales representative for First American
Home Warranty Corporation (“First American”). During her employment,
various disputes arose stemming from Van Tiem’s belief that her orders were
being wrongfully redirected, reassigned, and misappropriated to other
accounts, resulting in an alleged reduction of her “numbers, bonuses, and
compensation.” In 2017, she resigned.
In 2018, Van Tiem sued First American, First American Title Co.
(“FATCO”), First American Corporation (collectively, the “corporate
Defendants”), and a former colleague, Suzan Kelly, in state court for fraud,
conspiracy to commit fraud, breach of contract, tortious interference with
existing and prospective contracts, and intentional infliction of emotional
distress. Both Kelly and Van Tiem are citizens of Texas. First American and
FATCO are California corporations, and First American Corporation is a
Delaware corporation. Defendants removed the case on the basis of diversity
jurisdiction, arguing that Kelly, the only non-diverse defendant, was
improperly joined. Van Tiem filed a motion to remand the case back to state
court, which the district court denied. In the same order, the district court
disregarded Kelly’s citizenship for the purpose of determining diversity
jurisdiction and dismissed the claims against Kelly without prejudice.
Van Tiem amended her complaint. The remaining Defendants
moved to dismiss her claims, a motion the court granted for all claims except
the breach-of-contract claim against First American. Months later, the court
resolved the remaining breach-of-contract claim in favor of the First
American on summary judgment and entered final judgment on August 6,
2020.
2
Case: 20-40707 Document: 00516041000 Page: 3 Date Filed: 10/04/2021
No. 20-40707
On September 3, Van Tiem filed a motion for a new trial. Because no
trial had taken place, the district court construed the motion as two separate
motions—a Rule 59(e) motion and a Rule 60(b) motion. The court reasoned
that Van Tiem filed her motion twenty-eight days after the entry of final
judgment, so the portion of the motion contesting summary judgment should
be adjudicated under Rule 59(e). But, because the portion seeking relief from
the earlier Rule 12(b)(6) dismissal was not filed “within twenty-eight days of
the judgment or order of which the party complains,” the district court
construed that request as falling within Rule 60(b). The district court denied
relief from summary judgment under Rule 59(e). The court denied relief for
the remainder of Van Tiem’s motion as untimely under Rule 60(b), as it was
“filed more than one year after her fraud claims were dismissed.” On
October 18, twenty-seven days after the district court denied the motion for
a new trial, Van Tiem filed her notice of appeal. 1
II. STANDARD OF REVIEW
This court conducts de novo review of both denials of motions to
remand and grants of motions to dismiss. See Badgerow v. Walters, 975 F.3d
469, 472 (5th Cir. 2020) (motions to remand); Jebaco, Inc. v. Harrah’s
Operating Co., 587 F.3d 314, 318 (5th Cir. 2009) (motions to dismiss).
Further, this court has “an independent duty to determine [its] jurisdiction
over any case presented to [it] for decision.” Colle v. Brazos Cnty., 981 F.2d
237, 240 (5th Cir. 1993).
III. DISCUSSION
On appeal, Van Tiem challenges (1) the district court’s denial of her
motion to remand; (2) its dismissal of her claims against Kelly; and (3) its
1
In her briefing, Van Tiem did not appeal the district court’s grant of summary
judgment for First American on the breach-of-contract claim.
3
Case: 20-40707 Document: 00516041000 Page: 4 Date Filed: 10/04/2021
No. 20-40707
dismissal of her claims against the corporate Defendants. Defendants add a
jurisdictional challenge, contending that Van Tiem’s notice of appeal was
untimely filed more than a year after entry of the dismissal order to which it
was directed. Rule 60(b) motions must ordinarily be filed within a year of the
entry of judgment. FED. R. CIV. P. 60(c)(1). The timeliness of Van Tiem’s
appeal and the district court’s denial of her motion to remand implicate this
court’s jurisdiction and are analyzed first. 2
A. Timeliness of Van Tiem’s Appeal
The issue undergirding the timeliness of Van Tiem’s appeal is one of
interpretation. Both the Defendants and the district court effectively
assumed, for different purposes, that “judgment” as used in the Federal
Rules of Civil Procedure and the Federal Rules of Appellate Procedure
includes non-final orders entered by the district court. That assumption is
incorrect.
