Johnson v. Crown Enterprises, Inc.

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT January 21, 2005
_______________________
Charles R. Fulbruge III
No. 03-31083 Clerk
_______________________

JOHNNY L. JOHNSON,

Plaintiff-Appellant,

v.

CROWN ENTERPRISES, INC.; DIXIE HARVESTING COMPANY AND CORA-TEXAS
MANUFACTURING COMPANY,

Defendants-Appellees.

_______________________

Appeal from the United States District Court
for the Middle District of Louisiana
_______________________

Before REAVLEY, BENAVIDES and PRADO, Circuit Judges.

EDWARD C. PRADO, Circuit Judge:

Johnny Johnson appeals from the district court’s

determination that his racial discrimination claim was time-

barred. Because we conclude that his claim related back to the

filing of his original petition, we reverse this part of the

judgment. Johnson also contends that the district court

improperly found that a parent company and its subsidiary, the

company for which Johnson worked, were not a single enterprise.

On this point, we agree with the district court and so affirm

that portion of its judgment.

Johnson hauled sugar cane as a truck driver for Appellee

Dixie Harvesting Company. This work was seasonal, lasting the

1
five months of the sugar cane harvest each year. Johnson hauled

sugar during the 1998–1999 harvest season and again during the

1999–2000 season. Although Johnson’s original pleadings claimed

that he was an employee, the parties now agree that he was, in

fact, an independent contractor.

During the second season, Johnson, who is African-American,

alleges that he overheard Kevin Medine, the Dixie employee in

charge of hiring, telling three white men, “Man, I’m sick of

these damn n******’ trucks breaking down. I’m gonna stop hiring

these n****** and hire some of my buddies with them good trucks

where this damn cane can get hauled to the mill.”

Following this, Johnson was not rehired for the 2000-2001

season, nor for any season after that. Johnson alleges that

sixteen other African-American truckers’ contracts also were not

renewed for the 2000-2001 season, although the other truckers’

claims are not part of this lawsuit. Johnson also alleges that

Dixie hired thirteen new truckers for the 2000-2001 season and

that all of these truckers were white.

Johnson filed a charge of discrimination with the EEOC and,

after receiving a right-to-sue letter, sued Dixie and two

companies that Johnson alleged were interrelated with Dixie——

Crown Enterprises, Inc., and Cora-Texas Manufacturing Company.

Johnson originally sued under Title VII, contending that he was a

“contract employee” of Dixie. After some delay, Dixie filed its

answer, denying liability in part because Johnson was an

2
independent contractor, not an employee, and thus excluded from

Title VII’s protection. Johnson moved to amend his complaint to

add a claim for racial discrimination under 42 U.S.C. § 1981,

which does not require the plaintiff to be an employee. The

magistrate judge granted this motion. Although they had opposed

the motion to amend, Dixie and the other defendants never filed

an objection to the magistrate judge’s ruling. Dixie, Crown, and

Cora-Texas then moved for summary judgment, arguing among other

things that the limitations period had run on Johnson’s § 1981

claims and that Dixie and Crown did not form a single enterprise.

The district court granted Dixie’s motion for summary

judgment. The court found that Johnson’s § 1981 claims were

barred by limitations, that he could not establish a Title VII

claim because he was not an employee,1 and that Crown and Cora-

Texas were not part of a single enterprise with Dixie. This

appeal followed.

Standard of Review

We review the district court’s summary judgment decision de

novo. Am. Home Assurance Co. v. United Space Alliance, LLC, 378

F.3d 482, 486 (5th Cir. 2004). In reviewing this decision, we

use the same standards as the district court. Pegram v.

Honeywell, Inc., 361 F.3d 272, 278 (5th Cir. 2004). In other

1
Johnson now concedes that he cannot proceed on his Title
VII claim and admits that he was not, in fact, an employee.

3
words, we ask whether the movant has shown the nonexistence of

any genuine issues of material fact and that he is entitled to

judgment as a matter of law. FED. R. CIV. P. 56(c).

Limitations Period

Section 1981 does not contain a limitations period. For

claims under this section, courts have traditionally applied the

relevant state personal injury limitations period. Goodman v.

Lukens Steel Co., 482 U.S. 656, 661–62 (1987). In this case,

that would be Louisiana’s one-year prescriptive period for tort

actions. See Taylor v. Bunge Corp., 775 F.2d 617, 618 (5th Cir.

1985). Although Johnson’s original complaint was filed within

this period, limitations had run by the time that Johnson made a

§ 1981 claim in his amended complaint.

In his reply brief, however, Johnson argues that the one-

year period does not apply, based on an intervening Supreme Court

case, Jones v. R. R. Donnelley & Sons Co., 541 U.S. 369, 124 S.

Ct. 1836 (2004). Jones provides that claims under the 1991

revisions to § 1981 have a four-year limitations period. Jones,

124 S. Ct at 1845-46. The 1991 revisions allow a plaintiff to

sue for conduct, such as harassment or termination, that occurs

after contract formation.

