The Supreme Court of Texas issued two important opinions in December 2023: One of which dealing with a savings statute for the statute of limitations and another regarding the applicability of “but for” causation in adverse employment actions.

Sanders, et al. v. The Boeing Company, et al.

In a personal injury suit involving a couple of flight attendants for a major airline, the Supreme Court of Texas answered a certified question from the U.S. Court of Appeals for the Fifth Circuit concerning the breadth of a savings statute that tolls statutes of limitations.

Lee Marvin Sanders and Matthew Sodrok sustained injuries in connection with their employment as flight attendants for United Airlines. The flight attendants sued Boeing Company and other defendants in federal district court, which later dismissed their suit for failure to adequately plead diversity jurisdiction—despite the parties agreeing that the flight attendants could have invoked the district court’s jurisdiction if they had included proper allegations. The federal Fifth Circuit affirmed and shortly afterwards, the flight attendants filed suit in state court. Boeing removed the state court action to federal district court in Houston; the Houston court dismissed the flight attendants’ claims on the basis that Section 16.064 did not toll limitations because the federal district court in Dallas was not deemed the “wrong court”. The appeal from the Houston federal district court’s dismissal served as the basis for the Texas Supreme Court’s December 2023 opinion.

On appeal to the Fifth Circuit, the flight attendants argued that Section 16.064 of the Texas Civil Practice and Remedies Code tolled the applicable statute of limitations while they pursued their prior suit because that case was dismissed for lack of jurisdiction and they filed this suit less than sixty days after the Fifth Circuit affirmed the prior judgment and denied their petition for rehearing en banc.  Section 16.064 tolls limitations where a prior action is dismissed “because of lack of jurisdiction” and refiled in a court of “proper jurisdiction” within 60 days after the date the dismissal “becomes final.”

The Fifth Circuit certified two questions to the Supreme Court: (1) Does Section 16.064 apply to this lawsuit where the flight attendants could have invoked the prior district court’s subject-matter jurisdiction with proper pleadings? and (2) Did the flight attendants file this lawsuit within sixty days of when the prior judgment became “final” for purposes of Section 16.064? The Supreme Court of Texas answered “yes” to both.

The purpose of Section 16.064 is to protect plaintiffs who mistakenly file suit in a forum that lacks jurisdiction. As to the first question, the Court noted that the Court’s prior cases did not require the court to consider the distinction between a court that “lacks jurisdiction” and a court that dismisses an action “because of lack of jurisdiction” when it could have had jurisdiction. The Court concluded that the statute does not support a “wrong court” requirement in the sense many courts have described and applied it. Boeing argued that the statute requires that the prior court could never have properly acquired jurisdiction and was thus in fact the “wrong court.”

The Court disagreed that the prior action must be dismissed because of “lack of  jurisdiction” to invoke the protections of Section 16.064.  The requirement is satisfied when a court dismisses an action because of lack of jurisdiction, regardless of whether the court erred and actually had jurisdiction or could have had jurisdiction had the claims been pleaded differently.

As to the second question, the parties agreed that the 60-day period began after the initial dismissal order was signed and became “final”. However, the parties disagreed at what point the order became final.  The Supreme Court explained, “We do not wholly discount Boeing’s concern about the length of time appellate proceedings could extend a limitations period. But the inevitable alternative under Boeing’s proposed construction is to require claimants to quickly file a second action and then either forfeit their right to appeal the dismissal for lack of jurisdiction or litigate the appeal and the second action simultaneously[.]”

Boeing also argued that a trial court’s order “becomes final” when the court loses plenary power, because Section 16.064 is meant to give plaintiffs who file in the wrong court an opportunity to refile in the proper court, and when the trial court dismisses for lack of jurisdiction, “the plaintiff is on notice” at that point in time. Again, the Court did not find this argument persuasive since “no one knows if the trial court truly lacked jurisdiction until any appeals from the dismissal order have been exhausted,” and “[u]ntil that point, the trial court’s dismissal order may be ‘final’ (and thus appealable), but the ‘dismissal’ itself is not.” Therefore, final means when the appellate remedies have thoroughly exhausted and the courts’ power to alter the dismissal has ended.

Scott & White Memorial Hospital dba Baylor Scott & White McLane Children’s Medical Center aka Baylor Scott & White Health v. Thompson, R.N.

This case concerns the causation standard at the summary-judgment stage in an employment discrimination lawsuit. Dawn Thompson worked as a registered nurse at Scott & White Memorial Hospital. She had received two prior reprimands for violating the hospital’s personal conduct policy. The second reprimand warned that any future violation “will result in separation from employment.” Thompson then received a third reprimand.

Thompson had become concerned that the parents of a child patient were not properly managing the child’s medications. Thompson called the child’s school nurse and disclosed the child’s health information, which Scott & White claimed was a HIPAA violation. Thompson then reported her concerns to Child Protective Services. After the child’s mother complained to the hospital, it fired Thompson. The form documenting her termination stated, “As a result of this [HIPAA] violation your employment is being terminated immediately.” It also included the statement: “Furthermore a CPS referral was made without all details known to Ms. Thompson.”

Plaintiff sued the hospital for a violation of § 261.110(b), Family Code, which prohibits an employer from taking an adverse employment action against a professional who reports suspected abuse to CPS. The hospital moved for summary judgment on the basis that it terminated the employee for violating its policy, not for reporting suspected abuse. The trial court granted the motion. Thompson appealed, arguing that she raised a genuine fact issue as to whether the hospital fired her for making the report. The El Paso Court of Appeals agreed and remanded to the trial court. The hospital appealed.

The Supreme Court of Texas reversed and rendered judgment in favor of the hospital. The Court applied the same causation standard to § 261.110 as it does to other similar statutes, a but-for standard providing that “the protected conduct ‘need to be the employer’s sole motivation’ for the adverse action ‘but it must be such that without’ the protected conduct the adverse action ‘would not have occurred when it did’”. The hospital argued that it conclusively proved that it terminated Thompson because she disclosed protected health information without authorization in violation of hospital policy. It had previously warned Thompson that such a violation would result in her termination, which it did. Thompson asserted that a form the hospital provided to her at the time of her termination indicated that the hospital knew about the CPS report, raising a fact issue as to the rationale and timing of her termination. The Court agreed with the hospital.

The Supreme Court reversed the court of appeals’ judgment and reinstated the summary judgment in the hospital’s favor. It held that the hospital’s evidence conclusively negated the “but for” causation element of the nurse’s claim because it demonstrated that the hospital would have fired the nurse when it did for her third violation of its policy, regardless of the CPS report. The nurse therefore could not establish a violation of Section 261.110, and summary judgment in favor of the hospital was proper.

If you should have any questions about these opinions, please contact the attorneys in our Austin or Dallas offices at info@gstexlaw.com.

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