IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 16-31034

BODY BY COOK, INCORPORATED; ROBERT COOK, 

 Plaintiffs - Appellants

v.

STATE FARM MUTUAL AUTOMOBILE INSURANCE; ALLSTATE 

INSURANCE COMPANY; LIBERTY MUTUAL INSURANCE COMPANY; 

GEICO GENERAL INSURANCE COMPANY; PROGRESSIVE SECURITY 

INSURANCE COMPANY; TRAVELERS INSURANCE COMPANY; 

RAMONA LATIOLAIS, individually and as corporate representative for 

State Farm, 

 Defendants - Appellees

Appeal from the United States District Court

for the Eastern District of Louisiana

Before HIGGINBOTHAM, GRAVES, and HIGGINSON, Circuit Judges.

STEPHEN A. HIGGINSON, Circuit Judge:

Plaintiffs-Appellants—Body by Cook, Inc. and its owner, Robert Cook—

filed a lawsuit in federal district court alleging various civil rights violations 

under 42 U.S.C. § 1981, § 1985, and Title VII, as well as several related statelaw claims. Defendants-Appellees are several national insurance companies—

State Farm Mutual Automobile Insurance, Allstate Insurance Co., Liberty 

Mutual Insurance Co., GEICO General Insurance Co., Progressive Security 

Insurance Co., and Travelers Insurance Co.—and a State Farm employee, 

United States Court of Appeals

Fifth Circuit

FILED

August 24, 2017

Lyle W. Cayce

Clerk

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2

Ramona Latiolais. After twice allowing Plaintiffs to amend their complaint,

the district court dismissed all of Plaintiffs’ claims. Plaintiffs appealed, and we 

AFFIRM in part and REVERSE in part.

I

Body by Cook is an automotive repair shop located in Slidell, Louisiana. 

Robert Cook, an African American, is the sole owner of Body by Cook. 

According to Plaintiffs, for several years Body by Cook sought to become a 

referral repair shop—commonly known as a “Direct Repair Shop”—through 

the “Direct Repair Programs” allegedly operated by Defendants. Plaintiffs 

allege that, despite their qualifications, Body by Cook and Robert Cook have 

“been refused entry into the [Direct Repair Programs,] and lesser qualified or 

similarly situated, non-minority owned body shops have been granted access.” 

Plaintiffs claim that Defendants discriminated against Body by Cook based on 

Robert Cook’s race and conspired with one another to refuse Body by Cook 

access to their Direct Repair Programs. Additionally, Plaintiffs allege that 

Defendants retaliated against them by “virtually shutting Plaintiffs out from 

any customer business of Defendants’ insureds.”

Plaintiffs sued Defendants in the Eastern District of Louisiana on June 

16, 2015. In their Second Amended Complaint (the “Complaint”), Plaintiffs

brought seven claims: (1) 42 U.S.C. § 1981 discrimination against all 

Defendants; (2) § 1985 conspiracy against all Defendants; (3) § 1981 retaliation 

against all Defendants; (4) § 1981 retaliation against State Farm and Latiolais; 

(5) Title VII discrimination against State Farm; (6) Title VII retaliation against 

State Farm; and (7) Louisiana state law claims for negligent training and 

supervision against all corporate Defendants. Defendants filed motions to 

dismiss the Complaint for failure to state a claim under Rule 12(b)(6) of the 

Federal Rules of Civil Procedure. The district court granted the motions as to 

the federal law claims and dismissed all the federal claims with prejudice. The 

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district court declined to exercise supplemental jurisdiction over the remaining

state law claims and dismissed them without prejudice. Plaintiffs filed a timely 

notice of appeal.

II

We review de novo a district court’s dismissal under Rule 12(b)(6). Doe 

ex rel. Magee v. Covington Cty. Sch. Dist. ex rel. Keys, 675 F.3d 849, 854 (5th 

Cir. 2012) (en banc). In doing so, we must accept all well-pleaded facts as true 

and view all facts in the light most favorable to the plaintiff. Id. We need not, 

however, accept the plaintiff’s legal conclusions as true. Ashcroft v. Iqbal, 556 

U.S. 662, 678 (2009). To survive a motion to dismiss, the plaintiff must plead 

“enough facts to state a claim to relief that is plausible on its face.” Bell Atl. 

