Neeraj Chopra v. U.S. Professionals, L.L.C.

IN THE COURT OF APPEALS OF TENNESSEE
AT JACKSON
Assigned On Brief October 28, 2004
NEERAJ CHOPRA v. U.S. PROFESSIONALS, LLC, ET AL.
Direct Appeal from the Circuit Court for Shelby County
No. CT-004949-00 Karen R. Williams, Judge
No. W2004-01189-COA-R3-CV - Filed February 2, 2005
Defendants U. S. Professionals, LLC and Satya B. Shaw and Rajashree S. Shaw, individually, appeal
the judgment of the trial court awarding Plaintiff Neeraj Chopra compensatory and punitive damages
for breach of contract and intentional misrepresentation. We affirm.
Tenn. R. App. P. Appeal as of Right; Judgment of the Circuit Court Affirmed; and
Remanded
DAVID R. FARMER , J., delivered the opinion of the court, in which W. FRANK CRAWFORD , P.J., W.S.,
and HOLLY M. KIRBY , J., joined.
Harold D. Mangrum, Memphis, Tennessee, for the appellants, U.S. Professionals, LLC, Satya B.
Shaw and Rajashree S. Shaw.
John S. Richbourg, Memphis, Tennessee, for the appellee, Neeraj Chopra.
OPINION
In August 2000, Neeraj Chopra (Mr. Chopra) filed a complaint against U.S. Professionals,
LLC (“USP”) and Satya B. Shaw (Mr. Shaw), individually, alleging breach of contract and
intentional misrepresentation and seeking compensatory and punitive damages. Mr. Chopra
amended his complaint in December 2000, adding Rajashree S. Shaw (Ms. Shaw) as a Defendant
(Mr. and Ms. Shaw, collectively, will be referred to as “the Shaws”). In his amended complaint, Mr.
Chopra asserted that, sometime prior to November 1998, Mr. Shaw, while in India, hired Mr. Chopra
as a computer analyst on behalf of USP. He asserted that Mr. Shaw promised him a salary of
$42,000 and stated he would obtain the necessary visa required for professionals to enter the United
States to perform professional services on a temporary basis. Mr. Chopra further alleged that, in
reliance on Mr. Shaw’s promise, he rejected an offer of a position in the Indian army and accepted
Mr. Shaw’s offer.
In November 1998, Mr. Chopra traveled to the United Sates from India on an H-1B visa1
issued by the Department of Immigration and Naturalization Services (“INS”) upon application of
Defendants Ms. Shaw and USP. However, notwithstanding their representations to the INS on their
application for Mr. Chopra’s H-1B visa, USP and the Shaws (collectively, “Defendants” or
“Appellants”) did not employ Mr. Chopra as a computer analyst at a salary of $42,000 per year. In
his amended complaint, Mr. Chopra alleged that Mr. Shaw informed him that he would only employ
Mr. Chopra as a cashier at less than minimum wage. Mr. Chopra alleged that he was paid a total of
$600 in living expenses by Mr. Shaw and USP, and $1,000 by Mr. Shaw for working as a cashier
in gas stations owned by Mr. Shaw. Mr. Chopra further submitted that, by law, USP or the Shaws
were required to pay his travel expenses back to India in the event his employment was terminated
for any reason.
Mr. Chopra prayed for compensatory damages of $109,639.75 in travel expenses and salary.
He further asserted that USP is the alter ego of the Shaws, and that the Shaws were personally liable
for the debts of USP. Mr. Chopra additionally prayed for punitive damages of $10,000,000.
The matter was tried before a jury in January 2004. The jury awarded a verdict in favor of
Mr. Chopra and against USP and the Shaws individually. The jury awarded a verdict jointly and
severally against USP, Mr. Shaw, and Ms. Shaw in the amount of $126,900 as compensatory
damages for breach of contract and intentional misrepresentation. It further awarded a verdict for
punitive damages against USP in the amount of $30,000, in the amount of $30,000 against Mr.
Shaw, and in the amount of $30,000 against Ms. Shaw. The trial court denied Defendants’ motion
for a new trial and Defendants filed a timely notice of appeal to this Court.
Issues Presented
Appellants raise the following issues for our review:
(1) Whether the trial court erred in denying Appellants’ motion to direct a verdict
in Appellants’ favor at the close of Appellee’s proof;
(2) Whether the trial court erred in denying Appellants’ motion to direct a verdict
in Appellants’[,] Satya Shaw and Rajashree Shaw, favor at the close of all
the evidence.
1
H-1B is a nonimmigrant category set aside for foreign workers in “specialty occupations,” particularly high-
skilled workers. A foreign worker may travel to the United States under an H-1B visa to temporarily fill a position in
a speciality occupation (although the position may be a permanent position). The foreign worker must have the
qualifications necessary to undertake this occupation. Additionally, the sponsoring employer must file a labor condition
application with the Department of Labor and classification in the H-1B category is possible only if the Secretary of
Labor certifies to the Attorney General that the labor condition application has been filed. Austin R. Fragomen, Jr. and
Steven C. Bell, H-1B Handbook §§ 1:1, 1:8 (W est Group 2002); 8 U.S.C. § 1101 et seq.
