Cai v. Huntsman Corporation

FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit
FOR THE TENTH CIRCUIT April 20, 2020
_________________________________
Christopher M. Wolpert
Clerk of Court
HUA CAI,
Plaintiff - Appellant,
v. No. 19-4116
(D.C. No. 2:18-CV-00968-TS)
HUNTSMAN CORPORATION, (D. Utah)
Defendant - Appellee.
_________________________________
ORDER AND JUDGMENT *
_________________________________
Before HOLMES, PHILLIPS, and CARSON, Circuit Judges.
_________________________________
Hua Cai, appearing pro se, appeals from the district court’s entry of judgment
on the pleadings in favor of Defendant Huntsman Corporation on his
breach-of-contract claim. Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.
*
After examining the briefs and appellate record, this panel has determined
unanimously to honor the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
submitted without oral argument. This order and judgment is not binding precedent,
except under the doctrines of law of the case, res judicata, and collateral estoppel. It
may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1
and 10th Cir. R. 32.1.
I. Background
Huntsman Corporation’s Chinese subsidiary, Huntsman Chemical Trading
(Shanghai) Ltd., employed Cai in Shanghai, China. But Huntsman Corporation was
not a party to Cai’s employment contract and it never employed Cai.
Huntsman Shanghai and Cai agreed in their contract that Cai’s continued
employment with the firm would be subject to satisfactory performance during a
six-month probationary period. Near the end of Cai’s probation, his supervisor at
Huntsman Shanghai, Frank Xing, fired him ostensibly for being incompetent. Cai
claims that Xing manufactured this pretense to cover-up his real reason for firing
Cai—namely, retaliation for Cai’s threat to report Xing’s abusive conduct and
falsification of data.
Cai sued Huntsman Shanghai in China, seeking reinstatement. His action
“went through labor arbitration court, trial court, appellate court, superior court, and
procuratorate.” R. at 7. Cai lost at every step. He also lodged several complaints
with Huntsman Corporation’s ethics and corporate compliance department. The
department investigated Cai’s case and allegedly found abnormalities related to the
“‘faking data’ issue” but confirmed that Xing correctly fired Cai. Id. at 6.
Cai then brought this suit against Huntsman Corporation. He asserts certain
Business Conduct Guidelines published by Huntsman Corporation constitute an
enforceable contract between himself and Huntsman Corporation. Cai further avers
that Huntsman Corporation breached this contract by failing to conduct an adequate
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investigation into his complaints and by failing to stop Huntsman Shanghai from
using unethical and dishonest tactics to defeat his suit.
The district court granted judgment to Huntsman Corporation on the pleadings
under Fed. R. Civ. P. 12(c), concluding that the Business Conduct Guidelines “do not
constitute a binding contract.” R. at 214. 1
II. Discussion
“A decision by the district court granting a defense motion for judgment on the
pleadings is reviewed de novo, using the same standard of review applicable to a
Rule 12(b)(6) motion.” Aspenwood Inv. Co. v. Martinez, 355 F.3d 1256, 1259
(10th Cir. 2004). “Thus, all the well-pleaded allegations of the complaint are
accepted as true and construed in the light most favorable to the plaintiff.” Id. “[T]o
survive judgment on the pleadings, [a plaintiff] must allege ‘a claim to relief that is
plausible on its face.’” Sanchez v. U.S. Dep’t of Energy, 870 F.3d 1185, 1199
(10th Cir. 2017) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “To
determine whether the claim to relief is ‘plausible on its face,’ we examine the
elements of the particular claim and review whether the plaintiff has pleaded ‘factual
content that allows the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.’” Id. (quoting Iqbal, 556 U.S. at 678). In ruling on
1
The district court also found that “[e]ven assuming the Business Conduct
Guidelines did constitute a contract between [Cai] and [Huntsman Corporation],
[Cai] has failed to show that [Huntsman Corporation] breached those Guidelines.”