Corp. v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial plausibility 

when the plaintiff pleads factual content that allows the court to draw the 

reasonable inference that the defendant is liable for the misconduct alleged.” 

Iqbal, 556 U.S. at 678. “Our task, then, is to determine whether the plaintiff 

has stated a legally cognizable claim that is plausible, not to evaluate the 

plaintiff’s likelihood of success.” Covington, 675 F.3d at 854 (internal quotation 

marks and citation omitted).

III

Plaintiffs’ primary argument on appeal is that the district court erred in 

dismissing Plaintiffs’ claims notwithstanding the court’s ruling that the 

Complaint satisfied Rule 8. Plaintiffs argue that Rule 12(b)(6) dismissal was 

inappropriate because the district court found that “[t]he minimum pleading 

requirements of Rule 8 [had] been satisfied in this case.” Plaintiffs contend that 

a complaint that satisfies Rule 8 necessarily also satisfies the Rule 12(b)(6) 

plausibility standard articulated in Twombly and Iqbal because those 

decisions interpreted Rule 8. This argument miscomprehends the district 

court’s analysis.

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In their motions to dismiss, Defendants contended that the Complaint 

violated Rule 8 because it was composed of generalized, group allegations. 

Defendants argued that Plaintiffs’ “group pleading” tactics failed to provide 

Defendants fair notice of the specific claims and allegations levied against each 

of them.

The district court rejected this argument, holding that the Complaint 

was sufficient to apprise each Defendant of the particular facts and claims 

alleged as to each Defendant. The district court noted that the Complaint 

contained factual subsections with allegations specific to each Defendant, as 

well as cause-of-action subsections that clearly identified the Defendant or 

Defendants against which that particular claim was asserted. However, the 

district court ultimately dismissed the Complaint under Rule 12(b)(6) because 

it found the pleading legally insufficient to state any of Plaintiffs’ federal 

claims.

We have previously explained that a complaint may simultaneously 

satisfy Rule 8’s technical requirements but fail to state a claim under Rule 

12(b)(6). See Bank of Abbeville & Tr. Co. v. Commonwealth Land Title Ins. Co., 

201 F. App’x 988, 990 (5th Cir. 2006) (unpublished). “[M]ere compliance with 

Rule 8 does not itself immunize the complaint against a motion to dismiss.” Id.

“Rule 8(a)(2) specifies the conditions of the formal adequacy of a pleading,” but 

“[i]t does not specify the conditions of its substantive adequacy, that is, its legal 

merit.” Id. (internal quotation marks and citation omitted). Thus, in Bank of 

Abbeville, we held that the complaint satisfied Rule 8’s formal requirements 

by pleading a short and plain statement of the claim, but that dismissal was 

nevertheless proper because the plaintiff “would not be entitled to relief under 

any set of facts or any possible theory that it could prove consistent with the 

complaint’s allegations.” Id.; see also Haskett v. T.S. Dudley Land Co., 648 F. 

App’x 492, 496 n.15 (5th Cir. 2016) (unpublished).

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The district court here concluded that the Complaint complied with Rule 

8 because it “at the very least provide[d] . . . Defendants minimally adequate 

notice of Plaintiffs’ claims in this matter and the bases therefor.” That

conclusion is consistent with the district court’s ultimate dismissal of Plaintiffs’ 

federal claims for failure to state a claim on which relief could be granted. See 

Bank of Abbeville, 201 F. App’x at 990. Plaintiffs’ argument to the contrary is 

without merit.

IV

Plaintiffs argue that the district court erred in dismissing their federal 

claims under Rule 12(b)(6). We address each claim in turn.

