Court Opinion

ID: 6690
Source: CourtListenerOpinion
Date Created: 2010-04-25 05:20:09+00
Date Added: 2024-06-11T16:46:12.394996
License: Public Domain

United States Court of Appeals,

                               Fifth Circuit.

                                No. 93-2683.

             Jolene NOWLIN, et al., Plaintiffs-Appellants,

                                        v.

          RESOLUTION TRUST CORPORATION, et al., Defendants,

 Resolution Trust Corporation, Litton Mortgage Servicing Center,
Inc., and Mitchell Jobe & Co., Defendants-Appellees.

                               Sept. 29, 1994.

Appeal from the United States District Court for the Southern
District of Texas.

Before GOLDBERG, KING and WIENER, Circuit Judges.

       GOLDBERG, Circuit Judge:

       This case resulted from the termination of employment of nine

former   employees    at   a   failed       financial   institution.   These

individuals ("plaintiffs") sued the Resolution Trust Corporation

("RTC"), which was the receiver of the institution, and two of the

RTC's personnel contractors, Litton Mortgage Servicing Center, Inc.

("Litton") and Mitchell Jobe & Company ("Mitchell Jobe") (together,

the "defendants").     The plaintiffs sought relief on several causes

of action.    The first was retaliatory discharge in violation of 12

U.S.C. § 1831j (the "Banking Whistleblower Act").             The second and

third were violations of 42 U.S.C. § 2000e-3 ("Title VII"), for

sexual discrimination and retaliatory discharge.                Finally, the

plaintiffs claimed a breach of oral contract under Texas common

law.    The district court granted summary judgment in favor of the

defendants on all claims, and the plaintiffs appealed to this

                                        1
court.       We partially affirm and partially reverse the district

court's          grant    of    summary    judgment     and    remand      for   further

proceedings.

I. Facts1

       Columbia Savings Association, Nassau Bay, was a federally

insured, state-chartered institution.                   In December 1989, it was

placed in the conservatorship of the RTC.                        The institution was

succeeded by Columbia Federal Savings Association ("Columbia") when

the Federal Home Bank Loan Board issued it a federal charter.                           The

change in name did not spell a change in fortune, and in September

1991 the RTC put Columbia into receivership and picked up the

reins.

       The       RTC     contracted     with   Mitchell   Jobe      to    meet   some   of

Columbia's staffing needs.                Mitchell Jobe hired seventeen former

Columbia employees for the receivership.                   The plaintiffs in this

case       are    nine    of    those   individuals.       The      plaintiffs    signed

employment         contracts       with   Mitchell     Jobe,     which     stated   that

employment would be "for an unspecified amount of time and for

limited projects of a temporary nature...."                    The RTC paid Mitchell

Jobe a fee in addition to the amount of the temporary employees'

wages.

       The       RTC     also   contracted     with   Litton   to    be   a   Resolution

       1
      Because the plaintiffs are appealing the district court's
grant of summary judgment to the defendants, we view the evidence
in the record in the light most favorable to the plaintiffs.
See, e.g., Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475
U.S. 574, 587-88, 106 S. Ct. 1348, 1356, 89 L. Ed. 2d 538 (1986);
Trevino v. Celanese Corp., 701 F.2d 397, 406 (5th Cir.1983)
(citing Joplin v. Bias, 631 F.2d 1235, 1237 (5th Cir.1980)).

                                               2
Assistance Contractor (RAC).      Litton's task was twofold.           First,

Litton was to wind down Columbia's affairs by returning assets to

Columbia's     former     customers       and   extinguishing       Columbia's

liabilities.    Second, and most important in this case, Litton was

to supervise the day-to-day activities which engaged the employees

at Columbia.    Litton installed a three-member management team to

accomplish these goals.      The RTC compensated Litton according to

number of hours the Litton team worked.

     In September, Columbia's employees were gathered and told

about   the    Columbia's    transformation        into    a     receivership.

Representatives of the RTC and Litton encouraged the plaintiffs to

accept positions with the receivership.           No one disputes that the

plaintiffs entered "at will" employment contracts with Mitchell

Jobe.   However,    the    plaintiffs     claim   they    also   entered   oral

contracts with the RTC and Litton guaranteeing them four months of

employment plus two weeks severance pay.             During the September

gathering, Tom Emerson, the manager of the Litton team, represented

to the plaintiffs that their employment would be for at least four

months, that they would receive two weeks severance pay, and that

if they refused the job, he would challenge their applications for

unemployment benefits.       The RTC and Litton dispute plaintiffs'

claim that an oral contract arose and insist that the plaintiffs'

only contracts were those with Mitchell Jobe.