Defendants argue that Van Tiem’s notice of appeal is untimely
because it was filed more than one year—the maximum amount of time
permitted under Rule 60(b)—after entry of the dismissal order to which it
was directed. In other words, since Van Tiem appeals only the district
court’s 12(b)(6) dismissal order, Defendants argue that Van Tiem’s
opportunity to challenge the earlier dismissals has lapsed. Defendants’
argument is based on the district court’s bifurcated disposition of Van
2
Defendants filed a motion asking this court to strike Van Tiem’s arguments in
support of jurisdiction because they were not raised in her opening brief. We deny this
request. Just as objections to subject-matter jurisdiction can never be waived, neither can
arguments responding to such objections. Colbert v. Brennan, 752 F.3d 412, 416 (5th Cir.
2014) (“Because this is a jurisdictional issue, it cannot be waived or forfeited.” (citing
Bowles v. Russell, 551 U.S. 205, 213, 127 S. Ct. 2360, 2366 (2007))). Regardless, this court
has an independent responsibility to evaluate its jurisdiction. FW/PBS, Inc. v. City of
Dallas, 493 U.S. 215, 231, 110 S. Ct. 596, 607 (1990).
4
Case: 20-40707 Document: 00516041000 Page: 5 Date Filed: 10/04/2021
No. 20-40707
Tiem’s motion for new trial under Rules 59(e) and 60(b). Mindful of the
different deadlines in each rule, the district court assumed there were two
different “judgment” dates.
But the proper interpretation of “judgment” includes only appealable
orders. A “judgment” is “any order from which an appeal lies.” FED. R.
CIV. P. 54(a). This includes any final decision from which an appeal is
permitted under 28 U.S.C. § 1291, or any appealable interlocutory order. See
Swope v. Columbian Chems. Co., 281 F.3d 185, 191 (5th Cir. 2002); Ronel Corp.
v. Anchor Lock of Fla., Inc., 312 F.2d 207, 208 (5th Cir. 1963). Because the
district court’s denial of remand and dismissals of the claims against Kelly
and the corporate Defendants fit in neither category, they do not qualify as
“judgments.” See Williams v. Seidenbach, 958 F.3d 341, 343 (5th Cir. 2020)
(en banc) (“[I]n a suit against multiple defendants, there is no final decision
as to one defendant until there is a final decision as to all defendants.”).
Consequently, Van Tiem’s motion for a new trial should have been
construed as a Rule 59(e) motion in its entirety. Rule 59(e) provides that a
motion to alter or amend a judgment may be made “no later than 28 days
after the entry of the judgment.” FED. R. CIV. P. 59(e) (emphasis added).
The only “judgment” in this case was the district court’s final judgment on
August 6, and Van Tiem filed her motion within the 28-day window
permitted under Rule 59(e). Mangieri v. Clifton, 29 F.3d 1012, 1015 n.5 (5th
Cir. 1994) (“A motion for reconsideration is deemed to arise under Rule 59
if filed within rule 59’s . . . time limit regardless of the label applied to the
motion.” (internal quotations omitted)).
Here, the record indicates no entry of final judgment as to any of the
parties or claims until the judgment was entered on August 6, 2020. Neither
the order dismissing Van Tiem’s claims against Kelly nor the order
dismissing her claims against the corporate Defendants include any
5
Case: 20-40707 Document: 00516041000 Page: 6 Date Filed: 10/04/2021
No. 20-40707
indication that the district court intended to certify Rule 54(b) final
judgments as it pertained to those dismissals. Therefore, the dismissals
remained “prejudicial adverse interlocutory rulings” that were
nonreviewable until they “merged into the final judgment terminating the
action.” See Diece-Lisa Indus., Inc. v. Disney Enters., Inc., 943 F.3d 239, 247
(5th Cir. 2019). Accordingly, Van Tiem’s motion for new trial is properly
understood in its entirety as a timely Rule 59(e) motion.