A. Section 1981 Discrimination Claims

Section 1981 provides that “[a]ll persons within the jurisdiction of the 

United States shall have the same right in every State and Territory to make 

and enforce contracts.” 42 U.S.C. § 1981(a). “Make and enforce contracts” is 

defined as “the making, performance, modification, and termination of 

contracts, and the enjoyment of all benefits, privileges, terms, and conditions 

of the contractual relationship.” § 1981(b). To establish a § 1981 claim for 

contractual discrimination, Plaintiffs must allege that (1) they are members of 

a racial minority; (2) Defendants intended to discriminate on the basis of race; 

and (3) the discrimination concerned one or more of the activities enumerated 

in the statute—here, making a contract. Bellows v. Amoco Oil Co., 118 F.3d 

268, 274 (5th Cir. 1997); Green v. State Bar of Tex., 27 F.3d 1083, 1086 (5th 

Cir. 1994). The analysis of discrimination claims under § 1981 is identical to 

the analysis of Title VII claims. Jones v. Robinson Prop. Grp. L.P., 427 F.3d 

987, 992 (5th Cir. 2005).

Here, Plaintiffs adequately plead the first element of a § 1981 claim by 

alleging that Body by Cook is a “100% African American-owned body shop.”

Whether Plaintiffs successfully plead the second and third elements are closer 

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questions. We first examine whether Plaintiffs adequately allege 

discriminatory intent.

Although “naked allegation[s]” of discriminatory intent are too 

conclusory to survive a motion to dismiss, see Albert v. Carovano, 851 F.2d 561, 

572 (2d Cir. 1988) (en banc), discriminatory motive may be—and commonly 

is—demonstrated by circumstantial evidence, Bellows, 118 F.3d at 274. An 

allegation that similarly situated non-minorities received better treatment 

“could create the necessary inference and set the predicate for establishing the 

section 1981 claim.” See Crosby v. Kilgore, 9 F.3d 104, 1993 WL 481800, at *1 

(5th Cir. 1993) (unpublished); cf. Lindsay v. Yates, 498 F.3d 434, 439–40 (6th 

Cir. 2007) (holding that plaintiffs-purchasers pleaded a § 1981 claim by 

alleging that (1) sellers advertised their house for sale; (2) plaintiffs signed a 

purchase agreement and made deposit; and (3) sellers terminated the contract 

three weeks after signing agreement and one day after agent learned buyers 

were black).1

 

1 Although not a pleading standard, this court has looked to the “evidentiary 

framework” set forth in McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), to determine 

whether a plaintiff pleads discriminatory intent. Haskett v. Cont’l Land Res., L.L.C., 668 F. 

App’x 133, 134 (5th Cir. 2016) (unpublished); cf. Swierkiewicz v. Sorema N.A., 534 U.S. 506, 

510 (2002) (holding that “[t]he prima facie case under McDonnell Douglas . . . is an 

evidentiary standard, not a pleading requirement”). Under McDonnell Douglas, Plaintiffs

must demonstrate four elements to establish a prima facie case of racial discrimination at 

the summary judgment phase: (1) membership in a protected class; (2) that they sought and 

were qualified to receive an available contract; (3) that their contract proposal was rejected 

or that they received a contract on unfavorable terms; and (4) similarly-situated individuals 

or entities not in the protected class received a contract. Jeffrey v. Columbia Med. Ctr. at 

Lancaster Subsidiary, LP, 48 F. App’x 103, 2002 WL 31016499, at *5 (5th Cir. 2002) 

(unpublished); see also Hall v. Cont’l Airlines, Inc., 252 F. App’x 650, 654 (5th Cir. 2007) 

(unpublished) (holding that the plaintiff failed to establish a prima facie case of racial 

discrimination under § 1981 at the summary judgment phase because “she presented no 

evidence that similarly situated individuals outside of her protected class were treated more 

favorably”). While Plaintiffs do not need to satisfy these four elements to successfully plead 

a § 1981 claim, see, e.g., Lindsay, 498 F.3d at 439–40, the McDonnell Douglas framework 

demonstrates the types of factual allegations sufficient to support a plausible inference of 

discriminatory intent.

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With respect to most Defendants, Plaintiffs make only generalized 

allegations regarding Defendants’ alleged disparate treatment of Body by Cook 

versus non-minority-owned shops. These allegations are not specific enough to 

plead discriminatory intent. They fail to identify which Defendant 

discriminated or specific instances when Body by Cook was refused a contract 

but a similarly situated non-minority owned body shop was given a contract. 

