Court Opinion

ID: 4313121
Source: CourtListenerOpinion
Date Created: 2018-09-18 12:22:09.703785+00
Date Added: 2024-06-11T14:44:44.588218
License: Public Domain

AFFIRM; and Opinion Filed September 17, 2018.

                                               In The
                                Court of Appeals
                         Fifth District of Texas at Dallas
                                       No. 05-17-00760-CV

                              MICHAEL WILLIAMS, Appellant
                                         V.
                              CALIBER HOME LOANS, Appellee

                       On Appeal from the 298th Judicial District Court
                                    Dallas County, Texas
                            Trial Court Cause No. DC-17-03199

                              MEMORANDUM OPINION
                           Before Justices Lang, Fillmore, and Schenck
                                   Opinion by Justice Fillmore
       Michael Williams sued his former employer, Caliber Home Loans, in the United States

District Court for the Northern District of Texas (the federal district court), asserting statutory

claims based on discrimination and a hostile work environment that he allegedly experienced while

employed at Caliber and common law claims based on Caliber’s employees disclosing information

about him to the Irving Police Department (the IPD) and the Frisco Police Department (the FPD).

After the federal district court dismissed the case with prejudice, Williams filed this suit asserting

common law claims against Caliber based on the IPD issuing a “Be on the Lookout” (BOLO)

using information provided by Caliber’s employees. Caliber moved for summary judgment on

grounds Williams’s claims were barred by res judicata, the statute of limitations, and quasi-judicial

immunity.
             In three issues, Williams asserts the trial court erred by granting summary judgment in

favor of Caliber because his claims were not barred by res judicata and the trial court erred by not

applying the doctrines of “continuing violations” and “post-termination retaliation.”1 Although

not set out as a separate issue, Williams also argues in his brief that his claims were not barred by

quasi-judicial immunity. We conclude the trial court properly determined Williams’s claims were

barred by res judicata and affirm the trial court’s judgment.

                                                                 Background

             Williams began working for Caliber as Lead Business Intelligence Engineer in August

2013.         On December 21, 2013, Williams contacted the IPD, alleging he had experienced

difficulties with a “hate group” of employees at Caliber and seeking “information on defining and

possibly reporting on-going terroristic threats.” The IPD dispatcher contacted Caliber and reported

Williams’s call. According to Caliber, it conducted an internal investigation and found no

evidence of the “hate group” or to support Williams’s allegations, but found evidence Williams

had behaved inappropriately in the workplace. Caliber terminated Williams’s employment on

March 4, 2014.

             Williams sued Caliber in the federal district court on July 17, 2015.2 On April 12, 2016,

the federal district court granted Williams’s motion to amend his complaint. In his first amended

complaint, Williams asserted statutory claims against Caliber3 for (1) a hostile work environment,

disparate treatment, and retaliation in violation of sections 2000e-2a and 2000e-3a of the Civil

Rights Act of 1964, 42 U.S.C.A. §§ 2000e–2000e17 (West 2012) (Title VII); (2) failing to

accommodate his health issues in violation of section 12203(A) of the Americans with Disabilities

     1
         Both of these arguments appear to be directed at whether Williams’s claims are barred by the statute of limitation.
     2
         This pleading is not in the appellate record.
     3
       Although not included in the style of the case, Williams named as parties in the body of the first amended petition five individuals employed
by Caliber.

                                                                        –2–
Act, 42 U.S.C.A. §§ 12101–12213 (West 2013) (ADA); and (3) disclosing his personal

information in violation of the Occupational Safety and Health Administration Act, 29 U.S.C.A.

§§ 651–678 (West 2018), and the Health Insurance Portability and Accountability Act, 42

U.S.C.A. §§ 1320d–1320d-9 (West 2012). Williams also asserted common law claims for fraud

and fraud in the inducement, defamation, intentional infliction of emotional distress, invasion of

privacy, slander/libel, unjust enrichment, negligent failure to provide a safe workplace, and

negligent hiring, supervision, or management. The factual bases of all of Williams’s claims was

the harassment and threats he allegedly experienced while employed at Caliber, statements made

by Caliber employees to the IPD and the FPD following Williams’s December 21, 2013 call,

Caliber’s actions following the telephone call and in investigating the allegations, Caliber’s refusal

to allow Williams to work from home to accommodate his health issues, and Caliber’s termination

of Williams’s employment.

