GWENDOLYN M. DANIEL, Plaintiff - Appellant v. UNIVERSITY OF TEXAS SOUTHWESTERN MEDICAL CENTER, Defendant - Appellee
No. 19-10834
United States Court of Appeals, Fifth Circuit
June 2, 2020
Before WIENER, STEWART, and WILLETT, Circuit Judges.
Plaintiff-Appellant Gwendolyn M. Daniel filed an Americans with Disabilities Act (ADA) action against Appellee-Defendant University of Texas Southwestern Medical Center (UTSMC). She is seeking recovery for UTSMC‘s alleged discrimination and retaliation against her in connection with her employment as a UTSMC nurse.
The district court granted UTSMC‘s
I.
UTSMC is a public medical institution within the University of Texas System (UT System)1 and the largest medical center in the Dallas metropolitan area. UTSMC is comprised of UT Southwestern Medical School, UT Southwestern Graduate School of Biomedical Sciences, and UT Southwestern School of Health Professions. UTSMC is also affiliated with several healthcare facilities, including but not limited to Parkland Memorial Hospital, William P. Clements Jr. University Hospital, and, as relevant in this case, Saint Paul University Hospital.2
Plaintiff was employed at Saint Paul as a contract registered nurse and subsequently elevated to a full-time nurse. Plaintiff alleges that due to her ADA-qualified disability, UTSMC subjected her to continual harassment, discipline, discrimination, retaliation, and constructive discharge.
In July 2018, Plaintiff initiated this action against UTSMC seeking economic and equitable relief for ADA retaliation and discrimination.3 UTSMC moved for
Plaintiff subsequently moved for reconsideration which the district court denied.
Plaintiff now appeals the dismissal order granting UTSMC‘s
II.
We review questions of subject matter jurisdiction, including sovereign immunity determinations, de novo. See Machete Prods., LLC v. Page, 809 F.3d 281, 287 (5th Cir. 2015).
“[P]laintiff bears the burden of proof that jurisdiction does in fact exist.” Ramming v. United States, 281 F.3d 158, 161 (5th Cir. 2001). In evaluating a
III.
Pursuant to the Eleventh Amendment, a state‘s sovereign immunity in federal court extends to private suits against state agencies, state departments, and other arms of the state. See P.R. Aqueduct & Sewer Auth. v. Metcalf & Eddy, Inc., 506 U.S. 139, 146 (1993); Richardson v. S. Univ., 118 F.3d 450, 452–54 (5th Cir. 1997) (stating that sovereign immunity protects “arms of the state“). “While instrumentalities of the state enjoy sovereign immunity, ‘the Eleventh Amendment does not extend its immunity to units of local government.‘” Providence Behavioral Health v. Grant Rd. Pub. Util. Dist., 902 F.3d 448, 456 (5th Cir. 2018) (quoting Bd. of Trustees of Univ. of Ala. v. Garrett, 531 U.S. 356, 369 (2001)). Said differently, not all units of a state government are immunized from federal action.
To determine whether a unit qualifies as an arm of the state as a matter of law,4 “we employ the six-factor test developed in Clark v. Tarrant County, Tex., 798 F.2d 736 (5th Cir. 1986).” Providence, 902 F.3d at 456. The six Clark factors are:
- Whether the state statutes and case law view the agency as an arm of the state;
- The source of the entity‘s funding;
- The entity‘s degree of local autonomy;
- Whether the entity is concerned primarily with local as opposed to statewide, problems;
- Whether the entity has the authority to sue and be sued in its own name; and
-
Whether the entity has the right to hold and use property.
See Hudson v. City of New Orleans, 174 F.3d 677, 681 (5th Cir. 1999) (citing Clark, 798 F.2d at 744-45). An underlying goal of this six-factor test is to protect state funding; in turn, the second factor is the most important. Id. at 682. Each factor need not be present for state immunity to be extended. See id.
In employing the Clark factors,5 we conclude that UTSMC is entitled to arm-of-the-state status; therefore, it has sovereign immunity from Plaintiff‘s ADA discrimination and retaliation claims.
Factor 1 (Statutory and Legal Authorities). UTSMC is part of the UT System. See
We have held that public universities are entitled to sovereign immunity as arms of the state. See U.S. Oil Recovery Site PRP Grp. v. R.R. Comm‘n of Tex., 898 F.3d 497, 501–02 (5th Cir. 2018) (collecting cases). In several unpublished opinions, we have likewise consistently treated health institutions of the UT System, including UTSMC, as instrumentalities of the State of Texas. See, e.g., Elhaj-Chehade v. Office of Chief Admin. Hearing Officer, 235 F.3d 1339 (Table), 2000 WL 1672679, at *1 (5th Cir. 2000) (holding that UTSMC “is an arm of the State“); U.S. ex rel. King v. Univ. of Tex. Health Sci. Ctr. at Hous., 544 F. App‘x 490, 495–98 (5th Cir. 2013) (per curiam) (holding that the medical institution is an arm of state); Sullivan v. Univ. of Tex. Health Sci. Ctr. at Hous. Dental Branch, 217 F. App‘x 391, 392 (5th Cir. 2007) (per curiam) (“It is undisputed that UTHSC, as an arm of the state, is entitled to Eleventh Amendment immunity.“); Scott v. Pfizer Inc., 182 F. App‘x 312, 315-16 (5th Cir. 2006) (per curiam) (same with regard to University of Texas Medical Branch).