See Hall v. Cont’l Airlines, Inc., 252 F. App’x 650, 653–54 (5th Cir. 2007) 

(unpublished). Accordingly, as to most Defendants, Plaintiffs fail to plead 

discriminatory intent.

However, the Complaint contains more specific allegations regarding

State Farm’s discriminatory intent. Plaintiffs allege that a State Farm 

representative visited and inspected Body by Cook and found that it met all of 

State Farm’s qualifications for being a Direct Repair Shop, but that State Farm 

declined to allow Body by Cook to participate in the Direct Repair Program.2

Additionally, Plaintiffs allege that State Farm told Body by Cook that it was 

not admitting body shops into its Direct Repair Program but State Farm then 

admitted a non-minority-owned body shop with inferior equipment that did not 

meet State Farm’s “qualifications.” These allegations that similarly situated 

body shops were treated differently than Body by Cook and allowed into State 

Farm’s Direct Repair Service program make plausible the inference that the

difference in treatment was because of Body by Cook’s minority-owned status. 

See Haskett v. Cont’l Land Res., L.L.C., 668 F. App’x 133, 134 (5th Cir. 2016) 

(unpublished); Jeffrey v. Columbia Med. Ctr. at Lancaster Subsidiary, LP, 48 

F. App’x 103, 2002 WL 31016499, at *5 (5th Cir. 2002) (unpublished).3

 

2 Plaintiffs also allege that they sent Defendants their “brochure/application,” along 

with a cover letter that informed Defendants that Body by Cook is minority owned.

3 Plaintiffs also make several specific allegations regarding Progressive; however, 

these allegations fall short. Plaintiffs allege that Progressive repeatedly refused to certify 

Body by Cook as a Direct Repair Shop, that Progressive was aware that Body by Cook was 

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In addition to discriminatory intent, Plaintiffs must also plead that State 

Farm’s discrimination concerned one or more of the activities enumerated in 

the statute. Bellows, 118 F.3d at 274. “Any claim brought under § 1981 . . . 

must initially identify an impaired ‘contractual relationship,’ under which the 

plaintiff has rights,” but “[s]uch a contractual relationship need not already 

exist, because § 1981 protects the would-be contractor along with those who 

already have made contracts.” Domino’s Pizza, Inc. v. McDonald, 546 U.S. 470, 

476 (2006) (internal citation omitted). Thus, because Body by Cook does not 

allege an existing contract, it must plead facts that plausibly demonstrate that 

State Farm’s alleged discrimination concerned a prospective contract. See 

Grambling Univ. Nat’l Alumni Ass’n v. Bd. of Supervisors, 286 F. App’x 864, 

869–70 (5th Cir. 2008) (unpublished).

The Complaint does not state a plausible claim that Defendants refused 

to contract with the individual Plaintiff, Robert Cook. The gravamen of the 

Complaint is that Defendants refused to certify Body by Cook as a Direct 

Repair Shop and allow Body by Cook to enter their Direct Repair Programs. 

Cook, the sole shareholder of Body by Cook, is thus not the proper party to 

contract with any of the Defendants and cannot bring a § 1981 claim. See 

Bellows, 118 F.3d at 276 (concluding that the individual plaintiff had no 

individual § 1981 claim against the defendant, because his claim was merely 

derivative of the company plaintiff’s claim); Searcy v. Hous. Lighting & Power 

Co., 907 F.2d 562, 565 (5th Cir. 1990) (holding that the plaintiff could not bring 

 

minority-owned, and that during the same time period, Progressive sought out and approved 

non-minority-owned body shops to join the Direct Repair Program. Plaintiffs do not 

specifically plead, however, that Body by Cook was as qualified or more qualified than the 

non-minority body shops that Progressive sought out and approved for its Direct Repair 

Program. Plaintiffs have thus failed to plead discriminatory intent with respect to 

Progressive. See Haskett, 668 F. App’x at 134; Jeffrey, 2002 WL 31016499, at *5.

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his individual § 1981 claim because the alleged discrimination would only 

impair the contractual rights of the corporation and not the rights of the 

plaintiff, the company’s sole shareholder). 