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Standard of Review
Appellate review of a trial court's decision to grant a directed verdict is well-settled. A
directed verdict is appropriate when the evidence is susceptible to only one conclusion. Nee v. Big
Creek Partners, 106 S.W.3d 650, 653 (Tenn. Ct. App. 2002)(citing Alexander v. Armentrout, 24
S.W.3d 267, 271 (Tenn.2000)). This conclusion, however, cannot be based on speculation,
conjecture, or guesswork. Id. If reasonable persons could draw conflicting conclusions on issues
of fact, the matter should go to the jury. Id. When deciding whether a trial court should have
granted a directed verdict, we must take the strongest legitimate view of the evidence in favor of the
opponent of the motion. Id. Further, we must allow all reasonable inferences in favor of the
opponent of the motion and disregard all evidence contrary to the opponent's position. Id.
When a trial court’s decision not to grant a directed verdict is predicated on a determination
of a question of law, the determination of the question of law is subject to later review by the
appellate court where the issue has been preserved for review in accordance with the Rules of Civil
Procedure. See Mercer v. Vanderbilt University, Inc., 134 S.W.3d 121, 130-31 (Tenn. 2004). Our
review of the trial court’s determination on a question of law is subject to de novo review with no
presumption of correctness. Bowden v. Ward, 27 S.W.3d 913, 916 (Tenn. 2000).
On appeal from a jury trial, we will not set aside the jury’s findings of fact unless there is
no material evidence to support the verdict. Childress v. Union Realty Co., 97 S.W.3d 573, 576
(Tenn. Ct. App. 2002); Tenn. R. App. P. 13(d). Upon review, this Court will not re-weigh the
evidence, but will take the strongest view possible of the evidence in favor of the prevailing party,
and discard evidence to the contrary. Id. We will allow all reasonable inferences to uphold the jury's
verdict, setting it aside only if there is no material evidence to support it. Id.
Analysis
Appellants first assert that the trial court erred in not granting them a directed verdict because
Mr. Chopra lacked standing to bring this cause of action. They contend that Mr. Chopra was an
illegal alien as of April 2000 and that, under Hoffman Plastic Compounds, Inc. v. National Labor
Relations Board, 535 U.S. 137, 122 S. Ct. 1275 (2002), an illegal alien has “no standing in any court
in the United States.”
As an initial matter, we note that Mr. Chopra entered the United States legally under an H-1B
visa obtained by Appellants. Mr. Chopra’s later illegal alien status resulted from Appellants’ failure
to fulfill their obligations under 8 U.S.C. §1182 to employ Mr. Chopra and pay him at the prevailing
rate or, under 8 U.S.C. §1184(c)(5)(A), to pay for the reasonable costs of his return to India upon
dismissal before the end of the period of authorized admission. We therefore find Appellants’
reliance on Mr. Chopra’s status as an illegal alien somewhat disingenuous. Be that as it may, we
disagree with Appellants’ contention that Hoffman stands for the proposition that Mr. Chopra had
“no standing in any court in the United States” to bring this lawsuit.
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In Hoffman, the United States Supreme Court reversed the decision of the National Labor
Relations Board (“the Board”) to award backpay to an undocumented alien who had never been
legally authorized to work in the United States. Hoffman, 535 U.S. at 140. The defendant in
Hoffman, Jose Castro (Mr. Castro), was a national of Mexico who entered that United States illegally
and secured employment with Hoffman Plastic Compounds, Inc. (“Hoffman Plastics”) in May 1988
by tendering the birth certificate of a friend born in Texas. Id. at 140-41. He also fraudulently used
this birth certificate to obtain a California driver’s license, a social security card, and subsequent
employment. Id. at 141. In December 1989, Hoffman Plastics unlawfully terminated four
employees, including Mr. Castro, “in order to rid itself of known union supporters.” Id. at 140.
Despite the fact that the terminations were in violation of § 8(a)(3) of the National Labor Relations
Act (NLRA), the Supreme Court held that to permit an undocumented alien to recover backpay
under the NLRA is foreclosed by federal immigration policy as expressed in the Immigration Reform
and Control Act of 1986 (IRCA). Id.
Hoffman is inapplicable to the case at bar. First, Hoffman cannot be read to stand for the
proposition that an illegal alien has no standing in any court in the United States for any reason.
Even the broadest reading of Hoffman could not suggest such a conclusion. See, e.g., Singh v. Jutla
& C.D. & R’s Oil, Inc., 214 F. Supp. 2d 1056 (N.D. Cal. 2002)(holding: undocumented alien not
precluded from bringing cause of action under Fair Labor Standards Act); Tyson Foods, Inc. v.
