Martin v. The Kroger Company ( 2000 )

UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 99-20989
Summary Calendar
ELAINE MARTIN,
Plaintiff-Appellant,
VERSUS
THE KROGER COMPANY; CHARLES HEMBREE,
Defendants-Apellees,
Appeal from the United States District Court
For the Southern District of Texas
June 23, 2000
Before JOLLY, DAVIS, and EMILIO M. GARZA, Circuit Judges.
DAVIS, Circuit Judge:*
This is an appeal from the district court’s entry of summary
judgment dismissing Plaintiff Elaine Martin’s claims against the
Kroger Corporation and Charles Hembree, a Kroger employee. In her
*
Pursuant to 5TH CIR. R. 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opinion should not be published and is not precedent except under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 CIR. R. 47.5.4.
complaint, Martin alleged that Kroger and Hembree violated the
Texas Labor Code by committing sex discrimination, race
discrimination, unlawful retaliation, negligent retention, and
several wage and hour violations. Martin also asserted causes of
action against Hembree for intentional infliction of emotional
distress and tortious interference with existing and prospective
business relations. The district court entered summary judgment
disposing of all of Martin’s claims. She appeals, arguing that:
(1) the district court lacked subject matter jurisdiction and (2)
the district court erred in granting summary judgment despite the
presence of substantial issues of material fact. For the reasons
that follow, we affirm the judgment of the district court.
I.
Kroger is a retail grocery chain with a number of stores in
the Houston, Texas area. Elaine Martin, a black female, worked as
an engineer for Kroger between 1993 and 1998. She was the only
female and only black engineer who worked under the supervision of
Charles Hembree, a white manager. Martin had never worked as an
engineer prior to her employment with Kroger and frequently
received mediocre evaluations, often stressing her lack of
leadership skills and suggesting that she learn more about the
technical aspects of her job.
Martin alleges that during her tenure with Kroger, she
witnessed a number of employees, including Hembree, make derogatory
statements about women and minorities. She also contends that
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Hembree criticized her work and favored white employees. She
states that she complained to Hembree but he did nothing to
alleviate these problems. She further alleges that Hembree
wrongfully placed her on probation, and ultimately terminated her,
because she complained about the way Kroger treated minority
employees and subcontractors. Finally, she contends that Hembree
provided a negative reference for her, which precluded her from
gaining employment with H.E.B. grocery stores.
Martin filed a complaint with the EEOC but chose to pursue in
court only the state-law claims. Kroger and Hembree removed the
case, claiming diversity jurisdiction under 28 U.S.C. § 1332 and
alleging that Martin had fraudulently joined Hembree. Martin
neither filed a motion to remand nor otherwise opposed the removal.
Kroger and Hembree moved for summary judgment on all claims.
Prior to the summary judgment hearing, Martin voluntarily dismissed
her claims for negligent retention and hiring, Texas wage and hour
violations, and intentional infliction of emotional distress. The
district court entered summary judgment against the remaining
claims.
II.
Martin argues that the district court lacked subject matter
jurisdiction to hear this case because this case does not involve
a federal question and because the parties were not completely
diverse. She explains that complete diversity does not exist
because both she and Hembree are citizens of Texas.
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Kroger contends that Martin fraudulently joined Hembree in
order to defeat diversity jurisdiction. They argue that Martin
failed to establish any possibility that she could prevail on any
of her causes of action against Hembree -- sex and race
discrimination, intentional infliction of emotional distress, or
tortious interference with existing and prospective business
relations.
Although Martin neither filed a motion to remand nor otherwise
challenged jurisdiction prior to her appeal, “a party may neither
consent to nor waive federal subject matter jurisdiction. Federal
courts may examine the basis of jurisdiction sua sponte, even on
appeal.” Simon v. Wal-Mart Stores, Inc., 193 F.3d 848, 850 (5th
Cir. 1999); Baris v. Sulpicio Lines, Inc., 932 F.2d 1540, 1546 (5th
Cir. 1991)(“It is beyond doubt that although the parties can waive
defects in removal, they cannot waive the requirement of original
subject matter jurisdiction – in other words, they cannot confer
jurisdiction where Congress has not granted it.”).
In reviewing a district court’s exercise of removal
jurisdiction, we generally consider whether the district court had
jurisdiction at the time of removal. Miranti v. Lee, 3 F.3d 925,
928 (5th Cir. 1993). However, “an alternative standard governs those
situations where, after improper removal, a case is tried on the
merits without objection, and the federal court enters judgment.”
Kidd v. Southwest Airlines, 891 F.2d 540, 546 (5th Cir. 1990). In
those circumstances, “the appellate court must review the pleadings
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as they exist at the time that the district court enters judgment,”
rather than at the time of removal. Id. Because Martin failed to
contest jurisdiction prior to the district court’s entry of
judgment, we consider only the claims in controversy when the
district court entered its verdict -- discrimination/retaliation
and interference with current/prospective business relations.
Diversity jurisdiction exists where the matter in controversy
exceeds $75,000 and where every plaintiff is from a different state
as every defendant. See 28 U.S.C. § 1332; Strawbridge v. Curtiss,
7 U.S. 267 (1806). A plaintiff may not, however, “fraudulently
join” a defendant in order to defeat diversity. See Jerrigan v.