          On April 15, 2016, Williams again requested to amend his complaint. Caliber consented

to the amendment and, on April 25, 2016, Williams filed a second amended complaint in which

he alleged additional facts related to his work at Caliber and Caliber’s investigation of his

complaints.4 Williams asserted claims for racial harassment, discrimination, and retaliation in

violation of 42 U.S.C.A. § 1981 (West 2012); hostile work environment, disparate treatment, and

retaliation in violation of Title VII; failure to accommodate his health issues in violation of the

ADA; and discrimination on the basis of age in violation of the Age Discrimination in Employment

Act, 29 U.S.C.A. § 621–634 (West 2018) (ADEA) and the Texas Commission on Human Rights

Act, TEX. LAB. CODE ANN. §§ 21.001–.556 (West 2015 & Supp. 2017) (TCHRA).

          Williams filed a motion to modify the federal district court’s scheduling order on May 18,

2016, and requested leave to again amend his complaint. Williams asserted he had discovered the

   4
       Caliber was the only defendant identified in the second amended complaint.

                                                                    –3–
IPD had issued a BOLO for him on March 13, 2014, and that Caliber had provided information

that was used in the BOLO. Williams alleged he had been arrested because of the BOLO and had

been damaged due to the existence of the BOLO. Attached to Williams’s motion was a proposed

third amended complaint5 that listed Caliber, the City of Irving, a former Caliber employee, and

employees of the IPD as defendants and added factual allegations based on the BOLO. As to

Caliber, the complaint asserted statutory claims for racial harassment, discrimination, and

retaliation in violation of 42 U.S.C. § 1981; hostile work environment, disparate treatment, and

retaliation in violation of Title VII; failure to accommodate his health issues in violation of the

ADA; and discrimination based on age in violation of the ADEA and the TCHRA. Williams also

asserted common law claims against Caliber for “defamation/slander,” “defamation/libel,”

intentional infliction of emotional distress, and invasion of privacy.

          After the federal district court denied his motion to amend the complaint, Williams filed a

notice of voluntarily dismissal of his case without prejudice. Caliber objected to Williams being

allowed to dismiss his claims without prejudice, arguing it had incurred significant expenses in the

case, had dispositive motions pending, and would be deprived of legal defenses if Williams was

allowed to re-file his claims. Treating Williams’s notice of voluntary dismissal as a motion to

dismiss, the federal district court determined Caliber would “suffer plain legal prejudice from a

dismissal without prejudice” and that dismissal with prejudice was appropriate. The federal

district court provided Williams with an opportunity to withdraw his motion to dismiss and

cautioned him that a “failure to timely withdraw his motion [would] constitute acceptance of the

dismissal with prejudice.” Williams did not withdraw his motion to dismiss, and the federal district

court dismissed Williams’s claims with prejudice on December 16, 2016.

   5
       Williams erroneously entitled this document “Second Amended Complaint.”

                                                                 –4–
           Williams filed his original petition in the 298th Judicial District Court (the trial court) on

March 17, 2017. The factual allegations in the petition were based on Williams’s December 21,

2013 call to the IPD, the IPD’s report of the call to Caliber, and Caliber’s subsequent conduct,

including revealing information about Williams to the IPD that was used in the BOLO. Williams

contended that, on March 17, 2016, his attorney in an “online impersonation case” provided him

with the BOLO that had been produced in discovery by the Collin County District Attorney’s

Office. Based on the information provided by Caliber’s employees to the IPD and the FPD,

Williams asserted claims for “defamation/slander,” “defamation/libel,” intentional infliction of

emotional distress, and invasion of privacy.

           Caliber filed a motion for traditional summary judgment on grounds Williams’s claims

were barred by res judicata, the applicable statutes of limitations, and quasi-judicial immunity. As

summary judgment evidence, Caliber relied on pleadings from the federal district court case and

emails from the parties’ settlement negotiations in which Williams stated he had been “advised to

file the motion that I filed and bring the case back at a later date; but this time with an attorney and

properly conducting discovery.”