These statutes and legal authorities favor treating UTSMC as an arm of Texas.
Factor 2 (Source of State Funding). In evaluating the second and most significant factor, we analyze “whether a judgment against [UTSMC] will be paid with state funds.” Richardson, 118 F.3d at 455. Texas law authorizes state treasury funds to be allocated to UTSMC from the permanent health fund for higher education. See
A similar contention was posed to us in United Carolina Bank v. Board of Regents of Stephen F. Austin State University, 665 F.2d 553, 560 (5th Cir. Unit A 1982). There, the district court held that the university was not entitled to Eleventh Amendment protection because a judgment award did not implicate general revenues of the state, as there were identifiable revenue bonds available for a judgment payout. Id. (The entity “could itself pay such an award because it had substantial unappropriated, separately held, locally generated funds.“). But “[t]he key is not the ability to identify segregated funds“; rather, it is whether use of these unappropriated funds to pay a damage award against [the university] would interfere with the fiscal autonomy and political sovereignty of Texas.” Id. at 560-61. Because the university also held funds in the state treasury and the funds were otherwise restricted from use, we reversed the district court‘s holding, refrained from segregating identifiable funds, and extended sovereign immunity to the university. Id. at 561 (stating that “any award from those funds would directly interfere with the state‘s fiscal autonomy“).
We see no reason to veer from United Carolina Bank‘s reasoning, and in turn, we reject Plaintiff‘s segregation argument. Furthermore, Plaintiff‘s record support—which essentially relies on an isolated sentence that UTSMC clinical facilities are privately funded—does not verify whether a judgment against UTSMC would be satisfied with private or state-allocated funds. To be clear, we do not draw a bright-line rule as to the amount of private funding necessary to hold an entity financially independent from the state. Plaintiff‘s burden is to demonstrate (via evidentiary support) that UTSMC will be responsible for its judgment and debts, not the state. Cf. U.S. ex rel. Barron v. Deloitte & Touche, L.L.P., 381 F.3d 438, 440 (5th Cir. 2004) (noting that the contractual terms dictate that the state not be responsible for any of the entity‘s debts and that the state be indemnified from any liability). She failed to satisfy her burden in that respect. Thus, we conclude that a subsequent judgment against UTSMC would interfere with Texas‘s fiscal autonomy.
Accordingly, this factor—which is the “most significant“—supports a finding that UTSMC is an arm of the State of Texas.
Factor 3 (Local Autonomy). As a component institution of the UT System, UTSMC is governed by a board of regents “appointed by the governor with the advice and consent of the senate.”
Considering the state oversight and financial regulation, UTSMC does not operate with a level of “local autonomy” to consider it independent from Texas. This factor supports UTSMC receiving arm-of-the-state recognition.
Factor 4 (Concerned with Local or State Issues). Plaintiff‘s position is that because UTSMC‘s facilities are only in Dallas, UTSMC‘s concerns should be considered local. By Plaintiff‘s logic, an entity‘s concerns are limited to the location of its office. This line of reasoning is flawed.
In King, an identical “lack of statewide presence” argument was presented regarding a medical unit of the UT System, but we refrained from isolating the institution from the UT System in our Clark analysis. 544 F. App‘x at 498. Instead, we evaluated the UT System as a whole. Id. (stating that the UT System‘s “locations throughout the state of Texas,” “[e]ducation and research” were statewide concerns) (quoting
Factor 5 (Ability to be Sued or Sue). This factor bears a different result than the previous factors. Here, we evaluate whether the entity may sue and be sued in its own name. Texas law gives the UT System the authority to sue on its own behalf and/or UTSMC‘s behalf. See
Factor 6 (Use of Property). Lastly, Plaintiff claims that UTSMC operates its two hospitals without state control over its property management. Id. at 20. We disagree.
“The board of regents of the University of Texas System has the sole and exclusive management and control of the lands set aside and appropriated to, or acquired by, The University of Texas System.”
These characteristics evince UTSMC does not exclusively manage the use of its property. Consequently, this Clark factor supports a finding of UTSMC as an arm of the state.
IV.
In sum, five out of the six Clark factors, including the most important source-of-funding factor, counsel in favor of a finding that UTSMC is an instrumentality of the State of Texas. Accordingly, we hold that UTSMC is entitled to Eleventh Amendment protection,8 precluding our jurisdiction.
For the foregoing reasons, we AFFIRM the district court‘s dismissal of this action for lack of subject matter jurisdiction.