     The plaintiffs and Litton had a difficult relationship from

the start.     One of the plaintiffs, Jolene Nowlin, alleged that

Emerson began a campaign of sexual harassment soon after Litton was

                                      3
installed at the receivership.               In addition, Emerson orchestrated

a   scheme    to    increase    Litton's         fees.    Emerson    instructed      the

plaintiffs to inflate their time sheets by adding three to three

and a half hours to the amount of time they actually worked.                         He

stated that he would verify the falsified time sheets.                               The

plaintiffs complied at first, but then reported the time sheet

fraud and sexual harassment to the RTC.                         The plaintiffs also

claimed that the Litton team was unable to perform their management

functions effectively due to ignorance and incompetence.

      After an investigation by members of the RTC and Litton, the

entire    Litton     team     was   replaced       with   one    headed   by   Carolyn

McDonald.          However,    this    did    not    ease   the    friction     in   the

receivership's operation.             Specifically, there were confrontations

regarding the plaintiffs' responsibilities.                       In addition, the

plaintiffs complained to the RTC that the new team was also

ineffective.        Nowlin complained about the Litton team to an RTC

official, Robert Van Buren.             Van Buren later met with Litton and

Mitchell Jobe representatives, and asked Mitchell Jobe to discharge

Nowlin.      Linda Wood, the Mitchell Jobe personnel manager, refused,

stating that Mitchell Jobe preferred to build a documented file

upon which to base Nowlin's termination.

      RTC officials met on Friday October 18, 1991 and decided to

accelerate Columbia's "final resolution" date and merge Columbia's

assets and liabilities with another failed institution.                        Litton's

and the plaintiffs' employment would be terminated, and Columbia

would be closed.        Later that afternoon, representatives from the

                                             4
RTC and Litton went to Columbia, gathered the employees, and told

them to pack their belongings and to never return. The plaintiffs,

in turn, filed this lawsuit.

II. Standard of Review for Summary Judgment

        Summary judgment is proper under Rule 56 of the Federal Rules

of Civil Procedure if there is "no genuine issue as to any material

fact and ... the moving party is entitled to judgment as a matter

of law."     Anderson v. Liberty Lobby Inc., 477 U.S. 242, 257, 106
S. Ct. 2505, 2514, 91 L. Ed. 2d 202 (1986).                "[T]he plaintiff must

present    affirmative    evidence   in   order    to     defeat   a   properly

supported motion for summary judgment."           Id.    This requires that a

plaintiff "make a showing sufficient to establish the existence of

an[y] element essential to that party's case, and on which that

party will bear the burden of proof at trial."            Celotex v. Catrett,

477 U.S. 317, 322-23, 106 S. Ct. 2548, 2552, 91 L. Ed. 2d 265 (1986).

The standard for reviewing a summary judgment on appeal is the same

as that applied by the district court.            Reid v. State Farm Mut.

Auto Ins. Co.,     784 F.2d 577, 578 (5th Cir.1986);                   see also

Bodenheimer v. PPG Industries, Inc., 5 F.3d 955, 956 (5th Cir.1993)

(reviewing     grant     of    summary    judgment       in   an   employment

discrimination case).         We review a grant of summary judgment de

novo.    Norman v. Apache Corp., 19 F.3d 1017 (5th Cir.1994).

     While the record reveals a complex pattern of criss-crossing

motions, we concern ourselves only with the last few.                  Mitchell

Jobe filed a motion to dismiss the plaintiffs' second amended

complaint for failure to state a claim upon which relief can be

                                      5
granted.    Litton filed no similar motion.   The district court, sua

sponte, treated Mitchell Jobe's motion as one for summary judgment.

The court issued a two-page opinion and order granting partial

final judgment in favor of Mitchell Jobe and Litton.    The district

court stated that the RTC alone was the plaintiff's "employer

in-fact," and that the plaintiffs would therefore take nothing from

Mitchell Jobe or Litton.2

     Shortly after the district court entered this order, the RTC

moved for summary judgment.   The plaintiffs resisted, filing their

own motion for summary judgment against the RTC and Litton.3     The

district court held a hearing on these motions.     At the end of the

hearing, the district court granted summary judgment in favor of

the RTC on all claims except the Texas common law oral contract

claim.     He later ruled in favor of the RTC and Litton on that

issue, too.    We will review the grant of summary judgment on each

issue in turn.

III. The Banking Whistleblower Statute, 12 U.S.C. § 1831j

         In examining the plaintiffs whistleblowing claim, we must

examine the patchwork of legislation woven by Congress to protect

our nation's banking system. The plaintiffs have asked us to apply

12 U.S.C. § 1831j, a statute which focuses on the Federal Deposit

     2
      We assume the district court meant that the RTC was the
plaintiffs' employer at law, as the parties never disputed that
Mitchell Jobe was the employer in fact in this case. Mitchell
Jobe had written employment "at will" contracts with the
plaintiffs, paid the plaintiffs, and furnished the plaintiffs to
the RTC and Litton.
     3
      The plaintiffs moved for summary judgment against Litton on
oral contract grounds.

