Guerra v. Celanes Corp

Opinion

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

Nos. 95-40874, 95-40889, 95-40910, 96-40333, 96-40451, 97-40525, 97-40527

Summary Calendar

OSCAR GUERRA,

Plaintiff-Appellant,

VERSUS

CELANESE CORP.; CELANESE CHEMICAL CO; ARTHUR BROTHERS INC.,

Defendants-Appellees.

ISRAEL TREVINO,

CELANESE CORPORATION; CELANESE CHEMICAL; ARTHUR BROTHERS INC., Defendants-Appellees.

EUGENIO MIRELES; BARTOLO MENDIOLA; ISRAEL TREVINO; FRANCISCO GONZALES,

Plaintiffs-Appellants,

ARTHUR BROTHERS INC.,

Defendant-Appellee. EUGENIO MIRELES; BARTOLO MENDIOLA; ISRAEL TREVINO; FRANCISCO GONZALES,

Defendant-Appellee.

CELANESE CORPORATION; CELANESE CHEMICAL CO; ARTHUR BROTHERS INC.,

CELANESE CORPORATION; CELANESE CHEMICAL; ARTHUR BROTHERS INC.,

2 Appeals from the United States District Court for the Southern District of Texas (95-CR-274-1) January 9, 1998 Before JONES, DeMOSS and PARKER, Circuit Judges.

PER CURIAM:*

The Petitions for Rehearing filed by Oscar Guerra and Israel

Trevino are GRANTED. The previous opinion filed in this case is

withdrawn and the following opinion is substituted therefore. The Appellants, Oscar Guerra, Israel Trevino, Eulogio Mireles,

Bartolo Mendiola, and Francisco Gonzales, filed suit against the

Appellees for employment discrimination under Title VII (42 U.S.C.

§ 2000e-5(f)(3)). Following settlement of their dispute, the

Appellants sought an award of attorneys' fees pursuant to 42 U.S.C.

§ 1988. The district court denied the Appellants’ motion for

attorney fees. We affirm in part, and reverse and remand in part.

FACTS AND PROCEEDINGS BELOW

Five Mexican-American plaintiffs brought three civil rights

actions to complain of discriminatory employment practices at a Celanese Corporation (“Celanese”) chemical plant in Bishop, Texas.

Appellants were employed by Arthur Brothers, Inc. (“ABI”), a

contracting firm that provided maintenance and operating employees

at Celanese. Appellants alleged that Celanese and ABI denied them

* Pursuant to 5th Cir. Rule 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5th Cir. Rule 47.5.4.

3 and other Mexican-American workers an equal opportunity to compete

with Anglos for the preferred jobs at Celanese, leaving Mexican

Americans behind at ABI in disproportionate numbers while the

contractor’s Anglo employees were being promoted to steady

employment at Celanese.

1. Mireles

In 1975 Mireles, Mendiola, Trevino and Gonzalez (referred to

collectively as “Mireles”) filed charges of employment

discrimination with the Equal Employment Opportunity Commission

(“EEOC”). Mireles claimed that ABI had discriminated against him

on the basis of his Mexican national origin. After receiving his

right to sue letter, he filed a class action complaint on October

28, 1976 against ABI. During the course of discovery, he obtained

information that indicated substantial involvement by Celanese

managers and supervisors in decisions affecting employment with ABI

and with opportunities to compete for job openings at Celanese.

Mireles moved to join Celanese as a defendant. The district court

never ruled on that motion. Mireles later moved to file an amended

complaint naming Celanese as a defendant. That motion was granted,

but no amended complaint was ever filed. However, Celanese

subsequently filed pleadings in the Mireles case referring to

itself as “defendant Celanese” and seeking various forms of relief

from the court. Celanese eventually entered into agreements,

pursuant to which it paid the Mireles plaintiffs $24,000 in return

for release from liability in the Mireles litigation. The release

expressly excluded any claims for attorneys’ fees and costs of the

4 litigation.

The district court denied Mireles’s motion for attorney fees

based on a finding that Celanese was not a party to that case.

2. Trevino

Israel Trevino, while remaining a party to the Mireles

litigation, filed a new charge with the EEOC in 1979, alleging

Celanese and ABI were jointly responsible as employers for the

discriminatory practices at the Bishop plant. Trevino then filed

a Title VII action against both Celanese and ABI on April 30, 1980.

The district court denied class certification, granted summary

judgment against Trevino and awarded $24,541 in fees to the

defendants on the ground that the case was frivolous. The fee

award was entered against Trevino and his counsel, Texas Rural

Legal Aid, Inc. (“TRLA”). In 1981, TRLA withdrew as attorney for

Trevino because he had become ineligible for their services under

the provisions of 45 C.F.R. § 1611.9 and private counsel was

substituted. On appeal, this court vacated the orders and remanded

the case with instructions to consider the joint-employer theory

argued by Trevino. Trevino v. Celanese Corp., 701 F.2d 397 (5th

Cir. 1983). In April 1992, ABI settled all claims with all

plaintiffs in the three related suits, including attorneys’ fees.

In February 1993, the district court held a hearing on the

1983 remand, but entered no order. In October 1993, Celanese

settled with Trevino and the district court dismissed his case in

December 1993. The agreement expressly waived any claim Trevino

had to an attorney fee award against Celanese. TRLA takes the

5 position that they remained a party to the Trevino case after

private counsel substituted in their stead due to the subsequently

reversed attorney fee award against them, and that the dismissal

was not final because they did not receive notice of Trevino and

Celanese settlement.