Ashland Oil, Inc., 989 F.2d 812, 817 (5th Cir. 1993). In order to
demonstrate that Martin has fraudulently joined Hembree, Kroger
must demonstrate either “outright fraud in the plaintiff’s
recitation of jurisdictional facts or that there is absolutely no
possibility that the plaintiff will be able to establish a cause of
action against the in-state defendant in state court.” Rodriguez
v. Sabatino, 120 F.3d 589, 591 (5th Cir. 1997).
In analyzing a claim of fraudulent joinder, this Court applies
“a summary-judgment like procedure” and may consider “summary
judgment-type evidence such as affidavits and deposition
testimony.” Griggs v. State Farm Lloyds, 181 F.3d 694, 700 (5th
Cir. 1999). We must “evaluate all of the factual allegations in
the plaintiff’s state court pleadings in the light most favorable
to the plaintiff, resolving all contested issues of substantive
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fact in favor of the plaintiff[,] and examine relevant state law
and resolve all uncertainties in favor of the non-removing party.”
Rodriguez, 120 F.3d at 591. We do not consider “whether the
plaintiff will actually or even probably prevail on the merits of
the claim” but instead “look only for a possibility that the
plaintiff may do so.” Id. As such, we will consider each of
Martin’s claims in turn.
Martin’s primary claim against Hembree is for race and sex
discrimination and retaliation under the Texas Commission on Human
Rights Act (“TCHRA”). After reviewing the pleadings and relevant
case law, we conclude that there is no possibility that Martin will
prevail on this claim. Martin’s claims against Hembree arise
solely from his actions as a supervisory employee of Kroger,
however, [s]upervisors and managers . . . are not liable under the
Texas Human Rights Act in their individual capacity for their
alleged acts of discrimination.” DeMoranville v. Specialty
Retailers, Inc., 909 S.W.2d 90, 94 (Tex. App. 1995)(reversed on
other grounds); accord City of Austin v. Gifford, 824 S.W.2d 735,
742 (Tex. App. 1992)(“The Act does not create a cause of action
against supervisors or individual employees”); Thompson v. City of
Arlington, 838 F. Supp. 1137, 1153 (N.D. Tex. 1993). Individual
employees, even those with supervisory authority, do not fall
within the TCHRA’s definition of “employer.” See Tex. Lab. Code §
21.002(8)(A)(defining “employer”). Accordingly, Martin’s TCHRA
claims against Hembree cannot provide the basis for diversity
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jurisdiction.
Martin also alleges that Hembree tortiously interfered with
her current business relationship with Kroger and her prospective
business relationship with H.E.B. The district court entered
summary judgment against both of these claims, finding that Martin
failed to present a prima facie case of either tortious
interference with a current business relationship or tortious
interference with a prospective business relationship.
To the extent that Martin’s tortious interference claims
simply repackage her discrimination/retaliation claims, they are
foreclosed by the TCHRA. As courts have explained, the “TCHRA
provides the exclusive state-law means for redress of employment
discrimination and preempts claims for discrimination brought under
other state-law theories” see Cook v. Fidelity Investments, 908
F. Supp. 438, 442 (N.D. Tex. 1995). To the extent that Martin’s
tortious interference claims stand on their own, they are
insufficient as a matter of law.
In order to make out a claim of tortious interference with a
contract, the plaintiff must demonstrate: “(1) the existence of a
contract subject to interference; (2 )willful and intentional
interference; (3) interference that proximately caused damage; and
(4) actual damage or loss.” Powell Indus., Inc. v. Allen, 985
S.W.2d 455, 456 (Tex. 1998). Where the plaintiff alleges that an
agent of her current employer has interfered with her contract with
that employer, the plaintiff must establish that “the agent acted
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willfully and intentionally to serve the agent’s personal interets
at the corporation’s expense.” Id. at 457. “A corporate officer’s
mixed motives -- to benefit both himself and the corporation -- are
insufficient to establish liability.” Powell Indus., Inc. v.
Allen, 985 S.W.2d 455 (Tex. 1998). Furthermore, “if a corporation
does not complain about it’s agents actions, then the agent cannot
be held to have acted contrary to the corporation’s interests.”
Id.
Martin has failed to allege any facts suggesting that Hembree
interfered with her relationship with Kroger. In her affidavit,
Martin avers only that Hembree failed to control the racist
environment, that he stated that he had grown up thinking it was
acceptable to refer to blacks as “niggers,” and that she had heard
that Hembree was racist and would try and get rid of her. In her
deposition, Martin stated that Hembree tortiously interfered with
her relationship with Kroger because: “he allowed Terry
[Hillebrandt’s] demeaning behavior to continue even when, you know,
I would come – I felt so neglected, out of place in the engineering
department once I filed a charge. . . . We didn’t socialize. And
so – and I feel that . . . someone talked to the engineers. The
engineers didn’t want to socialize and talk to me about anything.