                                  6
Insurance Corporation ("FDIC"), to the RTC and its contractors.

Section 1831j has been amended twice since October 1991,4 when the

alleged misconduct occurred.

     The   plaintiffs   claim   to   be   the   victims   of   retaliatory

discharge in violation of § 1831j.5        The applicable version of §

1831j prohibits two types of actors from retaliating against

whistleblowers.   The first type consists of "insured depository

institutions," defined as "any bank or savings association the

deposits of which are insured by the [Federal Deposit Insurance]

Corporation...." 12 U.S.C. § 1813(c)(2). The second type consists

of "Federal banking agenc[ies], Federal home loan bank[s], and the

Federal Reserve Bank[s]."       Pub.L. No. 102-242, § 251, 105 Stat.

     4
      The section was amended by the FDIC Improvement Act of
1991, Pub.L. No. 102-242, § 251, 105 Stat. 2331, 2332 (1991), and
by Pub.L. No. 103-204, § 21(a), 107 Stat. 2406 (1993).
     5
      The 1991 version of this section, which Congress made
retroactive, covers the time period of the relevant conduct. See
Pub.L. No. 102-242, § 251(a)(4) (1991) ("Paragraph (2) of section
33(a) of the Federal Deposit Insurance Act [12 U.S.C. §
1831j(a)(2) ] (as added under the amendment made by paragraph
(1)) shall be treated as having taken effect on January 1, 1987,
and for purposes of any cause of action arising under such
paragraph (as so effective) before the date of the enactment of
this Act [December 19, 1991], the 2-year period referred to in
section 33(b) of such Act [12 U.S.C. § 1831j(b) ] shall be deemed
to begin on such date of enactment."). The 1991 version changed
the original statutory language in only minor ways which are
irrelevant to the case at hand.

          The third version of the statute has a broader scope
     than the first two. That version, passed in 1993, nearly
     two years after the whistleblowing conduct in this case,
     expanded the reach of § 1831j to include "any person who is
     performing, directly or indirectly, any function or service
     on behalf of the [Federal Deposit Insurance] Corporation."
     Pub.L. No. 103-204, § 21(a), 107 Stat. 2406 (1993).
     Congress did not state that this section was retroactive.

                                     7
2331, 2332 (1991).            "Federal banking agencies" are defined as "the

[Federal Deposit Insurance] Corporation, the Board of Governors of

the Federal Reserve System, the Federal Housing Finance Board, the

Comptroller of the Currency, and the Director of the Office of

Thrift Supervision."            Pub.L. No. 102-242, § 251(a).

       Courts applying § 1831j have held that it only applies to the

actors named in the statute.                     See Hicks v. Resolution Trust

Corporation, 970 F.2d 378 (7th Cir.1992);                    Homeyer v. Yorkville

Federal Savings & Loan Association, 1991 WL 274226 (S.D.N.Y.1991);

cf., Walleri v. Federal Home Loan Bank, 1993 WL 566023 (D.Or.1993)

(dismissing claim of retaliatory discharge under § 1831j because

plaintiff reported alleged wrongdoings to institutions not listed

in statute). We find the applicable statutory language to be plain

on its face.         It does not name the RTC, and the plaintiffs concede

that Mitchell Jobe and Litton do not fall within either of the two

categories of covered actors. Therefore, § 1831j does not apply in

this       case,    because    none   of   the    defendants   are     named   in   the

statutory coverage.6              We affirm the district court's grant of

summary judgment in favor of defendants on the § 1831j claim.

IV. Title VII

       The         next   claim       envisages      Title     VII's     provisions.

       6
      The subsequent actions of Congress reinforce our
interpretation of the scope of § 1831j. In 1992, while this
litigation was underway, Congress passed a whistleblowing statute
specifically addressing the RTC and its contractors. See 12
U.S.C. § 1441a(q). The plaintiffs did not plead for relief under
this provision. Congress apparently did not think § 1831j
applied to the RTC, otherwise they would not have passed §
1441a(q). Section 1441a(q) does not apply to this case, because
it was passed after the alleged impermissible conduct occurred.

                                            8
Specifically, the plaintiffs argue that the district court wrongly

concluded that Mitchell Jobe and Litton were not the plaintiffs'

"employers" for Title VII purposes.            In addition, the plaintiffs

argue the district court wrongly granted summary judgment to the

RTC on the Title VII issues.

     First   we    address    Mitchell     Jobe's   argument   that   summary

judgment should be affirmed because Mitchell Jobe was not properly

a party on the Title VII issue.7            Mitchell Jobe summarized its

argument for affirming summary judgment in its brief, stating

"[p]laintiffs     did   not   file   charges   with   the   EEOC   [the   Equal

Employment Opportunity Commission] and, therefore, they have no

standing to assert Title VII claims against Mitchell Jobe in

federal court."     Title VII requires charges to be filed with the

EEOC against those who committed the allegedly unlawful conduct.

