McKey v. August et al
Filing
216
ORDER AND REASONS: IT IS HEREBY ORDERED that the 146 Motion For Summary Judgement to Dismiss Plaintiffs Breach of Contract Claim is GRANTED. Susan Dillard McKey's breach of contract claims asserted against Roberta Zeno August and the St. John the Baptist Parish Library Board are DISMISSED WITH PREJUDICE. Signed by Judge Wendy B Vitter on 8/16/2021. (Reference: 16-13642)(jeg)
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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
SUSAN DILLARD MCKEY
CIVIL ACTION
VERSUS
NO. 16-13642-WBV-MBN
ROBERTA ZENO AUGUST, ET AL.
SECTION: D (5)
ORDER AND REASONS
Before the Court is a Motion For Summary Judgement to Dismiss Plaintiff’s
Breach of Contract Claim, filed by Roberto Zeno August and the St. John the Baptist
Parish Library Board (collectively, “Defendants”).1 Susan Dillard McKey opposes the
Motion,2 and Defendants have filed a Reply.3 After careful consideration of the
parties’ memoranda and the applicable law, the Motion is GRANTED.
I.
FACTUAL AND PROCEDURAL BACKGROUND4
This case involves a civil rights lawsuit filed by Susan Dillard McKey, a former
employee of the St. John the Baptist Parish Library (the “Library”), who alleges
reverse racial discrimination and deprivation of continued family health insurance
coverage without due process of law.5 In her original Complaint, McKey asserts three
causes of action: (1) a claim under 42 U.S.C. § 1981(a) against August, in her
individual capacity, for hostile work environment and for discriminatory demotion
R. Doc. 146.
R. Doc. 154.
3 R. Doc. 171.
4 In the interest of judicial economy, and because the factual background of this case was extensively
detailed in the Court’s prior Orders (R. Docs. 40 & 63), the Court will limit its recitation of the
factual and procedural background to matters relevant to the instant Motion
5 See, R. Docs. 1 & 44.
1
2
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and termination; (2) a claim for “breach of contract and denial of due process” against
the Library Board; and (3) a claim for false arrest/imprisonment against St. John the
Baptist Sheriff’s Office.6 McKey’s claim against the Sheriff’s Office was subsequently
dismissed by the Court on October 3, 2006.7
Thereafter, McKey amended her
Complaint to allege facts regarding her purported property interest in the retirement
benefits set forth in the Library Board’s Policies and Procedural Manual (the “Policy
Manual”) and to allege a breach of contract claim against August and the Library
Board based upon the divesture of her “vested rights” in the continued health
insurance benefits set forth in the Policy Manual, a claim that McKey had previously
abandoned.8
On January 7, 2020, Defendants filed the instant Motion, seeking summary
judgment regarding McKey’s breach of contract claims.9 Defendants assert that they
are entitled to dismissal because McKey did not have an employment contract with
either August or the Library Board and, even if she had an employment contract with
the Library Board, Defendants did not breach it based on the clear and unambiguous
terms of the Policy Manual.10 Defendants assert that at all material times, McKey’s
R. Doc. 1 at ¶¶ 54-77.
R. Doc. 23.
8 R. Doc. 44. This Court previously recognized the abandonment of these claims in its July 6, 2017
Order and Reasons. R. Doc. 63 at pp. 2-3 (“In her amended complaint, McKey made allegations against
Ms. August, in addition to the Library Board, for the denial of a right to continuing health insurance
benefits; she also asserted a claim against both defendants for violations of Louisiana state contracts
law (a claim she had previously abandoned).”) McKey acknowledges in her Opposition brief that the
state law breach of contract claims were previously abandoned. R. Doc. 154 at p. 11 (“she also asserted
a claim against both defendants for violations of Louisiana state contracts law (a claim she had
previously abandoned).”).
9 R. Doc. 146.
10 Id. at ¶ 14.
6
7
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employment with the Library was at-will.
