Hines vs. Grand Casinos L L C, (5th Cir. 2002)

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IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

m 01-30692 Summary Calendar K ATY H INES , Plaintiff-Appellee, VERSUS G RAND C ASINOS OF L OUISIANA , LLC SS T UNICA -B ILOXI , Defendant-Appellant. Appeal from the United States District Court for the Western District of Louisiana January 4, 2002 Before J ONES , S MITH , and E MILIO M. G ARZA , Circuit Judges.

JERRY E. SMITH, Circuit Judge: * Grand Casinos of Louisiana, LLC (“Grand Casinos”), appeals a denial of its motion to dismiss Katy Hines’s title VII claims. Grand Casinos argues that the district court erred in concluding that Grand Ca sinos was Hines’s employ e r, in failing to join the Tunica-Biloxi Indian Tribe of Louisiana (“the Indian Tribe”) as a necessary and ind ispensable party under F ED . R. C IV . P. 19(a), and in failing to dismiss Hines’s claims because joinder of the Indian Tribe is not feasible under F E D . R. C IV . P. 19(b). Finding no error, we affirm.

I. Grand Casino Avoyelles is a gaming enterprise owned and o perat ed by the Indian * Pursuan t to 5 T H C IR . R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circum stances set forth in 5 T H C IR . R. 47.5.4. Tribe pursuant to the Indian Gaming Regulatory Act, 25 U.S.C. § 2703. The Indian Tribe entered into a Management and Construction Agreement ( “ the agreement”) with Grand Casinos. The agreement declared Grand Casinos solely responsible for “all business and affairs in co nnection with financing, construction, improvement, development, and day-to-day operation, management and maintena nce.” Grand Casinos was assigned “exclusive responsibility and auth orit y to direct the selection, control an d discharge of all personnel performing regular services for the Enterprise,” including the duty to perform background checks, draft personnel policies, design a job classification and sal a ry system, and establish an employee grievance procedure.

Grand Casino promised to provide a security force “comprised of secu rit y officers employed directly by the Tribe, or und e r a third party a nd t he Tribe, who shall report to the General Manager.” The General Manager is, in turn, selected by Grand Casinos and approved by a tribal representative. The agreement contradicts itself as to who employs the General Manager, first stating that Grand Casinos is the emplo yer, but fourteen pages later stating that the Tribe is. Hines worked as a security officer at Grand Casino Avoyelles. She alleges that her supervisor, Patrick Laborde, made inappropriate sexual remarks to her; when she complained, t he casino retaliated against her through more diffic u lt work assignments and a demotion. Consequently, she suffered medical problems, missed work, and was fired.

II. Hines filed a complaint wi th the Equal Emplo yment Opportunity Commissio n, received a right to sue letter, and sued Grand Casinos. Grand Casinos argued that it was not HinesÂ’s employer, so she had failed to state an essential element of her title VII claim under F ED . R. C IV . P. 12(b)(6). Grand Casinos also argued that the Indian Tribe was an indispensable party under rule 19(b), and thus HinesÂ’s failure to name the Indian Tribe as a defendant mandated dismissal under rule 12(b)(7). While this motion was pending, Hines filed employment discrimination claims against Grand Casinos and the Indian Tribe in tribal court.

The district court treated the motion to dismiss as a motion for summary judgment, which it denied. The district court and t his court granted leave to appeal the denial of the motion under 28 U.S.C. § 1292(b).

III. Grand Casinos argues that the Indian Tribe, not Grand Casinos, was HinesÂ’s employer, so the Indian the Tribe is an indispensable party.

F ED . R. C IV . P. 19(a). Because title VII does not apply to Indian tribes, 42 U.S.C. § 2000e, joinder of the Indian Tribe is not feasible and therefore, Grand Casinos argues, the suit should be dismissed. F E D . R. C IV . P. 12(b)(7), 19(b).

To determine whether a protected employment rela t io nship exists under Title VII, we apply the “hybrid” common law control/economic realities test. M ares v. Marsh , 777 F.2d 1066 (5th Cir. 1985). “The right to control an employee’s conduct is the most important component of this test.” 1 In evalu 1 Deal v. State Farm County Mut. Ins.

