Case: 18-11092 Document: 00515212118 Page: 1 Date Filed: 11/25/2019
REVISED November 25, 2019
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
No. 18-11092 November 22, 2019
Lyle W. Cayce
Clerk
KATHIE CUTRER,
Plaintiff - Appellant,
v.
TARRANT COUNTY LOCAL WORKFORCE DEVELOPMENT BOARD,
doing business as Tarrant County Workforce Solutions;
INSPERITY INCORPORATED,
Defendants - Appellees.
Appeal from the United States District Court
for the Northern District of Texas
Before WIENER, GRAVES, and OLDHAM, Circuit Judges. *
ANDREW S. OLDHAM, Circuit Judge:
Kathie Cutrer worked for the Tarrant County Workforce Development
Board d/b/a “Workforce Solutions” for 17 years. Workforce Solutions fired
Cutrer six months before she would’ve been eligible for retirement. Cutrer sued
for discrimination. Workforce Solutions says it’s basically the State of Texas
and hence enjoys state sovereign immunity. We disagree.
* Judges Wiener and Graves concur in the judgment only.
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I.
The Texas Workforce Investment Act establishes a multi-tiered
workforce development system. See TEX. GOV’T CODE §§ 2308.001–.403; Arbor
E & T, LLC v. Lower Rio Grande Valley Workforce Dev. Bd., Inc., 476 S.W.3d
25, 31 (Tex. App.—Corpus Christi 2013, no pet.). The top tier is the Texas
Workforce Commission (“TWC”). TWC is “a state agency established to operate
an integrated workforce development system in [Texas] . . . and to administer
the unemployment compensation insurance program in [the] state.” TEX. LAB.
CODE § 301.001(a). The bottom tier is comprised of local workforce
development boards, like Workforce Solutions. Such local boards “plan and
oversee the delivery of workforce training and services,” and “evaluate
workforce development in [their respective] workforce development area[s].”
TEX. GOV’T CODE § 2308.253(a).
Under Texas law, the political leaders in a “workforce development area”
can agree to create a local workforce development board. See ibid. Here, the
“workforce development area” is Tarrant County, Texas. In 1996, three local
government leaders in Tarrant County—the mayor of Fort Worth, the mayor
of Arlington, and the county judge of Tarrant 1—agreed to create such a board.
Today, that board does business as “Workforce Solutions.” All or almost all of
Workforce Solutions’ employees are co-employed by a for-profit company called
Insperity, Inc.
1 The position of county judge is a remnant of Texas’s time as part of Mexico. Title II,
Section VII of the 1827 Constitution of the State of Coahuila and Texas established
Ayuntamientos (town councils), charged with municipal administration. And under Article
159 of the 1827 Constitution, the council was to include “Alcades.” “Alcade” is a Spanish term
for a magistrate who performs both executive and judicial functions. Today, the county judge
principally serves as the chief executive of a Texas county. See TEX. CONST. art. V, §§ 16, 18.
But in keeping with the historical pedigree of the office, a county judge still performs some
judicial functions. See, e.g., TEX. EST. CODE § 1002.008(a)(1); TEX. HEALTH & SAFETY CODE
§§ 571.012, 573.012.
2
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Workforce Solutions hired Cutrer on May 29, 2000. (It is unclear from
the record whether Cutrer was co-employed by Insperity.) Sometime around
August 22, 2000, Cutrer was injured in a car accident. Those injuries included
a broken neck, which required multiple surgeries and a double spinal fusion.
For a time, Workforce Solutions accommodated Cutrer’s well-documented
disabilities. It stopped doing so in 2016. The same year, Workforce Solutions
and Cutrer’s supervisor allegedly engaged in various acts of discrimination.
Then Workforce Solutions fired Cutrer. The parties agreed in writing to
settle Cutrer’s various complaints for $33,750. But, adding insult to injury,
Workforce Solutions reneged on the settlement agreement, retroactively
changed Cutrer’s employment status from “voluntary termination” to
“termination for poor job performance,” and used her personal information in
violation of the Fair Credit Reporting Act (“FCRA”).
Cutrer sued both Workforce Solutions and Insperity for discrimination,
retaliation, post-employment retaliation under the Americans with
Disabilities Act (“ADA”), and for violations of the FCRA. Workforce Solutions
moved to dismiss under Federal Rule of Civil Procedure 12(b)(1) on the ground
that it enjoys “sovereign immunity.” The district court granted the motion.
Cutrer timely appealed. 2
II.
Sovereign immunity has ancient origins. It dates at least as far back as
Bracton in the thirteenth century. See, e.g., 2 BRACTON, DE LEGIBUS ET
CONSUETUDINIBUS ANGLIAE 33 (George Woodbine ed., Samuel Thorne trans.