           Williams responded by filing an amended original petition that included additional facts

related to the allegedly defamatory statements made by Caliber’s employees to the IPD following

Williams’s December 21, 2013 call that resulted in the BOLO being issued. Based on the

statements made by Caliber’s employees to the IPD and the FPD, Williams asserted claims for (1)

“defamation/slander (per quod)”; (2) “defamation/libel (per se)”; (3) intentional infliction of

emotional distress; (4) invasion of privacy; (5) civil conspiracy; (6) negligent hiring, retention, and

supervision; (7) negligence; (8) bystander claim for mental anguish on behalf of his son;6 (9)

negligence per se based on violations of various statutes including Title VII and 42. U.S.C. § 1981;

    6
        Williams’s son was not named as a plaintiff.

                                                       –5–
(10) gross negligence; (11) intrusion on physical or mental solitude or seclusion; (12) unreasonable

investigation, shadowing, and trailing; (13) public disclosure of private information; (14)

unauthorized publication of a story about an individual’s private marital affairs; (15) unauthorized

disclosure of an individual’s mental health information; and (16) breach of duty of reasonable care

by a professional.

       Williams also filed a response to Caliber’s motion for summary judgment, but did not

attach any summary judgment evidence. Williams argued the federal district court case related to

“violations that were discoverable prior to 02/12/2014,” while this case was based on “violations”

that occurred after that date. Williams stated he tried to consolidate the claims based on the BOLO

in the federal district court case, but the federal district court denied the request. Williams argued:

       This resulted in the splitting of the causes of actions [sic] into three cases: 1.) the
       State causes of actions [sic] against Caliber covering violations discoverable from
       08/05/2013 to present, 2.) the Federal causes of actions [sic] against Caliber
       covering violations discoverable from 08/05/2013 to 02/12/2014, and 3.) the
       Federal causes of actions [sic] against The Irving Police Department covering
       violations discoverable from 02/12/2014 to 04/18/2016.

Williams conceded his claims in the federal district court case had been dismissed with prejudice,

but argued his current claims were not barred (1) by res judicata because they were not the same

causes of action asserted in the federal district court and Caliber did not obtain a final judgment

on the merits; (2) by the statute of limitations because of the “continuing violation theory,”

equitable tolling, the discovery rule, and “post-charge retaliation”; or (3) by quasi-judicial

immunity because many of the complained-of statements were made by Caliber’s employees after

the IPD had completed its investigation.

       At the hearing on Caliber’s motion for summary judgment, Caliber’s attorney argued only

that summary judgment should be granted based on res judicata because that doctrine precluded

all of Williams’s claims. The trial court granted Caliber’s motion without specifying its basis for

doing so.
                                                 –6–
                                       Standard of Review

       We review the granting of a motion for summary judgment de novo. Lujan v. Navistar,

Inc., 61 Tex. Sup. Ct. J. 982, 2018 WL 1974473, at *3 (Apr. 27, 2018). To be entitled to a

traditional summary judgment, the movant must show no genuine issue of material fact exists and

the movant is entitled to judgment as a matter of law. TEX. R. CIV. P. 166a(c); Lujan, 2018 WL
1974473, at *3. A defendant moving for traditional summary judgment on an affirmative defense

must conclusively establish each essential element of the defense. Frost Nat’l Bank v. Fernandez,

315 S.W.3d 494, 508 (Tex. 2010); Randall’s Food Mkts, Inc. v. Johnson, 891 S.W.2d 640, 644

(Tex. 1995). If the movant carries this burden, the nonmovant must then raise a genuine issue of

material fact precluding summary judgment. Lujan, 2018 WL 1974473, at *3.

       In reviewing a traditional summary judgment, we consider the evidence in the light most

favorable to the nonmovant, indulging every reasonable inference and resolving any doubts against

the motion. Schlumberger Tech. Corp. v. Pasko, 544 S.W.3d 830, 833 (Tex. 2018) (per curiam).

We credit evidence favorable to the nonmovant if a reasonable factfinder could, and disregard

contrary evidence unless a reasonable factfinder could not. Samson Exploration, LLC v. T.S. Reed

Props., Inc., 521 S.W.3d 766, 774 (Tex. 2017).