42 U.S.C. § 2000e-5(e).        The plaintiffs admitted that they never

filed such charges against Mitchell Jobe before the EEOC. Instead,

the plaintiffs argue that their failure to file charges naming

Mitchell Jobe is not lethal to their Title VII claims,8 and does

not necessarily prevent them from pursuing Mitchell Jobe in federal

court.   See Zipes v. Trans World Airlines, 455 U.S. 385, 393, 102
S. Ct. 1127, 1132, 71 L. Ed. 2d 234 (1982) (holding that "filing a

     7
      We have the authority to do this. Degan v. Ford Motor Co.,
869 F.2d 889, 892 (5th Cir.1989) ("Summary judgment may be
affirmed, regardless of the correctness of the district court
ruling, when we find in the record an adequate, independent basis
for that result.").
     8
      Debra Boles, one of the plaintiffs, conceded she did not
file a complaint against any of the defendants with the EEOC, and
that therefore she cannot recover on Title VII grounds.

                                       9
timely     charge   of     discrimination     with    the   EEOC   was   not   a

jurisdictional      prerequisite    to    suit   in   federal   court,   but   a

requirement that, like a statute of limitations, is subject to

waiver, estoppel, and equitable tolling.") (footnote omitted).

     Plaintiffs claim they should be excused from the filing

requirement because the EEOC misled them about the nature of their

rights. See Blumberg v. HCA Management Co., 848 F.2d 642, 644 (5th

Cir.1988), cert. denied, 488 U.S. 1007, 109 S. Ct. 789, 102 L. Ed. 2d
781 (1989) (stating that one justification for tolling the period

for filing charges with the EEOC would be if the EEOC misled the

plaintiff).     Blumberg also stated that the plaintiff bears the

burden of demonstrating a factual basis to toll the period for

filing charges.      Id.     The only references found in the record to

anything misleading involve a statement by plaintiffs' counsel that

"[t]he EEOC concluded that it would not accept complaints against

Mitchell-Jobe because it was only a payroll service." This unsworn

statement is found in a document filed with the district court

entitled "Status Report with Respect to EEOC Complaints."

         The district court failed to give ten days notice of its sua

sponte motion to grant summary judgment9, as required by Federal

     9
      District courts may grant summary judgment sua sponte, "so
long as the losing party was on notice that she had to come
forward with all of her evidence." Celotex, 477 U.S. at 326, 106
S.Ct. at 2554; Judwin Properties, Inc., v. United States Fire
Ins. Co., 973 F.2d 432, 436-37 (5th Cir.1992); see also Wright,
Miller and Kane, Federal Practice and Procedure § 2720 (1994
Pocket Part).

                                         10
Rule of Civil Procedure 56(c).10    This court has strictly enforced

this notice requirement.   Leatherman v. Tarrant County Narcotics

Intelligence & Coordination Unit, 28 F.3d 1388 (5th Cir.1994)11;

Judwin Properties Inc., 973 F.2d at 437 (5th Cir.1992);    Powell v.

U.S., 849 F.2d 1576, 1579 (5th Cir.1988) (stating that notice is

critical "to insure that the nonmoving party had the opportunity to

make every possible factual and legal argument.") (citing cases).

Despite this strictness, however, this circuit has held that the

     10
      The district court issued its opinion after Mitchell Jobe
submitted a motion to dismiss the plaintiffs' second amended
complaint for failure to state a claim upon which relief can be
granted under Federal Rule of Civil Procedure 12(b)(6). That
rule states that "[i]f, on a motion asserting the defense
numbered (6) to dismiss for failure of the pleading to state a
claim upon which relief can be granted, matters outside the
pleading are presented to and not excluded by the court, the
motion shall be treated as one for summary judgment and disposed
of as provided in Rule 56, and all parties shall be given
reasonable opportunity to present all material made pertinent to
such a motion by Rule 56." (emphasis supplied). The comment to
Rule 12(b)(6) specifically states that the rule "insures that
both parties shall be given a reasonable opportunity to submit
affidavits and extraneous proofs to avoid taking a party by
surprise through the conversion of the motion into a motion for
summary judgment." Cf., Washington v. Allstate Insurance Co.,
901 F.2d 1281, 1284 (5th Cir.1990).
     11
      The Leatherman litigation has a long history. The
district court originally dismissed the action on the grounds
that the plaintiffs failed to satisfy the "heightened pleading
requirement" imposed by our circuit on claims arising under 42
U.S.C. § 1983. In the alternative, the district court granted
summary judgment against the plaintiffs. See 755 F. Supp. 726
(N.D.Tex.1991). This court affirmed the dismissal on the
heightened pleading requirement grounds. 954 F.2d 1054 (5th
Cir.1992). The Supreme Court reversed and remanded. --- U.S. --
--, 113 S. Ct. 1160, 122 L. Ed. 2d 517 (1993). Justice Rehnquist,
writing for a unanimous court, invalidated the heightened
pleading requirement in regard to § 1983 actions against
municipalities. Id. at ----, 113 S.Ct. at 1163. On remand, the
district court adopted its alternate holding and granted summary
judgment against the plaintiffs. The plaintiffs appealed again,
and we affirmed. 28 F.3d 1388 (5th Cir.1994).