The consequence is that Van Tiem’s appeal is timely. “The filing of
a Rule 59(e) motion within the 28-day period suspends the finality of the
original judgment for purposes of an appeal.” Banister v. Davis, 140 S. Ct.
1698, 1703 (2020) (internal quotations omitted). It is only upon the
resolution of that motion that the finality of the judgment is restored and the
“30-day appeal clock” starts again. Id. Here, Van Tiem timely filed her
notice of appeal twenty-seven days after the district court denied her motion.
B. Motion to Remand
Remand of a case removed to federal court is proper when the federal
court determines it lacks subject-matter jurisdiction. See 28 U.S.C.
§§ 1441(a), 1447(c). “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).
Ambiguities should be strictly construed in favor of remand. Id.Because Van Tiem and Kelly are non-diverse, removal was proper
only if Kelly was improperly joined. See Lincoln Prop. Co. v. Roche, 546 U.S.
81, 89, 126 S. Ct. 606, 613 (2005) (describing the complete diversity
requirement). The federal removal statute, 28 U.S.C. § 1441(a), authorizes
removal of “any civil action brought in a State court of which the district
courts of the United States have original jurisdiction;” but subsection (b)(2)
specifies that suits not arising under federal law are removable “only if none
6
Case: 20-40707 Document: 00516041000 Page: 7 Date Filed: 10/04/2021
No. 20-40707
of the parties in interest properly joined and served as defendants is a citizen
of the State in which such action is brought.” Smallwood v. Ill. Cent. R.R. Co.,
385 F.3d 568, 572 (5th Cir. 2004) (en banc) (quoting 28 U.S.C. § 1441(b))
(emphasis in original).
To determine whether a nondiverse defendant was improperly joined,
a district court must determine whether “the defendant has demonstrated
that there is no possibility of recovery by the plaintiff against an in-state
defendant.” 3 Int’l Energy Ventures Mgmt., L.L.C. v. United Energy Grp., Ltd.,
818 F.3d 193, 200 (5th Cir. 2016) (quoting Smallwood, 385 F.3d at 573). The
court follows a Rule 12(b)(6)-type analysis. Id. at 207–08. But “the focus of
the inquiry must be on the joinder, not the merits of the plaintiff’s case.”
Smallwood, 835 F.3d at 573.
The district court concluded that Kelly was improperly joined after
conducting a thorough claim-by-claim analysis that applied the relevant
pleading standards and applicable law. We briefly address why each of the
claims against Kelly was insufficiently plead and therefore had “no possibility
of recovery.”
1. Fraud
Van Tiem contends she met Rule 9(b)’s heighted standard for
pleading fraud because the state court petition provided the “who, what,
when, where, and how” of the alleged fraud. She points to allegations that
“Defendants, including Suzan Kelly ‘redirected, reassigned, and
3
Van Tiem argues that Texas pleading standards apply to our evaluation of
improper joinder. This court’s precedent establishes that the contrary is true. Int’l Energy
Ventures Mgmt., L.L.C. v. United Energy Grp., Ltd., 818 F.3d 193, 202 (5th Cir. 2016) (“So,
in a case that has been removed to federal court on the basis of diversity, the determinative
question is whether—under federal law—a nondiverse defendant was improperly joined.”
(emphasis in original)).
7
Case: 20-40707 Document: 00516041000 Page: 8 Date Filed: 10/04/2021
No. 20-40707
misappropriated’ Van Tiem’s orders.” And she alleged that these orders
would be moved to house accounts or cancelled and re-logged to other
employees. Further, Van Tiem emphasized that she brought this to the
attention of her supervisors, “namely Kelly,” who “began to retaliate” by
manipulating more orders, making false claims about Van Tiem’s sales
numbers, and trying to revoke a “sales award previously given.” She
emphasizes that Kelly “spearheaded” the effort against her.