Guzman, 116 S.W.3d 233 (Tex. Ct. App. 2003)(holding: lack of immigration work authorization
does not preclude recovery for lost earning capacity under state law). The Hoffman court did not
hold that the plaintiff in Hoffman had no standing. Rather, it determined that the remedy of backpay
was not available in a lawsuit brought under the NLRA to an undocumented alien employee whose
employment was illegally obtained in violation of the IRCA. The Hoffman court did not foreclose
“‘traditional remedies’ sufficient to effectuate national labor policy regardless of whether the ‘spur
and catalyst’ of backpay accompanies them.” Hoffman, 535 U.S. at 152 (quoting Sure-Tan, Inc. v.
NLRB, 467 U.S. 883, 904 (1984)).
Second, Hoffman was a case requiring a delicate balance between United States immigration
law and labor law. The Hoffman court determined that permitting recovery under the NLRA for pay
which would have been obtained illegally but for an employer’s violation of the NLRA contravened
the immigration policies set-forth by Congress in the IRCA. The Hoffman court observed:
It (the IRCA) thus prohibits aliens from using or attempting to use "any forged,
counterfeit, altered, or falsely made document" or "any document lawfully issued to
or with respect to a person other than the possessor" for purposes of obtaining
employment in the United States. §§ 1324c(a)(1)-(3). Aliens who use or attempt to
use such documents are subject to fines and criminal prosecution. 18 U.S.C. §
1546(b). There is no dispute that Castro's use of false documents to obtain
employment with Hoffman violated these provisions.
Under the IRCA regime, it is impossible for an undocumented alien to obtain
employment in the United States without some party directly contravening explicit
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congressional policies. Either the undocumented alien tenders fraudulent
identification, which subverts the cornerstone of IRCA's enforcement mechanism,
or the employer knowingly hires the undocumented alien in direct contradiction of
its IRCA obligations. The Board asks that we overlook this fact and allow it to
award backpay to an illegal alien for years of work not performed, for wages that
could not lawfully have been earned, and for a job obtained in the first instance by
a criminal fraud.
Id. at 148-49. The Hoffman court held :
We find, however, that awarding backpay to illegal aliens runs counter to policies
underlying IRCA, policies the Board has no authority to enforce or administer.
Therefore, as we have consistently held in like circumstances, the award lies beyond
the bounds of the Board's remedial discretion.
....
What matters here . . . is that Congress has expressly made it criminally punishable
for an alien to obtain employment with false documents. There is no reason to think
that Congress nonetheless intended to permit backpay where but for an employer's
unfair labor practices, an alien-employee would have remained in the United States
illegally, and continued to work illegally, all the while successfully evading
apprehension by immigration authorities. Far from "accommodating" IRCA, the
Board's position, recognizing employer misconduct but discounting the misconduct
of illegal alien employees, subverts it.
Id. at 149-50.
Unlike Hoffman, the case now before this Court is not one in which the plaintiff/employee
seeks to subvert the IRCA. Nor is it a case brought under the NRLA. Rather, this is an action for
breach of contract and intentional misrepresentation brought by a foreign national who entered the
United States legally, was legally entitled to work in the United States pursuant to an H-1B visa, and
who, but for Appellants’ actions, would have remained legally entitled to employment during the
period for which he sought damages. Indeed, to deny Mr. Chopra standing would contravene United
States immigration policy by permitting, if not encouraging, unscrupulous employers to fraudulently
obtain H-1B visas to employ foreign nationals at less than minimum wage, as was the case here.
Moreover, Appellants do not argue that this lawsuit is somehow preempted by the holding in
Hoffman, and we find nothing in Tennessee law which would bar Mr. Chopra’s action for breach of
contract and intentional misrepresentation.
Appellants next assert the trial court erred by failing to grant a directed verdict holding that
Mr. Shaw and Ms. Shaw were not individually liable for the obligations of USP. The determination
of whether the corporate veil should be pierced and individuals held liable for obligations of the
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corporate entity depends on the unique circumstances of each case and is within the province of the
finder of fact. Mike v. Po Group, Inc., 937 S.W.2d 790, 795 (Tenn. 1996). The question of whether
“a corporation is a mere instrumentality of an individual or a parent corporation is ordinarily a
question of fact for the jury.” Id. (quoting Electric Power Bd. of Chattanooga v. St. Joseph Valley
Structural Steel Corp., 691 S.W.2d 522, 526 (Tenn.1985)). Taking the strongest view of the
evidence in favor of the non-movant, Mr. Chopra, and allowing all reasonable inferences in his
favor, we cannot say the evidence in this case led to only one reasonable conclusion. Accordingly,
we affirm the trial court’s determination to deny Appellants’ motion for directed verdict. Further,
contrary to Appellants’ assertion otherwise, upon review of the evidence we find material evidence
to support the verdict of the jury.
Holding
In light of the foregoing, we affirm the judgment of the trial court. Costs of this appeal are
taxed to the Appellants, U. S. Professionals, LLC, and Satya B. Shaw and Rajashree S. Shaw,
individually, and to their sureties, for which execution may issue if necessary.
___________________________________
DAVID R. FARMER, JUDGE
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