Co. , 5 F.3d 117, 119 (5th Cir. 1993); acco rd Fields v. Hallsville Indep. Sch. Dist. , 906 F.2d 1017, 1019 (continued...) ating this component, we look to who has the power to hire, fire, supervise, and set the work schedule for the employee. D eal , 5 F.3d at 119; Mares , 777 F.2d at 1068. The agreement is unambiguous; Grand Casinos has total , nearly exclusive authority over all perso nnel decisions. It hires and fires all regular employees; it alone designs the cas inoÂ’s personnel policies, job classification and sal a ry system, and employee grievance procedure; and it performs all employee background checks. The fact that the Indian Tribe preserved a veto power over other hiring d eci sions and imposed an Indian-preference requirement for hiring does not alter our conclusion. S ee Fields , 906 F.2d at 1020; Mares , 777 F.2d at 1068.

The Indi an Tribe did pay HinesÂ’s salary, withhold her taxes, and pro v ide her benefits, sat isfying the economic realities component of this test. See Deal , 5. F.3d at 119. The common law control component is the crucial facto r, however; the economic component is secondary. Thus, where one party exercises total control o ver hiring, firing, and supervising an employee, it must be the employer under title VII, regardless of whether a different party exercises economic control.

Accordingly, the district court was correct to conclude that Grand Casinos was HinesÂ’s employer.

IV. A.

Grand Casin o s argues that the federal and tribal courts m ay render inconsistent judgments as to who is HinesÂ’s employer, and the Indian Tribe should be joined to avoid this risk. This argument is meritless.

There is nothing inconsistent in holding that for purposes of title VII, Grand Casinos is HinesÂ’ employer, but under certain tribal or state anti-discrimination laws, the Indian Tribe is her employer. Nor is there any risk of double liabilit y for the Indian Tribe. The agreement renders Grand Casinos solely liable for any title VII judgment against it; the Indian Tr i be has no duty to indemnify.

B. Grand Casinos asserts that the Indian Tribe, as a party to the agreement, has an interest in how the agreement is interpreted, and t his interest makes it an indispensable party. But, Grand Casinos fails to articulate any concrete effect f ro m this title VII suit on the Indian Tribe. Even if it could, such a weak, indirect interest would not be sufficient. The Indian Tribe cannot be joined as a defendant under rule 19(a) unless H ines has a cause of action agains t it. See Vieux Carre Prop.

Ow ners, Residents & Assocs., Inc. v. Brow n , 875 F.2d 453, 457 (5th Cir. 1989). Title VII explicitly excludes Indian tr ibes from its scope, 42 U.S.C. § 2000e, and thus the Indian Tribe cannot be joined.

C. Gran d Casinos contends that the Indian Tribe has a “sovereign interest” in having this suit heard in tribal court. We disagree. Indian tribes enjoy li m ited sovereignty. Although they have retained ce r tain inherent powers as sovereigns SS the power to punish t r ibal 1 (...continued) (5th Cir. 1990); see a lso Nowlin , 33 F.3d at 506 (stating that “the right to control is an especia lly crucial factor”); Mares , 777 F.2d at 1067 (opining that the hybrid test “focuses more on the extent of the employer’s r ight to control the means and manner of the worker’s p e rformance” (internal quotation marks omitted)). offenders, to determine tribal membership, to regulate domestic relationships among tribe members, and prescribe rules of inheritance for members SS they have been di vest ed of nearly all power to regulate relations with nonmembers of the tribe. Montana v. United States , 450 U.S. 544, 563 (1981). Only where “necessary to protect tribal self-government or to control internal relations” do they have sovereign power over non-members. Id. Hines’s claim involves two nonmembers, a federal (not tribal) statute, and no possibility of liabilit y for the Indian Tribe. Grand Casinos h as not even alleged that this suit implicates the Indian Tribe’s self-government or internal relations. Accordingly, the district court did not err in concluding that the Indian Tribe is not indispensable under rule 19.

V. Grand Casinos argues that the Hines is required to exh aust her remedies in tribal court before the district court may hear them. As a matter of comity, a federal court will not enjoin tribal court proceedings or rule on a tribal courtÂ’s jurisdiction befo re tri bal court remedies are exhausted. 2 No ne of these elements applies to the instant suit, so the exhaustio n doctrine is inapposite.

The order denying Grand CasinosÂ’ motion to dismiss is AFFIRMED. We express no view on the ultimate merits of this case. 2 Iowa Mut. In s . Co. v. LaPlante , 480 U.S. 9, 1 5-16 (1987); N atÂ’l Farmers Union Ins. Cos. v. Crow Tribe of Indians , 471 U.S. 845, 857 (1985).

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