Arguello v. Conoco, Inc.

• Decision Date: 05 May 2003
• Docket Number: No. 01-11549.,01-11549.
• Citation: 330 F.3d 355
• Parties: Denise ARGUELLO, et al., Plaintiffs, Denise Arguello and Alberto Govea, Plaintiffs-Appellants, v. CONOCO, INC., Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

330 F.3d 355

Denise ARGUELLO, et al., Plaintiffs, Denise Arguello and Alberto Govea, Plaintiffs-Appellants, v. CONOCO, INC., Defendant-Appellee.

No. 01-11549.

United States Court of Appeals, Fifth Circuit.

May 5, 2003.

Hal K. Gillespie (argued), Susan D. Motley, Gillespie, Rozen & Watsky, Dallas, TX, Gilbert Arrazolo, Aguilar Law Offices, Albuquerque, NM, for Plaintiffs-Appellants.

Ronald E. Manthey, Steven R. McCown, Paulo B. McKeeby (argued), Littler Mendelson, Dallas, TX, Warren Reid Williamson, ConocoPhillips, Houston, TX, for Defendant-Appellee.

Michael Lutz Foreman (argued), Lawyers' Committee for Civil Rights Under Law, Washington, DC, for Lawyers' Committee for Civil Rights Under Law, Amicus Curiae.

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

Before SMITH, BARKSDALE and EMILIO M. GARZA, Circuit Judges.

JERRY E. SMITH, Circuit Judge:

Denise Arguello and Alberto Govea appeal (1) a judgment as a matter of law ("j.m.l.") on their claims of race discrimination in violation of 42 U.S.C. § 1981 and (2) the denial of their claims for injunctive relief under 42 U.S.C. § 2000a. Arguello and Govea, both of whom are Hispanic, entered a store owned by Conoco, Inc. ("Conoco"), intending to purchase gasoline and other items. There was a heated confrontation, during which the employee made several racially derisive remarks. Arguello and Govea allege that they were deprived of their ability to enter into a contract on nondiscriminatory terms as prohibited by § 1981. The jury decided for plaintiffs, but the district court granted Conoco's motion for j.m.l. under FED. R.Civ.P. 50(b). See Arguello v. Conoco, Inc., 2001 WL 1442340, 2001 U.S. Dist. LEXIS 18471 (N.D.Tex. Nov. 9, 2001) (No. 397-CV-0638-H). Finding no error, we affirm.

I.

Arguello and Govea stopped with their family at a Conoco store. After Arguello's husband pumped gas into her car, Arguello and Govea (her father) went inside to pay for the gas and buy some beer. As they stood in line, Cindy Smith, one of the two clerks on duty, waited on other customers. Arguello testified that Smith was rude to her when she reached the counter and that her demeanor was less friendly than it had been with the customers she had previously served. After Arguello presented her credit card as payment, Smith requested identification. Arguello testified that Smith singled her out by demanding that she provide identification; Smith contends that she requested identification because Arguello was attempting to buy beer.

Arguello, an Oklahoma resident, presented Smith with her valid Oklahoma driver's license. Smith initially refused to accept it, claiming she could not take an out-of-state license, but she eventually accepted it and completed the transaction. During Arguello's purchase, Govea became increasingly frustrated with the manner in which Smith was treating his daughter. Consequently, he left the beer he had intended to purchase on the counter and walked out of the store.

After Smith completed Arguello's sale, the tension between them escalated into a confrontation. Arguello testified that Smith began shouting obscenities at her and making racially derogatory remarks. Arguello began to leave with her purchase, but realized that she had the wrong copy of the credit card slip and approached the counter again. After another argument, Arguello and Smith exchanged copies. As Arguello walked away the second time, Smith shoved a six-pack of beer off the counter and onto the floor.

Plaintiffs testified that after Arguello left the store, Smith began screaming racist remarks over the intercom. At the same time, Smith laughed at Arguello and her family and made several crude gestures. Govea and other family members telephoned Conoco from a payphone outside the store to lodge a complaint. During that telephone conversation, the Conoco official indicated that he wanted to know the name of the clerk in question. When Govea attempted to re-enter the store to determine Smith's name, Smith locked him out while laughing and making crude gestures.

Arguello and Govea sued Conoco under 42 U.S.C. §§ 1981 and 2000a.¹ The jury found for plaintiffs on the § 1981 claim and awarded compensatory and punitive damages. The court granted j.m.l., finding that the record provided no basis upon which a reasonable jury could conclude that plaintiffs were prevented, on a discriminatory basis, from entering into a contractual relationship in violation of § 1981.

II.