                                   11
harmless error doctrine applies to a failure to provide notice

under Rule 56(c).       Leatherman, 28 F.3d at 1398;           Powell, 849 F.2d

at 1580 (citing Western Fire Insurance Co. v. Copeland, 786 F.2d
649 (5th Cir.1986)).      The Leatherman court noted that the harmless

error doctrine has recently been expanded.

     "When there is no notice to the nonmovant, summary judgment
     will be considered harmless if the nonmovant has not
     additional evidence or if all of the nonmovant's additional
     evidence is reviewed by the appellate court and none of the
     evidence presents a genuine issue of material fact."

Leatherman, 28 F.3d at 1398 (quoting Resolution Trust Corp. v.

Sharif-Munir-Davidson Dev. Corp., 992 F.2d 1398, 1403 n. 7 (citing

Powell )).

      In our recent cases, we have held that "[d]espite the

strictness with which we enforce the notice requirement, the

harmless error doctrine applies to lack of notice required by Rule

56(c)."    Leatherman, 28 F.3d at 1398;            Sharif-Munir-Davidson Dev.

Corp., 992 F.2d at 1403 (stating that the district court abused its

discretion by granting summary judgment without sufficient notice,

but affirming outcome because the lack of notice was harmless

error).    We have held that the party seeking to avoid summary

judgment must present specific evidence that creates a genuine

issue of     material   fact,   or   at    least    identify    how   additional

discovery would yield such an issue.          Leatherman, 28 F.3d at 1399;

Sharif-Munir-Davidson Dev. Corp., 992 F.2d at 1403.               This evidence

must have some present, existential character.                 "Rule 56(e) ...

requires the nonmoving party to go beyond the pleadings and by her

own affidavits, or by the "depositions, answers to interrogatories,

                                      12
and admissions on file,' designate "specific facts showing that

there is a genuine issue for trial.' "              Celotex Corp., 477 U.S. at

324, 106 S.Ct. at 2553;             see also Rivanna Trawlers Unlimited v.

Thompson Trawlers Inc., 840 F.2d 236, 240 (4th Cir.1988) (noting

that a party opposing summary judgment "may not rest upon mere

allegations or denials of his pleading");                Lake Nacimiento Ranch

Co. v. County of San Luis Obispo, 841 F.2d 872, 876 (9th Cir.1987),

cert. denied, 488 U.S. 827, 109 S. Ct. 79, 102 L. Ed. 2d 55 (1988)

(noting that the district court properly required nonmovant to make

"sufficient showings" supporting essential elements of its case);

Presbyterian      Church       v.    United    States,      752 F. Supp. 1505

(D.Ariz.1990) ("Legal memoranda and oral argument do not constitute

evidence      within   the    meaning    of    Rule   56(e),      and   cannot,    by

themselves, create a factual dispute sufficient to defeat a summary

judgment      motion   where    no    other   dispute    exists.")      (citations

omitted).      If the nonmovant fails to make such a showing, and the

motion is otherwise appropriate, then the lack of notice will be

considered harmless error, and summary judgment will be affirmed.

See Leatherman, 28 F.3d at 1398-99;                 Sharif-Munir-Davidson Dev.

Corp., 992 F.2d at 1403.

       In this case, the plaintiffs failed to produce one shred of

hard evidence to support their argument that it was not necessary

to   charge    Mitchell      Jobe    before   the   EEOC.      In   addition,     the

plaintiffs failed to state what the evidence they wanted to present

was or why they needed more time.             Instead, the plaintiffs rely on

one unsworn statement made by their attorney in a pleading.                       The

                                         13
notice requirement of Rule 56(c) is not a license for a fishing

expedition for evidence, and conjecture and conversation with the

court are not a sufficient specific showing of solid evidence to

shield one from summary judgment.             See Mitnik v. Cannon, 789
F. Supp. 175, 176 (E.D.Pa.1992) (holding that unsworn statements and

allegations "are not sufficient ... to raise a genuine issue of

material fact" under Rule 56).              Therefore, we affirm summary

judgment in favor of Mitchell Jobe on the Title VII issues.