Van Tiem argues that, on these allegations, the district court erred in
three specific ways. First, the court erred by assuming an affirmative
representation is required to plead fraud when deceptive conduct is enough.
Second, the court erred by missing the fact that Van Tiem pled a viable fraud
by non-disclosure claim. Third, that Van Tiem did, in fact, allege an
affirmative misrepresentation by stating that Defendants, inter alia, “claimed
that Van Tiem was mistaken, there was no problem, and that Van Tiem
simply did not know how to read the reports.”
The first two arguments were not raised before the district court in
Van Tiem’s motion to remand. In fact, in that motion Van Tiem set forth
the very elements of fraud—including the requirement of a material
misrepresentation—cited by the court and now criticized on appeal. Thus,
to the extent the district court “missed on Texas law demanding an
affirmative representation to maintain a fraud claim,” it was arguably relying
on Van Tiem’s own characterization of the applicable law in her motion for
remand.
Regardless, the district court did not “miss” the fact that fraud in
Texas can be based on concealment or non-disclosure. It expressly
8
Case: 20-40707 Document: 00516041000 Page: 9 Date Filed: 10/04/2021
No. 20-40707
recognized this possibility. 4 At bottom, though, the district court could not
identify “any misrepresentations made by Kelly” alleged in the petition.
This conclusion was correct. Notwithstanding its general averment that
“Defendants fraudulently schemed” by “re-directing, reassigning and
misappropriating” Van Tiem’s clients’ orders, the Original Petition failed to
allege any specific misrepresentation made by Kelly (or any defendant) that
Van Tiem relied upon. Even the examples of fraud by concealment or non-
disclosure raised by Van Tiem in her brief provide the specific acts relied
upon to form the basis of the fraud claim (e.g., “lighting a scented candle to
mask a permanent, offensive odor,” and “swapping a document to convey a
piece of land different from what was intended”). 5 Nothing so specific was
alleged in the pleading. Thus, the district court did not err in concluding Van
Tiem’s Original Petition failed to state a claim of fraud for improper joinder
purposes.
2. Conspiracy to Commit Fraud
Van Tiem’s arguments with respect to conspiracy fare no better. As
a threshold matter, to the extent the Original Petition failed to allege fraud it
4
Its focus on Defendants’ alleged “material misrepresentations” is
understandable given alleged “material misrepresentations” were mentioned multiple
times in the short portion of the Original Petition titled “Fraud/Conspiracy to Commit
Fraud.”
5
Nor does the Original Petition state a claim under the elements of fraud by non-
disclosure presented in Van Tiem’s appellate briefing. For example, the petition does not
specify the “non-disclosure” that she “relied on” that “resulted in injury.” Nor did she
allege particularized facts suggesting Defendants intended Van Tiem “to act or refrain
from acting based on the nondisclosure.” And Van Tiem did not specifically explain what
“material facts” Defendants “deliberately failed to disclose.” What material facts about
this process were concealed from Van Tiem that she relied upon? Her conclusory
allegations are not enough. Nor is generally asserting these efforts were “spearheaded by
Kelly.”
9
Case: 20-40707 Document: 00516041000 Page: 10 Date Filed: 10/04/2021
No. 20-40707
a fortiari failed to allege conspiracy to commit fraud. But even setting that
aside, the petition did not sufficiently allege a conspiracy specific to Kelly.
Van Tiem concedes that Kelly could not have conspired with her
employer, First American, because Kelly was the employer’s agent. But Van
Tiem argues that, because the other two corporate defendants were distinct
legal entities from First American, Kelly could conspire with them.