We review a j.m.l. de novo. Coffel v. Stryker Corp., 284 F.3d 625, 630 (5th Cir.2002). A j.m.l. is appropriate only where "there is no legally sufficient basis for a reasonable jury to find for [a] party." FED.R.CIV.P. 50(a)(1); accord Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 139, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000). Thus, a motion for j.m.l. in a jury case is a challenge to the sufficiency of the evidence supporting the verdict. Flowers v. S. Reg'l Physician Servs., 247 F.3d 229, 235 (5th Cir.2001).

In assessing the legal sufficiency of the evidence, we consider the entire trial record in the light most favorable to the nonmovant, drawing reasonable inferences in his favor. Burch v. Coca-Cola Co., 119 F.3d 305, 313 (5th Cir.1997). An issue is properly submitted to the jury where there is a conflict in substantial evidence — "evidence of such quality and weight that reasonable and fair-minded men in the exercise of impartial judgment might reach different conclusions." Boeing Co. v. Shipman, 411 F.2d 365, 374-75 (5th Cir.1969) (en banc), overruled on other grounds, Gautreaux v. Scurlock Marine, Inc., 107 F.3d 331 (5th Cir.1997) (en banc).

To succeed on a § 1981 claim, a plaintiff must establish "(1) that she is a member of a racial minority; (2) that [the defendant] had intent to discriminate on the basis of race; and (3) that the discrimination concerned one or more of the activities enumerated in the statute." Morris v. Dillard Dep't Stores, Inc., 277 F.3d 743, 751 (5th Cir.2001). The first element is not disputed — all parties concede that Arguello and Govea are Hispanic. Further, the testimonial and other evidence provides a basis for concluding that Smith subjected Arguello to substandard service. In conjunction with that evidence of maltreatment, the testimony regarding the racially charged nature of Smith's comments sufficed to create a jury question regarding whether Smith intentionally discriminated against plaintiffs on the basis of race. Therefore, this case turns on the third element, namely, whether Smith's conduct implicated rights guaranteed by § 1981.

A.

Section 1981 does not provide a general cause of action for race discrimination.² Rather, it prohibits intentional race discrimination with respect to certain enumerated activities.³ At issue here is plaintiffs' ability "to make and enforce contracts" on nondiscriminatory terms. 42 U.S.C. § 1981(a).

To establish a deprivation of § 1981 rights in the retail context, the plaintiff must demonstrate "the loss of an actual, not speculative or prospective, contract interest."⁴ An allegation of "the mere possibility that a retail merchant would interfere with a customer's right to contract in the future" is insufficient to support recovery under § 1981. Morris, 277 F.3d at 752 (collecting cases). Instead, the plaintiff "must offer evidence of some tangible attempt to contract" that in some way was "thwarted" by the defendant. Id.

The law in this circuit for § 1981 claims in the retail context is established by Morris. There, this court plainly stated the rule that "where a customer has engaged in an actual attempt to contract that was thwarted by the merchant, courts have been willing to recognize a § 1981 claim." Morris, 277 F.3d at 752 (emphasis added.) The Morris court cited with approval, inter alia, Henderson v. Jewel Food Stores, Inc., 1996 WL 617165, 1996 U.S. Dist. LEXIS 15796 (N.D.Ill. Oct. 23, 1996) (No. 96-C-3666), as "holding that `a § 1981 claim must allege that the plaintiff was "actually prevented, and not merely deterred," from making a purchase or receiving service after attempting to do so.'" Morris, id. (emphasis added). The Morris court summarized its holding by stating that "Morris must offer evidence of some tangible attempt to contract with Dillard's during the course of the ban, which could give rise to a contractual duty between her and the merchant, and which was in some way thwarted." Id. (emphasis added).⁵

Govea cannot make that showing. Although his decision to abandon his purchase resulted from Smith's mistreatment of his daughter, Smith did not actually interfere with an attempted purchase. According to Govea's own testimony, he voluntarily set the beer on the counter and left without trying to buy it. Consequently, there is no basis on which a reasonable jury could conclude that Smith prevented Govea from making a purchase. Nor can Smith's later conduct in locking him out of the store support a claim under § 1981, because his subsequent attempts to gain entry into the store were, again by his own admission, not to buy anything but to determine Smith's name so he could provide it to a Conoco representative.

B.

Arguello likewise cannot establish interference with an actual contract interest. Her claim must fail, because she successfully completed the transaction.⁶ Having received all she was entitled to under the retail-sales contract, she cannot demonstrate any loss recoverable under § 1981.⁷

1.

Plaintiffs argue for a broader interpretation of the § 1981 right to "make and enforce contracts" on equal terms such that it would cover conduct occurring after the consummation of a retail-sales contract. They note that 42 U.S.C. § 1981(b), enacted as part of the Civil Rights Act of 1991, extends the reach of § 1981 by defining the term "make and enforce contracts" to include "the making, performance, modification, and termination of contracts, and the enjoyment of all benefits,...