Defendants claim that the source of
McKey’s claim for continuing family health insurance derives from the Policy Manual
which, at the time of her termination in 2015, provided the following:
6. The Library participates in the health, dental and life insurance
program offered by the Parish Government for all regular full time
employees and their dependents.
7. The Insurance benefit is paid at a rate of 100% by the Library for
regular full time employees and for retired employees who qualify for
retirement under the Parochial Employees Retirement System.
8. The retiring employee must notify the Administrative Librarian six
(6) weeks before the anticipated date of retirement if he/she elects to
retain the insurance offered by the Library.11
Defendants argue that the Policy Manual did not create an employment contract with
McKey, and that it expressly disclaimed that it was an employment contract,
providing that:
Not a Contract: This manual is designed to acquaint the employee with
working for the St. John the Baptist Parish Library and to provide
information on our current employment practices. Neither this manual
nor any of the policies and practices included is intended as an
employment contract (express or implied) and accordingly should not be
considered as such. Nothing in this manual should be relied upon as a
guarantee for certain privileges, working conditions or continued
employment.12
Defendants assert that McKey acknowledged that she signed an Acknowledgment of
the Policy Manual, had access to the Policy Manual, and familiarized herself with the
applicable policies.13 Defendants argue that Louisiana courts consistently reject the
notion that employee handbooks and policy manuals form employment contracts,
R. Doc. 146-2 at pp. 3-4 (quoting R. Doc. 146-1 at p. 12).
R. Doc. 146-2 at p. 4 (quoting R. Doc. 146-1 at p. 9).
13 R. Doc. 146-2 at p. 4 (citations omitted).
11
12
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especially where, as in this case, they expressly state that they are not employment
contracts and are merely informational statements of current employment policies.14
McKey argues that she had a contractual entitlement to her continuing health
care coverage as a result of the Library’s Board’s Policy Manual, and that her
property interest in retirement benefits, including continued health care coverage,
originates from Louisiana Constitution Article 10, § 29(B).15
According to that
provision, “[m]embership in any retirement system of the state or of a political
subdivision thereof shall be a contractual relationship between employee and
employer, and the state shall guarantee benefits payable to a member of a state
retirement system or retiree or to his lawful beneficiary upon his death.” 16 McKey
argues that she met all of the eligibility criteria for the vesting of retirement benefits
through the Deferred Retirement Option Plan (“DROP”) and, as such, had an
entitlement to the promised benefit of continued health care coverage.17 As such,
McKey claims her interest in continuing health care coverage “is clearly a sufficient
property interest to invoke due process protections.”18 McKey then recounts how the
Court previously granted Defendants’ motion to dismiss her amended claim based on
her purported Fourteenth Amendment right to continued health insurance benefits,19
but later rescinded the Order and denied Defendants’ motion to dismiss, concluding
that McKey had stated a plausible § 1983 claim to continuing health insurance
Id. at pp. 2, 8-11.
R. Doc. 154 at pp. 6-7 (citing authority).
16 Id. (quoting LA. CONST. Art. 10, § 29(B)) (emphasis added by McKey).
17 R. Doc. 154 at p. 8 (citing Smith v. Bd. of Trustees of Louisiana Sch. Emp. Ret. Sys., 398 So.2d
1045 (La. 1981)).