R. at 214. Because we affirm the district court’s conclusion that the parties did not
form a binding contract, we do not address Cai’s arguments related to Huntsman
Corporation’s alleged breach of contract.
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the motion, the court “may consider documents referred to in the complaint if the
documents are central to the plaintiff’s claim and the parties do not dispute the
documents’ authenticity.” Jacobsen v. Deseret Book Co., 287 F.3d 936, 941 (10th
Cir. 2002).
We construe Cai’s pro se filings liberally but do not serve as his advocate. See
Garrett v. Selby Connor Maddux & Janer, 425 F.3d 836, 840 (10th Cir. 2005).
A. The Business Conduct Guidelines Do Not Constitute A Binding Contract
The parties do not contest the district court’s application of Utah law to the
question of whether they formed a contract. 2 Under Utah law, “formation of a
contract [generally] requires an offer, an acceptance, and consideration.” Cea v.
Hoffman, 276 P.3d 1178, 1185 (Utah Ct. App. 2012) (citing Golden Key Realty, Inc.
v. Mantas, 699 P.2d 730, 732 (Utah 1985)). “For an offer to be one that would create
a valid and binding contract, its terms must be definite and unambiguous.” DCM Inv.
Corp. v. Pinecrest Inv. Co., 34 P.3d 785, 789 (Utah 2001). And “[t]he obligations of
2
Cai alleges Huntsman Corporation maintains its principal place of business in
Utah and his complaint cited Utah law in support of his allegation that the “‘Business
Conduct Guidelines’ is a kind of contract between headquarter[s] and I.” R. at 6
(citing Uhrhahn Constr. & Design, Inc. v. Hopkins, 179 P.3d 808, 813 (Utah Ct. App.
2008)). The district court applied Utah law to reject this allegation. While Cai’s
opening brief claims generally that the district court applied the wrong law in
deciding the case and cites Illinois, Massachusetts, and Utah law in support of his
argument regarding contract formation, Cai does not explicitly argue that the district
court erred by applying Utah law. Cf. Kelley v. City of Albuquerque, 542 F.3d 802,
819 (10th Cir. 2008) (“[P]erfunctory” allegations of error that “fail[] to frame and
develop an issue” are insufficient “to invoke appellate review.” (internal quotation
marks omitted)). And in his reply brief, Cai relies on Utah law to support his claim
that Huntsman Corporation contracted directly with him.
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the parties must be ‘set forth with sufficient definiteness that [the contract] can be
performed.’” Cea, 276 P.3d at 1185 (second alteration in original) (quoting Ferris v.
Jennings, 595 P.2d 857, 859 (Utah 1979)).
Applying this law, the district court reasoned that “the terms of the Business
Conduct Guidelines are far from ‘definite and unambiguous.’ Rather, the Guidelines
speak in aspirational tones about the values of the company and the type of
workplace they seek to establish.” R. at 214. It further observed that “the Guidelines
do not provide the basis for determining the existence of a breach or for giving the
appropriate remedy.” Id. It therefore concluded that the Business Conduct
Guidelines “do not constitute a binding contract.” Id.
Cai argues that “Utah Law only requires offer, acceptance and consideration to
be definite and unambiguous.” Aplt. Reply Br. at 4. And he claims that “[t]he terms
of [the Business Conduct Guidelines] are clear and definite enough to form a
contract.” Id. at 1 (boldface omitted). But while he points to various statements in
the Guidelines outlining Huntsman Corporation’s policies on reporting alleged
violations, retaliation for such reporting, and discipline for violating the Guidelines,
Cai does not grapple with the district court’s reasoning that the Guidelines were too
nebulous to constitute a binding contract. Indeed, Cai does not point to any language
in the Guidelines that evinces an offer, acceptance, or exchange of consideration.