. . .” Martin simply has not stated any basis for tortious
interference with a current contract apart from the
race/retaliation claims. Furthermore, Martin has never alleged
that Hembree terminated her employment because of his own personal
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interests, rather than the interests of Kroger. Nor has she
alleged that Kroger expressed displeasure with Hembree’s decision
to terminate her. Accordingly, there is no possibility that Martin
could succeed on her claim for tortious interference with a current
business relationship.
Similarly, there is no possibility that Martin will prevail on
her claim for tortious interference with a prospective business
relationship. In order to prove a cause of action for interference
with a prospective contract under Texas law, the plaintiff must
show that: (1) there was a reasonable probability that the
plaintiff would have entered into a contractual relationship; (2)
the defendant committed a malicious and intentional act that
prevented the relationship from occurring, with the purpose of
harming the plaintiff; and (3) actual harm or damage resulted from
the defendant’s interference. See Gaia Technologies, Inc. v.
Recycled Products Corp., 175 F.3d 365, 377 (5th Cir. 1999)(citing
Texas case law). “It is not necessary to prove that the contract
certainly would have been made but for the interference; it must be
reasonably probable, considering all of the facts and circumstances
attendant to the transaction.” Hill v. Heritage Resources, Inc.,
964 S.W.2d 89, 109 (Tex. App. 1997). However, “[m]ore than mere
negotiations must have taken place.” Id.
Martin has not alleged any facts suggesting that she and
H.E.B. had even entered into discussions concerning employment, let
alone that her employment with H.E.B. was “reasonably probable.”
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Martin alleges simply that she had a “pre-interview” with an H.E.B.
human resources representative, that the representative told her
that they needed to check out her references, and that ultimately
H.E.B. did not hire her. Furthermore, Martin failed to allege in
her complaint that she was reasonably likely to obtain employment
but for Hembree’s actions. Finally, Martin conceded in her
deposition that “I have no evidence that [Hembree] talked to
H.E.B.” and that “I have no evidence or facts” suggesting that
anyone at Kroger spoke to H.E.B. Even “[c]onstruing, as we must,
all disputed facts in the plaintiff’s favor,” Carriere v. Sears,
Roebuck & Co., 893 F.2d 98, 101 (5th Cir. 1990), there is simply no
possibility that Martin could have made out a claim for tortious
interference with a prospective business relationship. See Griggs
v. State Farm Lloyd’s, 181 F.3d 694, 702 (5th Cir. 1999)(finding
that plaintiff fraudulently joined defendant where they could not
possible recover on their claims).
Because there is no possibility that Martin will prevail on
any of her claims against Hembree, we hold that the district court
properly exercised subject matter jurisdiction
II.
Martin argues that the district court erred in entering
summary judgment on her retaliation claim. She contends that the
district court overlooked substantial issues of material fact
regarding whether Kroger terminated her because of her poor
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performance, or because of her pattern of opposition to
discriminatory practices.
The district court found that Martin had established a prima
facie case of discrimination because she had proved that: (1) she
opposed a discriminatory practice – the use of racial slurs; (2)
she suffered an adverse employment decision – termination; and (3)
she established causation – by a temporal proximity between her
complaints and her discharge. Nevertheless, the court held that
Kroger provided “ample evidence of non-retaliatory reasons for
Martin’s discharge, i.e., her poor performance and negative
attitude. . . .” Because Martin failed to show that the reasons
that Kroger proffered for her discharge were pretextual and that
Kroger actually sought to fire her because of her opposition to
discrimination, the district court granted summary judgment for
Kroger.
Our review of the briefs and record leads us to agree with the
district court. Once a plaintiff has advanced a prima facie case
for retaliation and the defendant has “articulate[d] a legitimate,
nondiscriminatory reason for the challenged employment action,” a
plaintiff can avoid summary judgment only if “the evidence, taken
as a whole: (1) creates a fact issue as to whether each of the
employer’s stated reasons was not what actually motivated the
employer and (2) creates a reasonable inference that race was a
determinative factor in the actions of which plaintiff complains.”
Grimes v. Texas Dept. of Mental Health and Mental Retardation, 102
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F.3d 137, 140-41 (5th Cir. 1996). Moreover, the “plaintiff must
present sufficient evidence to create a discriminatory intent in
order to avoid summary judgment.” Id. at 141. And as in response
to any motion for summary judgment, “it is . . . incumbent upon the
non-moving party to present evidence – not just conjecture and
speculation – that the defendant retaliated and discriminated
against plaintiff on the basis of her race.” Id. at 140.
In response to Martin’s prima facie showing of retaliation,
Kroger produced substantial evidence documenting Martin’s work
difficulties, which substantially preceded her discrimination
charges. Martin failed to produce any evidence either suggesting
that Kroger did not actually fire her on the basis of her poor
performance or that Kroger fired her because of her opposition to
discrimination. At best, Martin has demonstrated a temporal
proximity between her complaints and her termination. While such
a showing may be sufficient to establish a prima facie case, it
does not constitute evidence “sufficient to create a reasonable
inference of discriminatory intent in order to avoid summary
judgment.” 102 F.3d at 141.
III.
For the foregoing reasons, the judgment of the district court
is AFFIRMED.
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