The district court denied attorney fees in Trevino, finding

that it did not have jurisdiction to reopen the case which had been

closed more than two years earlier.

3. Guerra

Guerra filed his EEOC charges in February 1978 and his Title

VII and § 1981 actions in 1980 against both ABI and Celanese. The

Guerra case otherwise shares its procedural history with Mireles.

Guerra’s ABI claims were settled in 1992 and his Celanese claims

were settled in 1994 for $12,500.

The district court denied attorney fees, finding that Guerra

was not a prevailing party.

DISCUSSION

1. Standard of review.

On appeal, this Court reviews the district court's ruling on

a request for attorneys' fees authorized by statute for abuse of

discretion, and the supporting factual findings are reviewed for

clear error. Cooper v. Pentecost, 77 F.3d 829, 831 (5th Cir.

1996), quoting, Watkins v. Fordice, 7 F.3d 453 (5th Cir. 1993). We

review conclusions of law underlying a denial of attorneys' fees de

6 novo. Texas Food Indus. Assoc. v. United States Dep't of Agric.,

81 F.3d 578, 580 (5th Cir. 1996).

2. Guerra’s prevailing party status.

We turn first to the district court's ruling that Appellant

Guerra was not a prevailing party. We hold the district court

erred. The United States Supreme Court in Farrar v. Hobby, 506

U.S. 103, 113 S. Ct. 566, 121 L. Ed. 2d 494 (1992), clearly set

forth the requirement for a plaintiff to be a "prevailing party"

under 42 U.S.C. § 1988. The Farrar Court stated that "to qualify

as a prevailing party, a civil rights plaintiff must obtain at

least some relief on the merits of his claim. The plaintiff must

obtain an enforceable judgment against the defendant from whom fees

are sought, or comparable relief through a consent decree or

settlement." Id. 506 U.S. at 111, 113 S. Ct. at 573 (citations

omitted)(emphasis added). Further, the Court stated that "[a]

judgment for damages in any amount, whether compensatory or

nominal, modifies the defendant's behavior for the plaintiff's

benefit by forcing the defendant to pay an amount of money he

otherwise would not pay" and, therefore, such a plaintiff is a

"prevailing party" for purposes of attorneys' fees under 42 U.S.C.

§ 1988. Id. 506 U.S. at 113, 113 S. Ct. at 574.

In the instant case, Celanese paid Guerra $12,500 in

settlement of Guerra’s claim. According to the dictates of Farrar,

the judgment of the district court in finding that Guerra was not

a "prevailing party" must be reversed. On remand, the district

court should determine a reasonable attorney for this case, by

7 e.g., calculating the lodestar (reasonable number of hours times

reasonable hourly rate) then applying the factors set out in

Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir.

1974), and adjusting the lodestar upward or downward if

appropriate. See Riley v. Jackson, Mississippi, 99 F.3d 757, 760

(5th Cir. 1996).1

3. District court jurisdiction to award fees in Trevino.

The district court held that it had no authority to award

attorney fees in Trevino because the order of dismissal was entered

more than two years prior to TRLA’s motion for attorney fees and

there was no basis alleged by TRLA for the district court to

exercise jurisdiction over Trevino in 1996. We agree. Appellants

advance no arguable basis for district court jurisdiction over the

Trevino case in 1996. Seeing none ourselves, we affirm.

4. Was Celanese subject to the district court’s jurisdiction in Mireles?

The district court declined to award attorney fees in Mireles

because it found that Celanese was not a party to that case.

Celanese contends that Mireles’s complaint did not state a cause of

action against Celanese and that such complaint was never properly

served on Celanese. However, Celanese waived these defenses. Rule

12, FED.R.CIV.P., provides:

A defense of lack of jurisdiction over the person,

1 A “reasonable” fee for a prevailing party under the circumstances of a particular case may be a low fee or no fee, Farrar, 506 U.S. at 115, 113 S.Ct. at 575, in which case the district court need not recite each of the Johnson factors or even do the lodestar calculations. Id. We express no opinion as to what a reasonable fee might be in these cases.

8 improper venue, insufficiency of process or insufficiency of service of process is waived . . . if it is neither made by motion under this rule nor included in a responsive pleading or an amendment thereof permitted by Rule 15(a) to be made as a matter of course.

The record in Mireles reveals no motion pursuant to Rule 12 or

objection in a responsive pleading after Mireles attempted to join

Celanese as a party to the case. If fact, Celanese filed pleadings

in the case referring to itself as a defendant and entered a

settlement agreement with Mireles in satisfaction of Mireles’s

claims asserted in the case, which expressly reserved the attorney

fee issue. We therefore find that Celanese waived the argument

that it was not a party to the suit. Further, it is clear under

Farrar that Mireles, like Guerra, met the criteria for establishing

that he was a prevailing party in the suit. Farrar, 506 U.S. at

111, 113 S. Ct. at 573. We therefore reverse the denial of

attorney fees in this case as well and remand for a determination

of the appropriate amount of fees.

CONCLUSION

For the foregoing reasons, we affirm the district court’s

denial of attorney fees in Trevino, 95-40889 and 97-40527, and

reverse the denial of attorney fees in Guerra, 95-40874, 96-40451

and 97-40525 and Mireles, 95-40910 and 96-40333. We REMAND Guerra

and Mireles for the district court to determine a reasonable

amount of attorney fees.