18 R. Doc. 154 at p. 9.
19 R. Doc. 154 at pp. 11-12; See, R. Doc. 49.
14
15
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benefits as a retired employee.20 McKey argues that the “law of the case” doctrine
applies here, and that the instant Motion should be denied because this Court already
rejected the same arguments raised by Defendants, namely, that McKey is not retired
because she was terminated.21 McKey contends that because there is evidence that
she enrolled in the DROP retirement plan on September 23, 2013, there are genuine
issues of fact as to whether she was “retired,” thus precluding summary judgment.22
McKey further asserts that her claim against August for continued health insurance
coverage should not be dismissed because she has alleged that August terminated
her health insurance benefits and, therefore, violated her constitutional rights.23
In response, Defendants assert that McKey completely misunderstands the
arguments raised in their Motion, which seeks dismissal of her state law breach of
contract claim.24 Defendants argue that whether McKey had a vested property
interest in continuing health insurance is a separate claim and analysis from her
state law contract claims. Defendants point out that McKey failed to address a single
issue briefed in their Motion, and that the Court should grant summary judgment on
that basis alone. Defendants argue that McKey has presented no law or evidence to
demonstrate that she had a valid employment contract with either August or the
Library Board through the Policy Manual, or that the Policy Manual grants her a
contractual right to continuing health insurance.25
R. Doc. 154 at p. 12 (citing R. Doc. 63).
R. Doc. 154 at pp. 12-13 (citing authority).
22 R. Doc. 154 at p. 13.
23 R. Doc. 154 at pp. 13-14.
24 R. Doc. 171 at p. 1.
25 R. Doc. 171 at pp. 2-4.
20
21
Defendants maintain that
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McKey’s entitlement to continuing health insurance benefits starts and ends with the
Policy Manual, and that she is not entitled to those benefits as a matter of Louisiana
contract law.26
II.
LEGAL STANDARD
Summary judgment is appropriate where there is no genuine disputed issue as
to any material fact, and the moving party is entitled to judgment as a matter of
law.27 When assessing whether a dispute regarding any material fact exists, the
Court considers “all of the evidence in the record but refrain[s] from making
credibility determinations or weighing the evidence.”28
While all reasonable
inferences must be drawn in favor of the nonmoving party, a party cannot defeat
summary judgment with conclusory allegations, unsubstantiated assertions or “only
a scintilla of evidence.”29 Instead, summary judgment is appropriate if a reasonable
jury could not return a verdict for the nonmoving party.30
If the dispositive issue is one on which the moving party will bear the burden
of proof at trial, the moving party “must come forward with evidence which would
entitle it to a directed verdict if the evidence went uncontroverted at trial.”31 The
nonmoving party can then defeat summary judgment by either submitting evidence
Id. at p. 6 (footnote omitted).
Fed. R. Civ. P. 56; Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265
(1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 2509-10, 91 L.Ed.2d 202
(1986).
28 Delta & Pine Land Co. v. Nationwide Agribusiness Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 2008)
(citations omitted).
29 Id. (quoting Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994)) (internal quotation marks
omitted).
30 Delta & Pine Land Co., 530 F.3d at 399 (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248,
106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)).
31 International Shortstop, Inc. v. Rally’s, Inc., 939 F.2d 1257, 1264-65 (5th Cir. 1991).
26
27
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sufficient to demonstrate the existence of a genuine dispute of material fact, or by
“showing that the moving party’s evidence is so sheer that it may not persuade the
reasonable fact-finder to return a verdict in favor of the moving party.”32 If, however,
the nonmoving party will bear the burden of proof at trial on the dispositive issue,
the moving party may satisfy its burden by merely pointing out that the evidence in
the record is insufficient with respect to an essential element of the nonmoving
party’s claim.33 The burden then shifts to the nonmoving party who must go beyond
the pleadings and, “by her own affidavits, or by the ‘depositions, answers to
interrogatories, and admissions on file,’ designate ‘specific facts showing that there
is a genuine issue for trial.’”34
III.
ANALYSIS
Contrary to McKey’s assertions, the issue before the Court is not whether she
has sufficiently alleged a property interest in the continued health insurance
coverage set forth in the Library’s Policy Manual. In fact, that question is before the
Court in another motion currently pending before the Court.35
Instead, as
Defendants aptly point out in their Reply brief, the sole issue before the Court is
whether Defendants are entitled to judgment as a matter of law on McKey’s breach
of contract claims that are based upon a purported breach of the Policy Manual
provisions.
Id. at 1265.
See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986).