Nevertheless, the Original Petition lacks any specific facts about this
supposed conspiracy. At best, it generally alleges that “Defendants, jointly
and severally, conspired to fraudulently acquire [Van Tiem’s] placements
through their numerous misrepresentations.” But it is entirely bereft of any
specific misrepresentations made by a particular defendant, much less factual
allegations supporting a conspiracy between the three corporate defendants.
3. Tortious Interference with Contract
Van Tiem attacks the district court’s decision on tortious interference
on two grounds. First, she contends that tortious interference with a
prospective contract does not require “any contract exist or that the defendant
be a third party to the transaction.” Second, she contends the Original
Petition did allege “that Kelly’s conduct was independently tortious.” She
contends it did so by alleging that “Defendants, including Kelly, ‘began
denigrating plaintiff’ with ‘false and malicious representations’ to her
clients” and by “providing fraudulent, ‘slanderous statements and
information’ to Van Tiem’s professional contacts.”
As to the first argument, Van Tiem is right in part—by definition
interference with a prospective contract does not require an existing contract.
But Van Tiem points to no example of such a claim applying to tortious
interference with a defendant’s own prospective contract with a third party.
That makes little sense. What Van Tiem seems to be arguing is that Kelly’s
tortious interference with prospective contracts was not interference with
10
Case: 20-40707 Document: 00516041000 Page: 11 Date Filed: 10/04/2021
No. 20-40707
contracts that Van Tiem was procuring on behalf of First American. Rather,
as she makes clear in her second point, Van Tiem contends Kelly, and the
other defendants, interfered in her personal ability to enter into prospective
contracts with potential clients after she no longer worked for First
American.
But the Original Petition only alleged tortious interference with her
contracts while she was employed by First American. The facts relating to
post-employment retaliation were applied in the context of her IIED claim.
And even if those facts were considered as applied to tortious interference
with prospective contracts, Van Tiem provides nothing more than
conclusory allegations. She does not point to specific statements (of Kelly or
any defendant), name a single potential client, or allege any facts to support
a conclusion that Van Tiem would have entered into a business relationship
with a particular third party but for such interference. In short, she does not
sufficiently allege facts to satisfy the elements of interference with
prospective business relationships. 6
4. IIED
Van Tiem does not dispute the district court’s characterization of the
legal standard for IIED claims. Rather, she focuses on supporting the
6
See D’Onofrio v. Vacation Publ’ns, Inc., 888 F.3d 197, 218 (5th Cir. 2018) (“The
elements of tortious interference with a prospective business relationship are that (1) there
was a reasonable probability that the plaintiff would have entered into a business
relationship with a third party; (2) the defendant either acted with a conscious desire to
prevent the relationship from occurring or knew the interference was certain or
substantially certain to occur as a result of the conduct; (3) the defendant’s conduct was
independently tortious or unlawful; (4) the interference proximately caused the plaintiff
injury; and (5) the plaintiff suffered actual damage or loss as a result.” (quotation marks
and citation omitted)).
11
Case: 20-40707 Document: 00516041000 Page: 12 Date Filed: 10/04/2021
No. 20-40707
possibility that the alleged conduct was “extreme and outrageous.”
Alternatively, Van Tiem suggests that the district court improperly applied
the application of IIED as a “gap filler” because it ultimately disposed of all
of the alternative claims for relief. But she does nothing to refute the case law
cited by the district court that a plaintiff cannot assert an IIED claim merely
because of her inability to prevail on another theory of relief designed to
address the gravamen of the plaintiff’s complaint. See, e.g., Creditwatch, Inc.
v. Jackson, 157 S.W.3d 814, 815–16 (Tex. 2005) (describing IIED
requirements as “exacting,” a “gap-filler,” and recognizing that when a
plaintiff’s “complaints are covered by other statutory remedies, she cannot
assert them as intentional infliction claims just because those avenues may
now be barred”). And the facts alleged in the Original Petition do not come
close to pleading the elements required of an IIED claim. 7 Id. at 818
(“[E]xcept in circumstances bordering on serious criminal acts, we repeat
that such acts will rarely have merit as intentional infliction claims.”).