With respect to Body by Cook, the Complaint alleges that it “had contact 

with State Farm to become a [Direct Repair Shop].”4 State Farm allegedly sent 

its Regional Director to inspect Body by Cook’s shop and found that it “met all 

of State Farm’s criteria, but [Body by Cook] was still denied.” Further, Body 

by Cook alleges that, after inquiring with Latiolais (a State Farm employee) 

about why another, unqualified body shop was in the Direct Repair Program,

Body by Cook “received a letter stating that Plaintiffs were declined as a 

[Direct Repair Shop].” 

These factual allegations are sufficient to plead the third element of Body 

by Cook’s § 1981 claim against State Farm. Although not finely detailed, these 

allegations create the plausible inference that Body by Cook attempted to enter 

a contractual relationship with State Farm to become a Direct Repair Shop

and receive referrals from State Farm’s customers. Cf. Grambling, 286 F. App’x 

at 870 (affirming district court’s dismissal of § 1981 contract discrimination 

claim when complaint alleged no facts about any sort of relationship, let alone 

a contractual relationship, between the plaintiff alumni association and the 

defendant university).5

 

4 As noted before, Plaintiffs also allege that “Body by Cook sent Defendants its 

brochure/application, along with a cover letter, asking to apply and become a part of their 

[Direct Repair Programs].” 

5 Citing Grambling, the district court identified three purported sub-requirements 

plaintiffs must satisfy to plead the third element of a § 1981 discrimination claim. According 

to the district court, a plaintiff must (1) identify the content of the contract at issue, (2) 

identify the particular contractual rights that were allegedly modified by the defendant’s 

actions, and (3) plead facts showing that the defendant’s actions were motivated by 

discriminatory intent. In Grambling, a university alumni association brought a § 1981 claim 

against the university’s supervisory boards, alleging that the boards’ various acts and 

omissions violated the association’s civil rights. Grambling, 286 F. App’x at 866. This court 

affirmed the district court’s dismissal of the association’s complaint, explaining that the 

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We conclude that the district court erred in dismissing Body by Cook’s 

§ 1981 contract claim against State Farm.6 We agree with the district court’s 

dismissal of Robert Cook’s § 1981 claim against State Farm and Plaintiffs’ 

§ 1981 claims against all other Defendants. 

B. Section 1985(3) Conspiracy Claims

Plaintiffs allege that Defendants “acted as co[-]conspirators and 

intentionally agreed and conspired with another body shop, Pike, to squeeze 

Plaintiffs out.” Additionally, Plaintiffs claim that Defendants “agreed with 

each other to discriminate on the basis of race against 100% African Americanowned body shops in connection with contracting, in violation of . . . 42 U.S.C. 

§ 1985(3), resulting in an unfair lack of representation by African Americanowned body shops in [Direct Repair Programs].”

Section 1985(3) prohibits conspiracies to deprive any person equal 

protection of the laws. 42 U.S.C. § 1985(3); Lockett v. New Orleans City, 607 

F.3d 992, 1002 (5th Cir. 2010). “To state a claim under § 1985(3), a plaintiff 

must allege facts demonstrating (1) a conspiracy; (2) for the purpose of 

depriving a person of the equal protection of the laws; and (3) an act in 

furtherance of the conspiracy; (4) which causes injury to a person or a 

deprivation of any right or privilege of a citizen of the United States.” Lockett, 

 

complaint “wholly fail[ed] to state the basic elements of a section § 1981 claim.” Id. at 870. 

The “closest” the association came to stating a viable § 1981 claim was its allegation that the 

boards “replac[ed] the [association] with the Grambling Black & Gold Foundation, Inc. in 

connection with the Bayou Classic.” Id. Provided with only the vague allegation that the 

association was “replaced,” this court concluded that the complaint failed to identify the 

content of the contract or any impaired contractual rights, and also failed to explain how the 

decision to “replace” the association was racially motivated. Id. We do not read Grambling to 

create concrete sub-requirements for pleading the third element of a § 1981 claim. Rather, 

the opinion merely identifies specific deficiencies in the association’s complaint. Id.

