Burgmann Seals America, Inc. v. Cadenhead

• Citation: 135 S.W.3d 854
• Decision Date: 19 February 2004
• Docket Number: No. 01-02-00293-CV.,01-02-00293-CV.
• Parties: BURGMANN SEALS AMERICA, INC., Appellant v. Jim CADENHEAD, Appellee.
• Court: Court of Appeals of Texas

135 S.W.3d 854

BURGMANN SEALS AMERICA, INC., Appellant v. Jim CADENHEAD, Appellee.

No. 01-02-00293-CV.

Court of Appeals of Texas, Houston (1st Dist.).

February 19, 2004.

Augustus T. White, Chamberlain, Hrdlicka, White, Williams & Martin, Houston, TX, for Appellant.

Mark Siurek, Warren & Siurek, L.L.P., Houston, TX, for Appellee.

Panel consists of Justices NUCHIA, ALCALA, and HANKS.

OPINION

SAM NUCHIA, Justice.

Burgmann Seals America, Inc. (BSA), appellant and defendant below, appeals a judgment awarding $100,500 in attorney's fees and $13,275 in expert fees to appellee, Jim Cadenhead, in his employment discrimination lawsuit.¹ We reverse and render.

BACKGROUND

BSA is a wholly owned subsidiary of Burgmann Dichtungswerke GmbH & Co., a German corporation. On October 1, 1995, BSA hired Cadenhead as its national sales manager. In early 1999, when the president of BSA was terminated, Cadenhead sought the vacant position. Tom Haan was named as the new president, and, on August 17, 1999, Haan terminated Cadenhead. Cadenhead filed an age-discrimination complaint with the Equal Employment Opportunity Commission (EEOC) and, on his application, checked the box requesting simultaneous filing with the Texas Commission on Human Rights (TCHR). On June 16, 2000, more than 180 days after filing his complaint with the EEOC, and not having heard from the TCHR, Cadenhead sued BSA in the court below, claiming that BSA violated the Texas Commission on Human Rights Act (TCHRA) by discriminating against him because of his age in failing to promote him to the position of president and in discharging him. Cadenhead also asserted that BSA had breached its contract with him by failing to give him a 60-day notice before discharging him and by failing to pay him part of his commission.

The case was tried to a jury, which found that (1) age was a motivating factor in BSA's decision not to promote Cadenhead; (2) BSA would have taken the same action of not promoting Cadenhead in the absence of the impermissible discrimination; (3) Cadenhead suffered no damages as a result of BSA's conduct; (4) BSA engaged in a discriminatory practice with malice or reckless indifference to Cadenhead's rights; (5) age was not a motivating factor in BSA's decision to discharge Cadenhead; (6) $450,000 should be assessed against BSA as exemplary damages to Cadenhead for BSA's discriminatory practice with malice; (7) BSA failed to comply with the terms of the employment agreement with Cadenhead; (8) $6,923.08 would compensate Cadenhead for his breach-of-contract damages; and (9) $112,500 was a reasonable fee for Cadenhead's attorney. The trial court disregarded the exemplarydamages finding and, in the final judgment, awarded Cadenhead $6,923.08 as damages for breach of contract, $13,275 for expert fees, and $100,500 for attorney's fees. BSA presents 11 issues challenging the trial court's subject matter jurisdiction under the TCHRA, appealing the award of attorney's fees and expert fees, and challenging the trial court's findings of fact and conclusions of law that are related to Cadenhead's status as prevailing party, the award of attorney's fees, and the award of expert fees.²

DISCUSSION

Standard of Review

The appellant must challenge the sufficiency of the trial court's findings in its issues on appeal or the findings are binding on the appellate court. IKB Indus. (Nigeria) Ltd. v. Pro-Line Corp., 938 S.W.2d 440, 445 (Tex.1997). If the appellant challenges the findings in its issues, the appellate court will review the legal and factual sufficiency of the evidence to support the findings in the same manner it reviews a jury's findings in a jury trial. Escobar v. Escobar, 728 S.W.2d 474, 475 (Tex.App.-San Antonio 1987, no writ); State Bar of Texas v. Roberts, 723 S.W.2d 233, 235 (Tex.App.-Houston [1st Dist.] 1986, no writ). In reviewing the legal sufficiency of the evidence, the court can consider only the evidence and inferences that tend to support the finding, and must disregard all evidence and inferences to the contrary. Weirich v. Weirich, 833 S.W.2d 942, 945 (Tex.1992). In reviewing the factual sufficiency of the evidence, the court must consider all evidence in the record, both in support of, and contrary to, the finding. Lofton v. Texas Brine Corp., 720 S.W.2d 804, 805 (Tex.1986).

A trial court's conclusions of law are reviewed de novo. Nelkin v. Panzer, 833 S.W.2d 267, 268 (Tex.App.-Houston [1st Dist.] 1992, writ dism'd w.o.j.).