     We now turn to the basic issue of determining the plaintiffs'

employment status under Title VII.          The district court stated that

the RTC      was   the   plaintiffs'   "employer   in-fact"   in   its   order

granting partial final judgment on the Title VII issues, holding

that Mitchell Jobe and Litton were not the plaintiffs' employers.12

The judge based this conclusion on the borrowed servant doctrine,

citing two cases, Denton v. Yazoo & M.V.R. Co., 284 U.S. 305, 52
S. Ct. 141, 76 L. Ed. 310 (1932) and Perron v. Bell Maintenance &

Fabricators, 970 F.2d 1409, 1412 (5th Cir.1992), cert. denied, ---

U.S. ----, 113 S. Ct. 1264, 122 L. Ed. 2d 660 (1993).            Both of those

cases involved employee injuries, not discriminatory hiring and

firing.

          The borrowed servant doctrine is not applied in Title VII

actions to determine employer status.         The Fifth Circuit announced

     12
      The district court repeated the conclusion that the RTC
was the employer "for equal employment opportunity purposes" from
the bench during the hearing on the cross motions for summary
judgment filed by the RTC and the plaintiffs, stating "[Mitchell]
Jobe and Litton are out of [the case]. They were flunkies for
the RTC...." See supra n. 2.

                                       14
the standard it would use in potential multiple employer situations

to determine employer status in Mares v. Marsh, 777 F.2d 1066, 1067

(5th Cir.1985) (adopting the hybrid test defined in Spirides v.

Reinhardt, 613 F.2d 826 (D.C.Cir.1979)).13            In Mares, the court

examined     three   possible   tests,      labeled   "agency,"   "economic

realities," and "hybrid."       The agency test turns on the employer's

right to control the employee.        Id.     The economic realities test

turns on whether the employee, as a matter of economic reality, is

dependent upon the business to which he renders service.           Id.   The

hybrid test steers a middle ground, focussing on "the extent of the

employer's right to control the "means and manner' of the worker's

performance."    Id.   (quoting Spirides, 613 F.2d at 831).

      The articulation, elaboration, and application of the hybrid

test was first accomplished by the Spirides court, which suggested

a laundry list of factors for courts to consider when utilizing the

hybrid test.     The court warned that "[c]onsideration of all the

circumstances of the work relationship is essential, and no one

factor is determinative." Id. at 831 (footnote omitted).           See also

Deal v. State Farm County Mut. Ins. Co. of Texas, 5 F.3d 117, 118-

19 (5th Cir.1993) (applying hybrid test to determine whether

insurance company was insurance agent's employer under Title VII

and ADEA);    Fields v. Hallsville Indep. Sch. Dist., 906 F.2d 1017,

     13
      We note that as a preliminary issue, the defendant must
fall within the statutory definition of "employer" in Title VII.
See 42 U.S.C. § 2000e(b). Neither Mitchell Jobe nor Litton
allege anywhere that they do not fall within this statutory
definition of employer. For purposes of this appeal, we assume
that they do fall within this definition.

                                    15
1019-20 (5th Cir.1990), cert. denied, 498 U.S. 1026, 111 S. Ct. 676,

112 L. Ed. 2d 668 (1991) (applying hybrid test to determine whether

Texas was teachers' employer under Title VII).       The Mares court

accepted the Spirides factors, but noted that the right to control

is an especially crucial factor.      Mares, 777 F.2d at 1067-68.

     The district court wove its decision to grant partial final

judgment to Mitchell Jobe and Litton on the Title VII issues with

fragile thread.     The court stated that because the RTC exercised

"operating control over all the employees of the bank," the RTC was

the plaintiff's employer.      The court stated that "the nominal

employers14 had neither control over the plaintiffs nor any role in

the actions taken against them," and granted final judgment to

Mitchell Jobe and Litton.

     The borrowed servant doctrine and the agency test are cut from

the same cloth.15   The Supreme Court case the district court cited

for support explained the borrowed servant doctrine in a suit

involving a railroad employee who was injured while loading mail

under the direction of the post office.    The Court's analysis under

     14
       It is interesting that the district court   referred to the
"nominal employers," plural, apparently meaning    Mitchell Jobe and
Litton. The record does not reveal any written     contract or
agreement between Litton and the plaintiffs for    employment. This
may be relevant in addressing the oral contract    issue discussed
below.
     15
      We repeat that the borrowed servant test uses criteria
similar to the agency test expressly rejected by the Mares court.
777 F.2d at 1067 n. 1 ("The strict common law "agency' test
generally has not been applied to federal social welfare and
antidiscrimination legislation, since it is considered
inconsistent with the remedial purposes behind such
legislation.") (citing cases).

                                 16
the borrowed servant doctrine turned on who controlled and directed

the employee's work.16

     In light of Mares and its progeny, we find that the district

court committed an error of law when clothing its decision in the

ill-fitting borrowed servant doctrine rather than the well-tailored

hybrid    test   to   determine   whether   the   defendants   were   the

plaintiffs' employer under Title VII.       The "right to control" is a

common and important thread running through the borrowed servant

doctrine, agency test, and hybrid test.       However, the hybrid test

is fabricated with additional threads to yield a different pattern.