6 After dismissing all of Plaintiffs’ federal claims, the district court declined to exercise 

supplemental jurisdiction over Plaintiffs’ remaining state-law claims for negligent training 

or supervision. Because we reverse the district court’s dismissal of Body by Cook’s § 1981 

claim against State Farm, we also reverse the district court’s dismissal of the state law 

claims, and remand those claims for consideration on the merits.

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607 F.3d at 1002 (citing Hilliard v. Ferguson, 30 F.3d 649, 652–53 (5th Cir. 

1994)). Importantly, the plaintiff must allege facts that suggest an agreement 

among the alleged co-conspirators. See Green, 27 F.3d at 1089. 

Plaintiffs fail to plead facts suggesting an agreement between any of 

Defendants. The only alleged connection between Defendants is that 

“Defendants’ Motions are obviously the same work product with the same legal 

arguments and cases, [which] leads Plaintiffs to believe that . . . Defendants 

have conspired and continue to conspire against Plaintiffs.” These allegations 

are insufficient to demonstrate an agreement to deprive Plaintiffs of the equal 

protection of the laws. See id; see also Holdiness v. Stroud, 808 F.2d 417, 424 

(5th Cir. 1987) (explaining that “[m]ere conclusory allegations are insufficient” 

to state a claim under § 1985 and that plaintiffs “must plead the operative facts 

upon which their claim is based”). Accordingly, the district court did not err in 

dismissing Plaintiffs’ § 1985(3) conspiracy claims.

C. Section 1981 Retaliation Claims

Plaintiffs claim that Defendants retaliated against them for filing this 

lawsuit and for “complaining about not being allowed to become a [Direct 

Repair Shop] in their [Direct Repair Programs].” Plaintiffs allege that because 

they have had “significantly less work from customers who are also insureds 

of . . . Defendants,” and because Defendants’ briefing in this litigation has been 

similar, Plaintiffs “believe that . . . Defendants have conspired and continue to 

conspire . . . to retaliat[e] against Plaintiffs by virtually shutting Plaintiffs out 

from any customer business of Defendants insureds” and “believe . . .

Defendants are trying to put Plaintiffs out of business (retaliating).”

Plaintiffs also claim that State Farm and Ramona Latiolais retaliated 

against them after they complained to State Farm about racial discrimination 

and filed a complaint with the EEOC. Specifically, Plaintiffs allege that 

Latiolais, a team manager at State Farm, had unilateral control over certifying 

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a Direct Repair Shop and said that “she did not want Plaintiffs.” Plaintiffs 

allege that her refusal to certify the Plaintiffs was “causally connected to the 

Plaintiffs complaining about racial discrimination against them and the denial 

to the [Direct Repair Program].”

The elements of a § 1981 retaliation claim are (1) that the plaintiff 

engaged in activities protected by § 1981; (2) that an adverse action followed; 

and (3) a causal connection between the protected activities and the adverse 

action. See Foley v. Univ. of Hous. Sys., 355 F.3d 333, 339, 340 n.8 (5th Cir. 

2003). Even assuming that Plaintiffs plead the first two elements, Plaintiffs 

fail to allege facts sufficient to demonstrate a causal connection between their

alleged protected activities (complaining to Defendants, the EEOC action, and 

filing this lawsuit) and Defendants’ alleged adverse actions (refusals to 

contract with Plaintiffs). See Leal v. McHugh, 731 F.3d 405, 417 (5th Cir. 2013). 

To the contrary, the Complaint alleges that Defendants refused to contract 

with Plaintiffs both before and after Plaintiffs complained about racial 

discrimination, which suggests that Plaintiffs’ complaints and this lawsuit did 

not cause Defendants to deny Body by Cook entry into their Direct Service 

Programs. Plaintiffs’ conclusory beliefs that Defendants “are trying to put 

Plaintiffs out of business” and are “virtually shutting Plaintiffs out from any 

customer business of Defendants’ insureds” in retaliation for Plaintiffs filing a 

lawsuit and complaining about racial discrimination are inadequate to 

demonstrate a causal connection. See Eberle v. Gonzales, 240 F. App’x 622, 629 

(5th Cir. 2007) (unpublished) (holding that the plaintiff’s subjective belief that 

he was retaliated against, without more, was insufficient to establish a prima

facie case of retaliation). Likewise, Plaintiffs do not allege any facts suggesting 

that State Farm and Latiolais refused to approve Body by Cook as a Direct 

Repair Shop because Plaintiffs complained about racial discrimination and 

filed an EEOC complaint. Plaintiffs’ conclusory assertion that the denial was 

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causally connected to the Plaintiffs’ complaints is insufficient. See Leal, 731 

F.3d at 417; Eberle, 240 F. App’x at 629.