Subject-Matter Jurisdiction

In its first supplemental issue, BSA contends that the trial court lacked subject-matter jurisdiction to hear Cadenhead's claims under the TCHRA because he did not exhaust his administrative remedies. BSA cites Smith v. University of Texas Southwestern Medical Center to support its contention that merely filing a complaint with the EEOC is not sufficient to exhaust the administrative remedies under the TCHRA. See 101 S.W.3d 185 (Tex.App.-Dallas 2003, no pet.). In Smith, the plaintiff reported her charge of discrimination to the EEOC, but did not check the box for simultaneous filing with the TCHR. Id. at 188.

Unlike the plaintiff in Smith, Cadenhead did not merely file his complaint with the EEOC. On his charge form, Cadenhead inserted "Texas Commission on Human Rights" as the state agency and checked the box that stated, "I want this charge filed with both the EEOC and the State or local Agency, if any." We hold that providing the name of the TCHR and checking the box for simultaneous filing is the equivalent of filing with the TCHR.³

BSA further argues that it is TCHR's receipt and investigation of the complaint that fulfills the exhaustion requirement and that Cadenhead has not shown that TCHR had addressed his complaint. BSA does not support its argument with any case law.

The Fourteenth Court of Appeals, in analyzing sections 21.201, 21.202, 21.208, and 21.256 of the Labor Code, has determined, "To comply with the exhaustion requirement under the [TCHRA], an aggrieved employee must do the following: (1) file with the Texas Commission on Human Rights ...; (2) allow the Commission 180 days to dismiss or resolve the complaint before filing suit; and (3) file suit in district court no later than two years after the complaint is filed with the Commission." City of Houston v. Fletcher, 63 S.W.3d 920, 922 (Tex.App.-Houston [14th Dist.] 2002, no pet.). The court concluded that a complainant's exhaustion of remedies in a discrimination complaint occurs when the complainant files a timely charge with TCHR and waits 181 days to file suit. Id. We agree with our sister court.

In this case, Cadenhead's filing with the EEOC and checking the box for simultaneous filing with the TCHR were sufficient to file his complaint with the TCHR. He was entitled to file suit 181 days after filing his complaint with the TCHR and was required to file suit within two years. Cadenhead had exhausted his remedies, and the trial court had jurisdiction to hear Cadenhead's claims under the TCHRA. Accordingly, we overrule BSA's first supplemental issue.

Prevailing Party

In its first issue, BSA contends, among other things, that Cadenhead did not show his entitlement to attorney's fees under sections 21.259(a) and 21.125(b) of the Texas Labor Code. In its third supplemental issue, BSA contends that the trial court erred in finding that Cadenhead was a prevailing party and challenges findings of fact 8 through 11 and conclusions of law 2 through 5, 7 through 9, and 11.⁴ BSA argues that Cadenhead was not the prevailing party and was not entitled to attorney's fees because he was not awarded any actual damages as a result of his agediscrimination claims and was not awarded any non-monetary relief, such as reinstatement or an injunction. As support for its position, BSA relies on Farrar v. Hobby, 506 U.S. 103, 113 S.Ct. 566, 121 L.Ed.2d 494 (1992).

Cadenhead responds that, to be a prevailing party, it was not necessary to establish that he benefitted directly as a result of the lawsuit. He argues that he need only show that he succeeded on a significant issue in the litigation, which achieved some of the benefit that the parties sought in bringing the suit, citing E.E.O.C. v. Clear Lake Dodge, 60 F.3d 1146, 1153 (5th Cir.1995). Cadenhead contends that he met his burden to show that he succeeded on a significant issue based on the jury findings that age was a motivating factor in BSA's decision not to promote him and that the discrimination was with malice or reckless indifference to his rights and the jury award of $450,000 in exemplary damages.

Cadenhead's argument is contrary to the Supreme Court's holding in Farrar. There, the Court reaffirmed that "a plaintiff [must] receive at least some relief on the merits of his claim before he can be said to prevail." Farrar, 506 U.S. at 110, 113 S.Ct. at 572 (quoting Hewitt v. Helms, 482 U.S. 755, 760, 107 S.Ct. 2672, 2675-76, 96 L.Ed.2d 654 (1987)). The Court reasoned that "a judicial pronouncement that the defendant has violated the Constitution, unaccompanied by an enforceable judgment on the merits, does not render the plaintiff a prevailing party. Of itself, `the moral satisfaction [that] results from any favorable statement of law' cannot bestow prevailing party status." Id., 506 U.S. at 112, 113 S.Ct. at 573-74 (quoting Hewitt, 482 U.S. at 762, 107 S.Ct. at 2676). The Court held that a plaintiff who recovers only nominal damages is a prevailing party. Id., 506 U.S. at 112, 113 S.Ct. at 573. However, the Court also stated, "When a plaintiff recovers only nominal damages because of his failure to prove an essential element of his claim for monetary relief, the only reasonable fee is usually no fee at all." Id., 506 U.S. at 115, 113 S.Ct. at 575. In Farrar, the trial court awarded one dollar as nominal damages. The Supreme Court held that the court of appeals had correctly reversed the trial court's award of attorney's fees. Id., 506 U.S. at 116, 113 S.Ct. at 575...