We believe, however, that Johnson is not suing the Appellees

for conduct occurring after contract formation, but rather for

failure to enter into a new contract with him. His brief clearly

4
indicates that his claim is not based on termination, even

stating that “[t]here was no termination involved in the present

case.” Thus, Jones does not alter the limitations period for

Johnson’s § 1981 claim.

Relation Back

Given the one-year limitations period, Johnson contends that

the district court erred in concluding that the § 1981 claim in

his amended complaint did not relate back to the date of his

original complaint, which was filed within the one-year period.

Federal Rule of Civil Procedure 15(c) provides that, in

certain circumstances, amendments to pleadings relate back to the

date of the original pleading. One of those circumstances is

when “the claim or defense asserted in the amended pleading arose

out of the conduct, transaction, or occurrence set forth or

attempted to be set forth in the original pleading.” FED. R. CIV.

P. 15(c)(2). Thus, the focus is “not . . . the caption given a

particular cause of action, but . . . the underlying facts upon

which the cause of action is based.” Watkins v. Lujan, 922 F.2d

261, 265 (5th Cir. 1991). “The purpose of the rule is

accomplished if the initial complaint gives the defendant fair

notice that litigation is arising out of a specific factual

situation.” Longbottom v. Swaby, 397 F.2d 45, 48 (5th Cir.

1968).

The district court concluded that Johnson’s amended pleading

5
did not meet this requirement because “the Title VII claim and

the § 1981 claim are two separate and distinct claims that have

different elements of proof and different procedural requirements

regarding exhaustion of remedies and time limitations.” This

analysis does not follow Rule 15(c), which asks whether the new

claim arose out of the same conduct, transaction, or occurrence

as the originally-pleaded one. Although the elements of proof

might be relevant to the decision,2 whether the claims involve

the same conduct, transaction, or occurrence remains the central

issue.

Moreover, several Fifth Circuit cases contradict the

district court’s rigid distinction between Title VII and § 1981

claims. For example, in Watkins, the court held that the

plaintiff’s Title VII allegation related back to her earlier

barred § 1981 pleading “because both causes of action were based

upon the same facts and allegations of discrimination.” 922 F.2d

at 265. Similarly, in Caldwell v. Martin Marietta Corp., 632

F.2d 1184, 1187 (5th Cir. Unit B 1980), the court determined that

a new Title VII claim related back to the date that the plaintiff

originally filed his § 1981 complaint. Although neither of these

cases involved the issue of employee status, each is contrary to

2
See 3 MOORE’S FEDERAL PRACTICE § 15.19[2] at 15-83 (stating
that one relevant factor is “[w]hether the plaintiff will rely on
the same kind of evidence offered in support of the original
claim to prove the new claim”).

6
the district court’s conclusion that the two claims are

inherently different.

Johnson’s § 1981 claims arise from the same conduct,

transaction, or occurrence as his Title VII claims do. The two

claims are based on identical allegations of discrimination; both

are based on the hiring decisions made after Medine’s comments.

The only real difference between the claims is in the

characterization of Johnson’s status as an independent contractor

or as an employee. Thus, the district court erred in concluding

that Johnson’s claims did not relate back under Rule 15.3

Johnson’s claims are not barred by limitations.

Single Enterprise

Johnson further argues that the district court should have

concluded that a fact question existed concerning whether Dixie

3
Johnson’s original Title VII claims may have had a
jurisdictional defect because it appears that Dixie did not have
enough employees to satisfy the statute’s definition of
“employer.” See Arbaugh v. Y&H Corp., 380 F.3d 219, 224-25 (5th
Cir. 2004) (reiterating that failure to meet Title VII’s employee
count requirement deprives the court of jurisdiction). The
relation back of Johnson’s § 1981 claim cures this problem, as
well. In Sessions v. Rusk State Hospital, we described this
cure:
A complaint that is defective because it does not allege
a claim within the subject matter jurisdiction of a
federal court may be amended to state a different claim
over which the federal court has jurisdiction. If the
claim asserted in the amendment arises out of the conduct
or occurrence set forth in the original complaint, the
amendment is given retroactive effect to the date the
original complaint was filed.
648 F.2d 1066, 1070 (5th Cir. 1981)(citations omitted).

7
and Crown formed a single enterprise. If the two formed a single

enterprise, Johnson contends, Crown would be liable for Dixie’s

actions. Johnson’s argument is based on the Supreme Court’s

Radio Union test for determining a single enterprise under the

Fair Labor Standards Act.4 He argues that this single enterprise

test, which this circuit has applied in Title VII and other

employment discrimination cases, should also apply to § 1981

cases.

This circuit first applied the four-factor single enterprise

test to determine whether two entities served as a single

employer for Title VII purposes in Trevino v. Celanese Corp., 701

F.2d 397 (5th Cir. 1983). The four relevant factors are “(1)

interrelation of operations, (2) centralized control of labor

relations, (3) common management, and (4) common ownership or

financial control.” Trevino, 701 F.2d at 404. The second factor

has been refined into an inquiry about “[w]hat entity made the

final decisions regarding employment matters related to the

person claiming discrimination?” Id. (quoting Odriozola v.