Cai also notes that an employee handbook can constitute a contract. But the
unpublished Utah case he cites holds that the type of contract created is an
employment contract and that the employee’s continued employment constitutes
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acceptance of the employer’s offer and supplies the consideration. See First Am.
Title Ins. v. Nw. Title Ins. Agency, No. 2:15-CV-00229-DN, 2016 WL 6902473, at
*22 (D. Utah Nov. 23, 2016) (“‘An employee manual may create a unilateral
contract.’ . . . ‘[T]he employee’s retention of employment constitutes acceptance of
the offer of a unilateral contract; by continuing to stay on the job, although free to
leave, the employment supplies the necessary consideration for the offer.’” (quoting
Reynolds v. Gentry Fin. Corp. & Royal Mgmt., 368 P.3d 96, 100 (Utah Ct. App.
2016)). Cai concedes the Business Conduct Guidelines do not form an employment
contract and does not claim Huntsman Corporation ever employed him. We therefore
conclude the employee handbook cases have no relevance here.
We affirm the district court’s conclusion that the Business Conduct Guidelines
do not constitute a binding contract between Cai and Huntsman Corporation.
B. The District Court Did Not Err By Considering Huntsman Corporation’s
Argument
Cai also asserts that the district court erred by considering Huntsman
Corporation’s argument that the Business Conduct Guidelines do not constitute a
binding contract because Huntsman first asserted this argument in its reply in support
of its motion for judgment on the pleadings. Cf. D. Utah Civ. R. 7-1(b)(2)(A)
(“Reply memoranda . . . must be limited to rebuttal of matters raised in the
memorandum in opposition.”).
Huntsman Corporation argued in its motion for judgment on the pleadings that
it “is not—and has never been—a party to any contract with [Cai].” R. at 35. In
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response, Cai clarified his position that “the contract [Huntsman Corporation]
breached is . . . named ‘Business Conduct Guidelines[,]’ . . . made between [Cai]
and . . . Huntsman Corporation.” Id. at 90. Huntsman Corporation then argued in
reply that “the Business Conduct Guidelines alone are nowhere near sufficiently
definite to form an offer that would constitute a binding contract.” Id. at 155.
Huntsman Corporation’s reply directly rebutted the contention from Cai’s opposition
brief that the Business Conduct Guidelines constituted a binding contract between
Huntsman Corporation and himself. The district court did not err by considering this
rebuttal argument.
C. Cai’s Remaining Arguments Lack Merit
Cai contends that Huntsman Corporation mischaracterized his complaint in its
filings with the district court by construing his claims as breach-of-contract claims
against Huntsman Shanghai. He then argues that the district court accepted this
alleged ruse and failed to consider his “actual allegation . . . that [Huntsman
Corporation] breached [the Business Conduct Guidelines].” Aplt. Opening Br. at 7.
We reject this frivolous argument since the district court squarely addressed Cai’s
assertion that Huntsman Corporation formed a contract with him and then breached
that contract.
Cai also avers the district court erred by stating that his employment contract
with Huntsman Shanghai “incorporated Defendant Huntsman Corporation’s Business
Conduct Guidelines.” R. at 211. The district court’s view tracks closely with Cai’s
own allegation in the complaint that “by signing the employment contract [with
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Huntsman Shanghai] plaintiff acknowledged [he would] fully abide by the corporate
‘Business Conduct Guidelines.’” Id. at 5. In any event, the district court’s
disposition did not relate to its assessment of whether Cai’s employment contract
incorporated the Business Conduct Guidelines. We therefore will not review this
allegation of error. See, e.g., Orr v. City of Albuquerque, 417 F.3d 1144, 1154
(10th Cir. 2005) (observing that the court “will not address [an] issue [that] has no
bearing on the ultimate outcome of [the] case”).
III. Conclusion
We affirm the district court’s dismissal of Cai’s breach-of-contract claim
against Huntsman Corporation.
Entered for the Court
Gregory A. Phillips
Circuit Judge
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