2 The district court also granted Insperity’s motion to dismiss under Rule 12(b)(6).
Cutrer’s opening brief says nothing about Insperity. So her claims against Insperity are
forfeited. See United States v. Thibodeaux, 211 F.3d 910, 912 (5th Cir. 2000) (“It has long
been the rule in this circuit that any issues not briefed on appeal are [forfeited].”); see also
Melton v. Teachers Ins. & Annuity Ass’n of Am., 114 F.3d 557, 561 (5th Cir. 1997). We address
only her claims against Workforce Solutions.
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1968) (London 1569 ed., folio 5b, Bk. I, ch. 8); Louis L. Jaffe, Suits Against
Governments and Officers: Sovereign Immunity, 77 HARV. L. REV. 1, 2 (1963)
(“By the time of Bracton (1268) it was settled doctrine that the King could not
be sued eo nomine in his own courts.”). And it derives from the sovereignty of
the King: “[T]he law ascribes to the king the attribute of sovereignty, or pre-
eminence,” which means he is “accountable to no man,” and “no suit or action
can be brought against [him], even in civil matters, because no court can have
jurisdiction over him.” 1 WILLIAM BLACKSTONE, COMMENTARIES *241–42; see
also RICHARD H. FALLON, JR. ET AL., HART & WECHSLER’S THE FEDERAL
COURTS AND THE FEDERAL SYSTEM 877–80 (7th ed. 2015) [hereinafter HART &
WECHSLER].
At our Nation’s Founding, one of the Anti-Federalists’ concerns was
whether the States would enjoy sovereign immunity in the new Article III
courts. The States were laboring under more than $200 million in
Revolutionary War debt. That made the Anti-Federalists worry that the State-
Citizen Clause in Article III, § 2 would allow out-of-state citizens to use the
federal courts to sue States and collect the debts. For example, Brutus said the
State-Citizen Clause was “improper, because it subjects a state to answer in a
court of law, to the suit of an individual.” Brutus XIII (Feb. 21, 1788), in 2 THE
COMPLETE ANTI-FEDERALIST 429 (Herbert Storing ed. 1981). Federal Farmer
was blunter:
How far it may be proper to admit a foreigner or the citizen of
another state to bring actions against state governments, which
have failed in performing so many promises made during the war,
is doubtful: How far it may be proper so to humble a state, as to
bring it to answer to an individual in a court of law, is worthy of
consideration; the states are now subject to no such actions, and
this new jurisdiction will subject the states, and many defendants
to actions, and processes, which were not in the contemplation of
the parties, when the contract was made; all engagements existing
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between . . . states and citizens of other states were made [with]
the parties contemplating the remedies then existing on the laws
of the states—and the new remedy proposed to be given in the
federal courts, can be founded on no principle whatever.
Letters from the Federal Farmer III (Oct. 10, 1787), in 2 THE COMPLETE ANTI-
FEDERALIST, supra, at 245.
As with so many of the Anti-Federalists’ concerns, Hamilton tried to
dismiss this one as “a supposition which has excited some alarm upon very
mistaken grounds.” THE FEDERALIST NO. 81, at 487 (Alexander Hamilton)
(Clinton Rossiter ed., 1961). And Hamilton insisted the federal courts wouldn’t
dare entertain individuals’ suits against the States: “It is inherent in the
nature of [a State’s] sovereignty not to be amenable to the suit of an individual
without its consent.” Ibid. It took less than five years to prove Hamilton wrong.
See Chisholm v. Georgia, 2 U.S. (2 Dall.) 419 (1793).
That’s how we got the Eleventh Amendment. Principality of Monaco v.
Mississippi, 292 U.S. 313, 325 (1934) (noting the Chisholm “decision created
such a shock of surprise that the Eleventh Amendment was at once proposed
and adopted”). That Amendment prohibits an individual from suing a foreign
state in federal court (as Chisholm had). Shortly after Congress gave the courts
federal question jurisdiction in 1875, the Supreme Court held that sovereign
immunity also prohibits an individual from suing his home state in federal
court. See Hans v. Louisiana, 134 U.S. 1 (1890). From Hans to today, the
Supreme Court has extended a broad host of immunities to States haled into
federal court. See, e.g., Seminole Tribe of Fla. v. Florida, 517 U.S. 44, 67–72
(1996); Monaco, 292 U.S. at 329–30. 3
3 The text of the Eleventh Amendment provides: “The Judicial power of the United States
shall not be construed to extend to any suit in law or equity, commenced or prosecuted against
one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign
State.” U.S. CONST. amend XI. That text says nothing about a suit brought by a citizen
against her home state. See, e.g., William Baude, Sovereign Immunity and the Constitutional
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But on the very same day the Court decided the canonical Hans case, it
emphasized that state sovereign immunity does not protect a political
subdivision of the State. See Lincoln County v. Luning, 133 U.S. 529 (1890). In
that case, a federal court rendered judgment against a county and forced it to
honor certain bonds and coupons. That’s the very thing Brutus and Federal
Farmer worried federal courts would do to States under Article III. But Lincoln
County held that only the State is immune from suit in federal court:
[W]hile the county is territorially a part of the state, yet politically
it is also a corporation created by, and with such powers as are
given to it by, the state. In this respect, it is a part of the state only
in that remote sense in which any city, town, or other municipal
corporation may be said to be a part of the state.