Superior Cosmetic Distribs., Inc., 531 F. Supp. 1070, 1076

(D.P.R. 1982)). This factor, furthermore, has been called the

most important one. Schweitzer v. Advanced Telemarketing Corp.,

104 F.3d 761, 764 (5th Cir. 1997). But see Carpenter Local Union

4
The Court articulated this test in Radio & Television
Broadcast Technicians Local Union 1264 v. Broadcast Service of
Mobile, Inc., 380 U.S. 255, 256 (1965).

8
No. 846 of United Brotherhood of Carpenters v. Pratt-Farnsworth,

Inc., 690 F.2d 489, 505 (5th Cir. 1982) (“[N]o one of the factors

is controlling . . . nor need all criteria be present.”)(citation

omitted).

Assuming that the Trevino test applies, Johnson seems to

have presented evidence of the interrelation of operations and,

to a lesser extent, common management. Crown and Dixie operate

from the same building, and Dixie uses Crown for secretarial

support and supplies, such as copiers and paper. Crown does not

appear to separately account for the time its employees spend

doing administrative work for Dixie. Further, Crown’s personnel

director, Louis Jordan, responded to Johnson’s EEOC charge.

Jordan also testified that any Dixie contractor could have gone

to him with any complaints about the nonrenewal of a contract

with Dixie.

As for common ownership or financial control, both

corporations were formed and originally owned by one person, Ross

Campesi, Sr. Campesi transferred ownership of Crown to one son,

Ross Campesi, Jr., and transferred Dixie to another son, Michael

Campesi. There is, therefore, a history of common ownership and

current family ownership.5

5
In a different context, we have cited with approval cases
indicating that family ownership is common ownership. J. Vallery
Elec., Inc. v. NLRB, 337 F.3d 446, 451 n.16 (5th Cir. 2003)
(conducting an alter ego analysis)(citing NLRB v. Dane County
Dairy, 795 F.2d 1313, 1322 (7th Cir. 1986); Goodman Piping

9
 Yet Johnson fails to present any evidence that Crown

actually made any of Dixie’s labor decisions, including decisions

regarding the renewal of the driver contracts. The district

court concluded that, because this factor was the most important,

Crown was entitled to summary judgment despite the existence of

some other evidence suggesting that the two might be a single

enterprise. We agree. In this case, the other evidence cannot

override Crown’s lack of involvement with Dixie’s personnel

decisions. Because Johnson has not presented evidence to

establish a fact question concerning whether Dixie and Crown form

a single enterprise, summary judgment on this point was

appropriate.

Appellees’ Other Arguments

Appellees also raise other issues, all of which can be

quickly resolved. First, they argue that Johnson’s amended

complaint was never served in compliance with Federal Rule of

Civil Procedure 4. However, Rule 4 does not apply because

Federal Rule of Civil Procedure 5, not Rule 4, governs service of

“every pleading subsequent to the original complaint.” Rule 5(b)

provides for service by delivery, mail, leaving a copy with the

clerk (if no address is available), or by any other means agreed

to in writing by the party being served. What is served in this

Products, Inc. v. NLRB, 741 F.2d 10, 11-12 (2d Cir. 1984); J.M.
Tanaka Constr., Inc. v. NLRB, 675 F.2d 1029, 1035 (9th Cir.
1982).

10
case is the pleading, motion, or other paper, not a summons. See

FED. R. CIV. P. 5(a).

Appellees also argue that the magistrate judge should not

have granted Johnson’s request to file an amended complaint

because it was untimely. Appellees have not advanced any

specific argument for why the decision to permit Johnson to amend

his pleading was an abuse of discretion.6 We see nothing to

suggest that it was.

Finally, Appellees argue that Johnson’s § 1981 claim is

barred by laches. “To establish that a cause of action is barred

by laches, ‘the defendant must show (1) a delay in asserting the

right or claim; (2) that the delay was not excusable; and (3)

that there was undue prejudice to the defendant.’” Goodman v.

Lee, 78 F.3d 1007, 1014 (5th Cir. 1996) (quoting Geyen v. Marsh,

775 F.2d 1303, 1310 (5th Cir. 1985)). Here, Appellees fail to

present any caselaw or detailed argument in support of this

contention. All that they argue is that Johnson waited too long.

This argument does not satisfy their burden.

Conclusion

The judgment dismissing the U.S.C. § 1981 claim against

Crown Enterprises, Inc. is reversed. The judgment is otherwise

6
“[T]he decision to grant or to deny a motion for leave to
amend lies within the sound discretion of the trial court.”
Addington v. Farmer’s Elevator Mut. Ins. Co., 650 F.2d 663, 666
(5th Cir. 1981).

11
affirmed. The case is remanded for resolution of the claim

against Crown Enterprises.

AFFIMRED in Part and REVERSED in Part, and REMANDED.

12