D. Title VII Discrimination and Retaliation Claims

Robert Cook also claims that State Farm discriminated and retaliated 

against him individually in violation of Title VII. Title VII of the Civil Rights 

Act of 1964, 42 U.S.C. § 2000e et seq., “provides remedies to employees for 

injuries related to discriminatory conduct and associated wrongs by 

employers.” Univ. of Tex. Sw. Med. Ctr. v. Nassar, 133 S. Ct. 2517, 2522 (2013).

To maintain a claim under Title VII, the plaintiff must demonstrate an 

“employment relationship” between the plaintiff and the defendant. See Deal 

v. State Farm Cty. Mut. Ins. Co., 5 F.3d 117, 118–19 (5th Cir. 1993). However, 

“Title VII’s prohibitions against discriminatory employment practices do not 

apply only to an existing employment relationship but also to prospective 

employment relationships that do not eventuate because of the discriminatory 

conduct—as where an applicant for employment is denied employment for a 

prohibited discriminatory reason.” Simmons v. Lyons, 746 F.2d 265, 270 (5th 

Cir. 1984).

Cook fails to allege facts sufficient to demonstrate the existence of a

prospective employment relationship. The Complaint alleges that State Farm 

refused to certify Body by Cook as a Direct Repair Shop and contract with Body 

by Cook as part of State Farm’s Direct Repair Program. Nowhere in the 

Complaint, however, are there any allegations that Cook sought to work as an 

employee of State Farm, or that individuals could become Direct Repair Shops 

or enter the Direct Repair Programs. Further, Cook fails to plead facts 

suggesting that he would enter an employment relationship with State Farm 

if State Farm had contracted with Body by Cook through its Direct Repair 

Program. Accordingly, the district court did not err in dismissing both of Cook’s 

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Title VII claims. See Travis v. City of Grand Prairie, 654 F. App’x 161, 166 (5th 

Cir. 2016) (unpublished).

V

In their opposition to Defendants’ motions to dismiss, Plaintiffs 

requested an opportunity to file a third amended complaint if the district court 

granted the motions. We review the district court’s denial of this request for 

abuse of discretion. See McKinney v. Irving Indep. Sch. Dist., 309 F.3d 308, 312

(5th Cir. 2002). Although Rule 15(a) requires the district court to grant leave 

to amend freely, “[l]eave to amend is in no way automatic.” Marucci Sports, 

L.L.C. v. Nat’l Collegiate Athletic Ass’n, 751 F.3d 368, 378 (5th Cir. 2014). “The 

district court is entrusted with the discretion to grant or deny a motion to 

amend and may consider a variety of factors including ‘undue delay, bad faith 

or dilatory motive on the part of the movant, repeated failures to cure 

deficiencies by amendments previously allowed, undue prejudice to the 

opposing party . . . , and futility of the amendment.’” Id. (quoting Jones, 427 

F.3d at 994). Where justification for a denial is “readily apparent,” a district 

court’s failure to explain its denial is not fatal to affirmance. Id. (quoting 

Mayeaux v. La. Health Serv. & Indem. Co., 376 F.3d 420, 426 (5th Cir. 2004)).

Here, the district court allowed Plaintiffs to amend their complaint 

twice. The district court did not abuse its discretion by refusing Plaintiffs 

another opportunity to plead their case and dismissing Plaintiffs’ federal 

claims with prejudice.

VI

For the foregoing reasons, we REVERSE the district court’s dismissal of 

Body by Cook’s § 1981 discrimination claim against State Farm, and we also 

REVERSE the district court’s dismissal of Plaintiffs’ state law claims. We

REMAND those claims to the district court for further proceedings consistent 

with this opinion. We AFFIRM the district court’s dismissal of all other claims.

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