Broussard v. L.H. Bossier, Inc., 789 F.2d 1158, 1160 (5th Cir.1986)

(repeating the Spirides laundry list of factors in addition to the

right to control in a single employer Title VII case).         The grant

of summary judgment regarding Title VII unravels because the court

below applied the wrong legal standard to determine employee

status.   On remand, the hybrid test, as enunciated in Spirides and

adopted and applied in Mares, is an appropriate starting point for

determining whether Litton is an employer under Title VII.17

     16
      "Whether the railroad company may be held liable for [the
employee's] act depends not upon the fact that he was their
servant generally, but upon whether the work which he was doing
at the time was their work or that of another; a question
determined, usually at least, by ascertaining under whose
authority and command the work was being done. When one person
puts his servant at the disposal and under the control of another
for the performance of a particular service for the latter, the
servant in respect to his acts in that service, is to be dealt
with as the servant of the latter and not the former." Denton v.
Yazoo & M. V. R. Co., 284 U.S. 305, 308, 52 S. Ct. 141, 141, 76
L. Ed. 310 (1932).
     17
      The factors listed in Spirides, in addition to the right
to control are:

                                    17
     The   district       court   did    not       specifically         address      the

conflicting   interpretations       of       the    evidence      in        the   record

concerning Litton's possible status as an employer under Title VII

in its opinion granting partial final judgment to Litton. There is

evidence in the record concerning Litton's relationship to the

plaintiffs.   Without commenting on the strength or persuasiveness

of this evidence, we find that there may be a genuine issue of

material fact regarding Litton's employer status. On remand to the

district   court,   the    record   should         be    carefully     examined      and

evaluated in applying the hybrid test in determining whether Litton

is an employer for Title VII purposes.

     The   individual     defendants     argue          that   even    if    they   were

considered the plaintiffs' employer under Title VII, they would be

entitled to summary judgment on the retaliatory discharge issue.

They claim that the plaintiffs failed to carry their legal burden,

as described by the cases applying Title VII.                         See Whatley v.

           "(1) the kind of occupation, with reference to whether
           the work usually is done under the direction of a
           supervisor or is done by a specialist without
           supervision; (2) the skill required in the particular
           occupation; (3) whether the "employer' or the
           individual in question furnishes the equipment used and
           the place of work; (4) the length of time during which
           the individual has worked; (5) the method of payment,
           whether by time or by the job; (6) the manner in which
           the work relationship is terminated; i.e., by one or
           both parties, with or without notice and explanation;
           (7) whether annual leave is afforded; (8) whether the
           work is an integral part of the business of the
           "employer'; (9) whether the worker accumulates
           retirement benefits; (10) whether the "employer' pays
           social security taxes; and (11) the intention of the
           parties."

     Spirides, 613 F.2d at 832.

                                        18
Metropolitan Atlanta Rapid Transit Auth., 632 F.2d 1325 (5th

Cir.1980);     McKenna v. Weinberger, 729 F.2d 783 (D.C.Cir.1984).

Plaintiffs    contend           they    were     discharged        in       retaliation     for

reporting allegations of sexual harassment by Emerson.

     The    Supreme       Court        has   recently     reexamined          the   elaborate

tapestry of shifting burdens in Title VII suits in St. Mary's Honor

Ctr. v. Hicks, --- U.S. ----, ---- - ----, 113 S. Ct. 2742, 2747-53,

125 L. Ed. 2d 407 (1993).                The Court set out to untangle the basic

burden shifting process by identifying three procedural steps. One

proceeds to the next step only after the prior one is made.

         First, the plaintiffs must establish a prima facie case of

the alleged wrongdoing by a preponderance of the evidence.                                 Once

the prima facie case is established, there is a presumption of

discrimination.           Second,        the    defendant        must       articulate     some

legitimate, nondiscriminatory reason for discharging the employee.

Once this step is taken, the presumption of discrimination created

by the prima facie case is pierced.                       In order to patch their

discrimination claim, the plaintiffs must prove that the legitimate

reason    articulated       by     the       defendant    was     false       and   that   the

defendant's    real        reason        for    discharging           the    plaintiff      was

discriminatory       or     otherwise          prohibited        by    Title     VII.       The

plaintiffs    bear        the     ultimate       burden     of     proving       intentional

discrimination at all times.                   Id. at ---- - ----, 113 S. Ct. at

2747-48;    see also Fields v. Hallsville Independent School Dist.,

906 F.2d 1017 (5th Cir.1990);                Shirley v. Chrysler First, Inc., 970
F.2d 39, 42 (5th Cir.1992).

                                               19
        The plaintiffs' prima facie case for retaliation under Title

VII is woven from three threads.                 The claimant must demonstrate:

(1) that she engaged in a statutorily protected activity; (2) that

she    experienced        an    adverse    employment        action    following      the

protected activity;            and (3) that a causal link exists between the

protected activity and the adverse employment action. Shirley, 970
F.2d at       42;    Whatley, 632 F.2d   at    1328;     Jenkins      v.    Orkin

Exterminating Co., 646 F. Supp. 1274, 1277 (E.D.Tex.1986).                          In its

motion for summary judgment, the RTC did not dispute that the

plaintiffs had the first two parts of the prima facia case.18

Instead, the        RTC    claimed    that   plaintiffs        had    no   evidence    of

causation. The RTC concluded that the plaintiffs' prima facia case

fell apart without the causation thread to stitch together their

statutorily protected activities and their termination.