We find no error of fact or law in the court’s decision to deny remand.
C. Motion to Dismiss for Failure to State a Claim
Van Tiem also challenges the district court’s grant of the corporate
Defendants’ motion to dismiss all but one of her claims (the remaining one
having been the subject of an un-appealed adverse summary judgment).
When considering a motion to dismiss, this court views “the facts as pled in
the light most favorable to the nonmovant” and judges whether the
7
To establish a cause of action for IIED, a plaintiff must demonstrate that: (1) the
defendant acted intentionally or recklessly; (2) the defendant’s conduct was extreme and
outrageous; (3) the defendant’s actions caused the plaintiff emotional distress; and (4) the
emotional distress suffered by the plaintiff was severe. Brennan v. Mercedes Benz USA,
388 F.3d 133, 136 (5th Cir. 2004).
12
Case: 20-40707 Document: 00516041000 Page: 13 Date Filed: 10/04/2021
No. 20-40707
complaint alleges “more than labels and conclusions.” Jebaco, 587 F.3d at
318 (internal citations omitted).
Van Tiem’s arguments relating to the district court’s dismissal of the
fraud, conspiracy to commit fraud, tortious interference with contracts, and
IIED claims for the remaining defendants generally follow the arguments
made with respect to Kelly’s improper joinder. But a few distinct points bear
mentioning.
With respect to the fraud claims, Van Tiem takes issue with the
district court’s conclusion that FATCO and First American Corporation
were not a party to the compensation plan and, thus, could not be liable for
fraud. Van Tiem argues that a direct contractual relationship isn’t required
“so long as the defendant partakes in and benefits from the fraud.” In
context, the district court was addressing Van Tiem’s position that First
American executed the compensation plan “with no intent to pay
commissions or give her credit for the orders she secured on its behalf.” The
district court concluded the complaint gave only “threadbare recitals of the
elements of a cause of action.” On top of that, the court observed that there
was no indication that “FATCO and First American” Corporation were
“party to” the compensation plan, thus “there is no allegation that any
Defendant other than [First American] made any material representations to
Van Tiem.” This can be fairly construed as finding no sufficiently
particularized allegation that FATCO and First American Corporation
“partook in” the alleged fraud. Whatever the circumstances may be where
non-parties to a contract can be liable for fraud without making any material
misrepresentations themselves, this case is not it.8
8
Van Tiem similarly argues that she alleged a conspiracy among multiple parties
because she alleged that Defendants jointly perpetrated the alleged fraud. But this
argument misses the point: The First Amended Complaint’s conclusory allegations of
13
Case: 20-40707 Document: 00516041000 Page: 14 Date Filed: 10/04/2021
No. 20-40707
With respect to tortious interference, Van Tiem argues that First
American (warranties), FATCO (titles), and First American Corporation
(human resources and legal), all worked together to “conceal the scheme,”
and that this means there is “a viable basis of recovery for tortious
interference.” But this misses the point that the “allegations” in the
complaint were conclusory in nature. The factual heart of the complaint
were the allegations that First American was not paying Van Tiem in
accordance with their mutually agreed upon compensation plan. That
breach-of-contract claim was not dismissed. It was disposed of at summary
judgment only after Van Tiem completely failed to adduce any evidence of a
single improperly attributed order. And Van Tiem does not appeal that
ruling.
Here again, after careful review of the record, this court finds no error
of fact or law requiring reversal of the district court’s meticulous order.
For the foregoing reasons, the judgment of the district court is
AFFIRMED. 9
jointly perpetrated fraud are insufficient to allege specific facts to support a claim of
conspiracy. Simply saying the word “jointly” is not enough. Van Tiem tries to flesh out
the role of the various defendants in her brief, but these details weren’t alleged in her
complaint.
9
Appellees’ motion to strike arguments made in Appellant’s Reply Brief is
DENIED.
14