                                           Res Judicata

       The doctrine of res judicata “prevents the relitigation of a claim or cause of action that has

been finally adjudicated, as well as related matters that, with the use of diligence, should have been

litigated in the prior suit.” Barr v. Resolution Trust Corp., 837 S.W.2d 627, 628 (Tex. 1992); see

also Allen v. McCurry, 449 U.S. 90, 94 (1980) (“Under res judicata, a final judgment on the merits

of an action precludes the parties or their privies from relitigating issues that were or could have

been raised in that action.”). When the assertion of a defense of res judicata relies on a lawsuit

decided in federal court, federal law determines whether the subsequent state court proceeding is

                                                 –7–
barred. San Antonio Indep. Sch. Dist. v. McKinney, 936 S.W.2d 279, 281 (Tex. 1996). The res

judicata effect of a prior judgment is a question of law that we review de novo. Portillo v.

Cunningham, 872 F.3d 728, 733 (5th Cir. 2017).

       Res judicata applies to bar a claim in a subsequent suit when (1) the parties to both actions

are identical or in privity; (2) the prior judgment was rendered by a court of competent jurisdiction;

(3) the prior action was a final judgment on the merits; and (4) the same claim or cause of action

is involved in both actions. Petro-Hunt, L.L.C. v. United States, 365 F.3d 385, 395 (5th Cir. 2004);

see also Retractable Technologies, Inc. v. Becton Dickinson & Co., 842 F.3d 883, 898 (5th Cir.

2016), cert. denied, 137 S. Ct. 1349 (2017). To determine whether two suits involve the same

claim under the fourth element, federal courts utilize the “transactional test.” Oreck Direct, LLC

v. Dyson, Inc., 560 F.3d 398, 401–02 (5th Cir. 2009). Under that test, the issue is whether the two

actions under consideration “are based on the same nucleus of operative facts.” Retractable

Technologies, Inc. 842 F.3d at 899 (quoting United States v. Davenport, 484 F.3d 321, 326 (5th

Cir. 2007)). “The nucleus of operative facts, rather than the type of relief requested, substantive

theories advanced, or types of right asserted, defines the claim.” Davenport, 484 F.3d at 326. If

the two cases are based on the same nucleus of operative facts, the prior judgment’s preclusive

effect “extends to all rights the original plaintiff had ‘with respect to all or any part of the

transaction, or series of connected transactions, out of which the [original] action arose.’” Petro-

Hunt, L.L.C., 365 F.3d at 395–96 (quoting RESTATEMENT (SECOND) OF JUDGMENTS § 24(1)); see

also Oreck Direct, LLC, 560 F.3d at 402.

       What factual grouping constitutes a “transaction,” or what groupings constitute a “series

of transactions,” is determined pragmatically, giving weight to such considerations as whether the

facts are related in time, space, origin, or motivation, whether they form a convenient trial unit,

and whether their treatment as a unit conforms to the parties’ expectations or business

                                                 –8–
understanding or usage. Petro-Hunt, L.L.C., 365 F.3d at 396; see also Retractable Technologies,

Inc., 842 F.3d at 899. Res judicata “bars all claims that were or could have been advanced in

support of the cause of action on the occasion of its former adjudication, . . . not merely those that

were adjudicated.” In re Howe, 913 F.2d 1138, 1144 (5th Cir. 1990) (quoting Nilsen v. City of

Moss Point, 701 F.2d 556, 559 (5th Cir. 1983) (en banc)).

       Williams does not dispute that Caliber conclusively established the first two elements of

the test—that the parties are identical and the federal district court was a court of competent

jurisdiction. Williams also concedes in his brief that the allegations in this case “included nearly

the exact same facts and causes of actions” as alleged in the proposed third amended petition in

the federal district court, but asserts he is not precluded from bringing claims based on facts that

had not been discovered during the discovery period in the federal district court case and could not

be raised in the federal district court due to the expiration of the discovery period. Williams argues

“it was impossible to raise, plead or litigate those claims,” the federal district court did not “hear”

any pleadings that included facts associated with the BOLO, and there was not a final judgment in

the federal district court as to his “claims arising from Calibers [sic] participation in the creation

of a fraudulent BOLO and the distribution and publication of the contents of [his] employment file

and medical records.”