       The RTC contends that its decision to accelerate the "final

resolution" of Columbia was the cause of the plaintiffs' employment

termination.        It argues that this decision did not offend Title

VII, because it caused the termination of all of the employees at

Columbia, not just the plaintiffs. Further, it claims the decision

was motivated by economic reasons.                 Therefore, the RTC concludes

that    the    plaintiffs        cannot    prove      that    they    were   fired     in

retaliation for protected conduct.

        The courts have sketched an outline of indicia of causation

in Title VII cases, because causation is difficult to prove.

       18
      Litton did not submit a brief on the issue, because the
district court dismissed the Title VII claims against it earlier.

                                           20
Employers rarely leave concrete evidence of their retaliatory

purposes and motives.       For example, in Jenkins, the court looked to

three factors for guidance in determining causation.                    First, the

court examined the employee's past disciplinary record.                     Second,

the court investigated whether the employer followed its typical

policy and procedures in terminating the employee.                      Third, it

examined the temporal relationship between the employee's conduct

and discharge.      Jenkins, 646 F. Supp. at 1278.               This analysis is

highly fact specific, as the Supreme Court recently noted.                        St.

Mary's, --- U.S. at ----, 113 S. Ct. at 2756 ("the question facing

triers of fact in discrimination cases is both sensitive and

difficult.") (quoting United States Postal Service Bd. of Governors

v. Aikens, 460 U.S. 711, 716, 103 S. Ct. 1478, 1482, 75 L. Ed. 2d 403

(1983)).     On    remand   to     the    district     court,   there   may      be   a

conclusion of causation in the discriminatory discharge issue based

on a development and analysis of the facts.

V. Oral Contract

      The    plaintiffs     argued       below   that    they   entered     an   oral

contract    with   Litton    and    the    RTC   for    at   least   four     months

employment and two weeks severance pay.                The district court, in a

memorandum opinion, concluded that "[t]here is no evidence of any

oral contract, only the assertion by the plaintiffs."                     The court

granted summary judgment against the plaintiffs on this issue.

     The plaintiffs contend that there are two employment contracts

in this case.      First, there is the written contract for "at will"

employment between Mitchell Jobe and the plaintiffs.                        Second,

                                          21
plaintiffs    argue   that    there    is   an   oral   contract   between    the

plaintiffs, Litton, and the RTC.             The plaintiffs have produced

evidence, in the form of affidavits and depositions to support

their contentions.     The defendants have also produced evidence to

support their argument that the written contract with Mitchell Jobe

is the only employment contract existing in this case.

     Determining whether there are two contracts or one contract,

and what the parties intended the terms these contracts to embrace,

is a very fact specific endeavor.            Foreca, S.A. v. GRD Dev. Co.,

758 S.W.2d 744, 746 (Tex.1988) (holding that questions concerning

the formation and terms of a particular contract, and the intent of

the parties, were properly considered questions of fact for a jury

to decide);    Cothron Aviation, Inc. v. Avco Corp., 843 S.W.2d 260,

264 (Tex.App.—Ft. Worth 1992) (reviewing grant of summary judgment

on question of whether an oral settlement agreement was formed);

cf., McClure v. Duggan, 674 F. Supp. 211 (N.D.Tex.1987).                       The

plaintiffs and defendants have articulated conflicting summary

judgment   evidence.         Without    commenting      on   the   strength    or

credibility of this evidence, we find that the parties have raised

a genuine issue of material fact regarding the possible existence

of an oral contract and the terms of any contracts between the

parties.     Therefore, we reverse the district court's grant of

summary judgment and remand this issue to the district court to

allow the fact finder to sort through the evidence and iron out the

inconsistencies.

VI. Conclusion

                                       22
     We AFFIRM district court's grant of summary judgment to

defendants on the 12 U.S.C. § 1831j claims.    We AFFIRM summary

judgment in favor of Mitchell Jobe on the Title VII claims.    We

REVERSE and REMAND the district court's grant of summary judgment

to the RTC and Litton on the Title VII claims.    We REVERSE AND

REMAND the district court's grant of summary judgment to the RTC

and Litton on the oral contract claims.

                               23