Id. at 530. The same rule has endured ever since. See HART & WECHSLER,
supra, at 921.
Lincoln County makes this an open-and-shut case: Because Tarrant
County, the City of Arlington, and the City of Fort Worth are not the State of
Texas, they obviously cannot confer the State’s sovereign immunity upon a
board by interlocal agreement. They can’t give what they don’t have.
III.
Workforce Solutions nonetheless insists it should be treated like the
sovereign State of Texas—even though it’s in no sense the sovereign. It rests
Text, 103 VA. L. REV. 1, 6–7 (2017); John F. Manning, The Eleventh Amendment and the
Reading of Precise Constitutional Texts, 133 YALE L.J. 1663, 1666 (2004). But a long line of
precedent holds that “the Eleventh Amendment accomplished much more: It repudiated the
central premise of Chisholm that the jurisdictional heads of Article III superseded the
sovereign immunity that the States possessed before entering the Union.” College Sav. Bank
v. Fla. Prepaid Postsecondary Educ. Expense Bd., 527 U.S. 666, 669 (1999); see also Alden v.
Maine, 527 U.S. 706, 736 (1999) (“[T]he bare text of the Amendment is not an exhaustive
description of the States’ constitutional immunity from suit.”). That immunity extends to
States haled into state courts, see Alden, 527 U.S. at 759–60, and federal non-courts (like
administrative agencies), see Fed. Mar. Comm’n v. S.C. State Ports Auth., 535 U.S. 743, 747
(2002).
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that counterintuitive argument on the so-called “Clark factors,” which derive
from our decision in Clark v. Tarrant County, 798 F.2d 736 (5th Cir. 1986).
Here too Workforce Solutions falls far short.
In Clark, we held that sovereign immunity applies not only to the State
itself but also to “an arm of the state.” Id. at 744. Then we identified six
“factors” that influence our determination of whether something is an “arm of
the state.” Ibid. Those “factors” are:
(1) “whether the state statutes and case law view the [entity] as an
arm of the state”;
(2) “the source of the entity’s funding, since an important goal of
the Eleventh Amendment is the protection of state treasuries”;
(3) “the entity’s degree of local autonomy”;
(4) “whether the entity is concerned primarily with local, as
opposed to statewide, problems”;
(5) “whether the entity has the authority to sue and be sued in its
own name”; and
(6) “whether [the entity] has the right to hold and use property.”
Id. at 744–45. No factor or combination of them is necessary. None is sufficient.
And Clark says nothing about how to “balance” them. As Justice Scalia once
pointed out in similar circumstances, “the scale analogy is not really
appropriate, since the interests on both sides are incommensurate. It is more
like judging whether a particular line is longer than a particular rock is heavy.”
Bendix Autolite Corp. v. Midwesco Enters., Inc., 486 U.S. 888, 897 (1988)
(Scalia, J., concurring in judgment). Such “tests” have all the precision of a
blunderbuss.
Still, we’ve made two things clear. First, an entity that asserts sovereign
immunity under Clark bears the burden of demonstrating that it’s an “arm of
the state.” See, e.g., Skelton v. Camp, 234 F.3d 292, 297 (5th Cir. 2000)
(collecting cases). And second, Clark’s money factor deserves “the most
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weight.” Black v. N. Panola Sch. Dist., 461 F.3d 584, 596 (5th Cir. 2006). So
we’ve given Workforce Solutions multiple opportunities to carry its burden. 4
And we’ve endeavored at length to identify where Workforce Solutions would
get the money to pay an adverse judgment in this case. That endeavor has been
frustrating, to put it mildly.
In its brief on the merits, Workforce Solutions insists it is “wholly
dependent on public funding.” But it doesn’t specify that “public funding”
means state funds (as opposed to, say, local funds). And Workforce Solutions’
annual report suggests it receives $486,185 in “Other Fund Sources” that are
not tethered to any public fisc (federal, state, or local).