       The federal district court dismissed Williams’s claims with prejudice. “A dismissal with

prejudice is a final judgment on the merits” for purposes of claim preclusion. Brooks v. Raymond

Dugat Co. L C, 336 F.3d 360, 362 (5th Cir. 2003); see also Griener v. United States, No. 17-30465,

2018 WL 3976935, at *4 (5th Cir. Aug. 20, 2018). Further, when leave to amend a complaint has

been sought and denied, the plaintiff:

       [H]as the burden of either pursuading [sic] the court to designate the dismissal as
       “without prejudice,” or of appealing. Otherwise a dismissal for failure to state a
       claim is res judicata “as to the existing claim which it appears plaintiff was
       attempting to state” . . . . [I]f plaintiff seeks to file an amended complaint, and leave
                                                 –9–
           is denied with prejudice, the denial is res judicata as to any claim in the proposed
           amended complaint[.]

Fernandez-Montes v. Allied Pilots Ass’n, 987 F.2d 278, 284 n.8 (5th Cir. 1993) (quoting 1B

MOORE’S FEDERAL PRACTICE para. 0.409[1.–2] at 310 n.13 (2d ed. 1992)); see also Prof’l Mgmt.

Assocs., Inc. v. KPMG LLP, 345 F.3d 1030, 1032 (8th Cir. 2003) (per curiam) (“[D]enial of leave

to amend constitutes res judicata on the merits of the claims which were the subject of the proposed

amended pleading.”); RESTATEMENT (SECOND) OF JUDGMENTS § 25 cmt. b (“It is immaterial that

the plaintiff in the first action sought to prove the acts relied on in the second action and was not

permitted to do so because they were not alleged in the complaint and an application to amend the

complaint came too late.”).7 Accordingly, res judicata applies to any claims that Williams

attempted to assert in the third amended petition in the federal district court.

            Our review of the third amended complaint in the federal district court and the amended

petition in this case confirms both cases are based on allegations that Caliber employees made

statements and provided information to the IPD following Williams’s December 21, 2013 call that

led to the issuance of the BOLO and the existence of the BOLO has caused Williams to suffer

damages. Further, all of the complained-about conduct occurred before Williams filed his

complaint in the federal district court on July 17, 2015, and Williams was aware of the existence

of the BOLO before he filed either the first or second amended complaints in the federal district

court. Under the transactional test’s pragmatic considerations, all the claims in the federal district

court case and in this case arise from the same nucleus of operative facts and are the same claim

or cause of action for purposes of res judicata. See Snow Ingredients, Inc. v. SnoWizard, Inc., 833
F.3d 512, 522 (5th Cir. 2016) (concluding res judicata bars recovery “when a party seeks to

relitigate the same facts even when the party argues a novel legal theory”).

     7
       See also Concha v. London, 62 F.3d 1493, 1507 (9th Cir. 1995) (By obtaining a dismissal with prejudice in the first action, the plaintiff
“submit[ted] to a judgment that serves to bar his claims forever.”).

                                                                    –10–
          We conclude Caliber conclusively established that Williams’s claims in this case are barred

by the doctrine of res judicata. Accordingly, we resolve Williams’s first issue against him and

affirm the trial court’s judgment.8

                                                                          /Robert M. Fillmore/
                                                                          ROBERT M. FILLMORE
                                                                          JUSTICE

170760F.P05

   8
       Based on our resolution of Williams’s first issue, we need not address his second two issues. See TEX. R. APP. P. 47.1.

                                                                     –11–
                               Court of Appeals
                        Fifth District of Texas at Dallas
                                       JUDGMENT

 MICHAEL WILLIAMS, Appellant                         On Appeal from the 298th Judicial District
                                                     Court, Dallas County, Texas,
 No. 05-17-00760-CV          V.                      Trial Court Cause No. DC-17-03199.
                                                     Opinion delivered by Justice Fillmore,
 CALIBER HOME LOANS, Appellee                        Justices Lang and Schenck participating.

     In accordance with this Court’s opinion of this date, the judgment of the trial court is
AFFIRMED.

       It is ORDERED that appellee Caliber Home Loans recover its costs of this appeal from
appellant Michael Williams.

Judgment entered this 17th day of September, 2018.

                                              –12–