Workforce Solutions also relies upon a declaration from its general
counsel. The declaration says: “Any judgment against Workforce Solutions
could put funds from the state treasury at risk.” That’s a bold claim. And you
might wonder how or why it’s true. Unfortunately, the general counsel does
not elaborate. And it’s not self-evident from the record how or why a judgment
against a local board formed by interlocal agreement could or would be passed
through to the State. Workforce Solutions concedes the State appropriates zero
dollars directly to it or any other local development board. Workforce Solutions
4 Workforce Solutions moved to dismiss Cutrer’s complaint for lack of subject-matter
jurisdiction under Federal Rule of Civil Procedure 12(b)(1), and it contends Cutrer bears the
burden of proving Workforce Solutions is not entitled to sovereign immunity. It’s unclear
whether and to what extent the Eleventh Amendment deprives a federal court of subject-
matter jurisdiction to hear a case that arises under a federal statute. Compare Caleb Nelson,
Sovereign Immunity as a Doctrine of Personal Jurisdiction, 115 HARV. L. REV. 1559, 1615–
17 (2002) (arguing that the Eleventh Amendment deprives federal courts of subject-matter
jurisdiction only over diversity cases against States, and that sovereign immunity should be
available as a personal-jurisdiction defense in all other cases), with Lawrence C. Marshall,
Fighting the Words of the Eleventh Amendment, 102 HARV. L. REV. 1342, 1347 (1989) (arguing
that the Eleventh Amendment stripped the courts of the power to hear all suits between the
categories of parties listed in the Amendment, including those cases relying on federal-
question jurisdiction). Regardless of which party bears the burden, however, Workforce
Solutions is not entitled to sovereign immunity for the reasons explained below.
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does not identify a single instance in the past where the State appropriated
more than zero dollars to pay a judgment against a local board. Nor does
Workforce Solutions explain how or why the State would or could do so in the
future.
Given these ambiguities, we gave Workforce Solutions a final
opportunity to explain its avowed entitlement to sovereign immunity. After
argument, we asked for a supplemental brief explaining, inter alia, where
Workforce Solutions would get the money to pay a judgment for Cutrer.
Workforce Solutions filed a supplemental brief. But again, it raises more
questions than it answers. For example, Workforce Solutions says: “Potential
funding sources to pay an adverse judgment might include: A special
appropriation of the Texas Legislature; or Execution on the judgment by the
judgment-creditor-plaintiff on local bank accounts maintained by the Board.”
(emphases added). Might they include something else? What basis is there for
speculating that they include these two potentialities? Heaven only knows.
All of this is made more bewildering by the fact that Workforce Solutions
previously agreed in writing to pay Cutrer $33,750. Where did it plan to get
that money? If all of its money somehow really belongs to the State of Texas,
did the State have to agree to that payment? And regardless, what law would
give Workforce Solutions the power to move its purportedly public money from
the State treasury to Cutrer’s bank account in the absence of a judgment?
Again, Workforce Solutions won’t say. 5 “It is a riddle, wrapped in a mystery,
5 Workforce Solutions simply insists the State would, if necessary, readily pay a judgment
or settlement in this case. But, as far as we know, that’s not how Texas government works.
The General Appropriations Act requires every penny that leaves the State treasury to be
spent according to authorized purposes. See GENERAL APPROPRIATIONS ACT, 85th Leg., R.S.,
art. IX-1, § 1.01, Legislative Intent (“It is the purpose of the Legislature in enacting this bill
only to appropriate funds and to restrict and limit by its provisions the amount and conditions
under which the appropriations can be expended.”). Judgments and settlements are no
exception. See id., art. IX-77, § 16.04, Judgments and Settlements. For one, both the Governor
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inside an enigma.” Winston Churchill, The Russian Enigma (BBC Broadcast,
Oct. 1, 1939).
But when it comes to satisfying a burden of proof, enigmas won’t cut it.
A local board cannot invoke the ancient and august protections reserved to the
sovereign while steadfastly refusing to explain or identify how or why a money
judgment would in fact affect the sovereign. A party cannot carry its burden of
proof with equivocation and obfuscation.
* * *
Workforce Solutions is not the State of Texas. It’s a local board in Tarrant
County. We suppose it’s possible that judgments against such a local entity
could implicate the State’s treasury. But it’s not possible for such a local entity
to hide behind sovereign immunity when its briefs and the record reveal no
basis for it. If Workforce Solutions wants to be treated like the State of Texas,
it must explain why it is (for present purposes) the State of Texas.
The judgment of the district court is REVERSED, and the case is
REMANDED for further proceedings consistent with this opinion.
and the Attorney General must authorize the payment. Id. § 16.04(b)(1). And the Attorney
General must be satisfied that there was a valid “waiver of sovereign immunity or [a]
legislative resolution granting [the] litigant permission to sue.” Id. § 16.04(e)(8). We have no
evidence that the Attorney General approved the later-withdrawn settlement with Cutrer,
or that any state official thinks Workforce Solutions is entitled to pay its judgments with
appropriated funds. If there’s another way to pay the settlement with the State’s money,
again, Workforce Solutions doesn’t tell us.
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