34 Celotex Corp., 477 U.S. at 324, 106 S.Ct. at 2553 (quoting Fed. R. Civ. P. 56(e)).
35 See, R. Doc. 71; R. Doc. 71-1 at pp. 18-24.
32
33
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In her original claim for “breach of contract and denial of due process” against
the Library Board, McKey alleged that, “At all times relevant hereto, the Plaintiff
had a valid and enforceable employment contract with the St. John the Baptist Parish
Library,” and that, “Per the terms of the Plaintiff’s employment contract, she was
eligible for retirement and had fully vested in her retirement benefits from St. John
the Baptist Parish.”36
In her First Amended Complaint, McKey amended her
Complaint to include the following allegation:
However, based on their arbitrary and unlawful interpretation of the
Policies and Procedures Manual, the Defendants attempted to divest the
Plaintiff’s vested rights in the continued health insurance benefits
which had been contractually promised to the Plaintiff and other
employees, dependents and retirees by the St. John the Baptist Library
Board. This action by the Defendants violated Louisiana state contracts
law, the Due Process Clause of the Fourteenth Amendment to the
United States Constitution and Article I, § 2 of the Louisiana
Constitution.37
The First Amended Complaint also adds a claim for $200,000 in uncovered medical
expenses based upon McKey’s loss of her health insurance benefits.38
At the outset, the Court notes that McKey does not allege that she was
employed by the Library for a fixed term, or that she had a written employment
contract. Instead, Plaintiff specifies in her Response to Defendant’s [sic] Statement
of Undisputed Material Facts in Support of Motion for Summary Judgment that, “At
all times relevant hereto, Plaintiff had a valid contact of employment with Defendant
Board as a matter of law as the Board promised Plaintiff health insurance benefits
R. Doc. 1 at ¶¶ 70 & 71.
R. Doc. 44 at p. 3.
38 Id. at pp. 3-4.
36
37
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and Plaintiff accepted these benefits.”39 The evidence before the Court shows that
McKey testified during a deposition that she was an at-will employee of the Library.40
McKey, however, seems to allege that Defendants breached the Library’s Policy
Manual by discontinuing her family health insurance when she was terminated from
employment. As Defendants point out, however, courts applying Louisiana law have
consistently held that employee manuals and handbooks do not create contractual
rights, especially where, as here, the Policy Manual contains a disclaimer that it is
not a contract. In Wallace v. Shreve Memorial Library, the Fifth Circuit, applying
Louisiana law, rejected the plaintiff’s argument that the library’s employment
manual created a contract that provided that she would only be fired for cause. 41
Relying on Louisiana jurisprudence, the Fifth Circuit held that Louisiana courts
“have found that employment manuals are not agreements between two parties.”42
The Fifth Circuit pointed out that Louisiana courts have distinguished manuals on
the basis that their policies were not a bargained for condition of employment, but
merely a unilateral expression of company policies and procedures.43 The Wallace
court concluded that the employment manual at issue was insufficient to create
contractual rights even though it did not contain a disclaimer stating that it was not
a contract.44 In doing so, the Fifth Circuit noted that, “If there were such a disclaimer,
R. Doc. 154-1 at ¶ 4 (citing Knecht v. Bd. of Trustees For State Colleges & Univs. And Northwestern
State Univ., 591 So.2d 690, 695 (La. 1991)).
40 R. Doc. 146-6 at p. 2.
41 79 F.3d 427, 430-31 (5th Cir. 1996).
42 Id. (citing Keller v. Sisters of Charity, 597 So.2d 1113, 1116 (La. App. 2 Cir. 1992); Thebner v. Xerox
Corp. 480 So.2d 454, 457 (La. App. 3 Cir. 1985)).
43 Wallace, 79 F.3d at 430 (quoting Leger v. Tyson Foods, Inc., 670 So.2d 397, 401-02 (La. App. 3 Cir.
1996)) (quotation marks omitted).
44 79 F.3d at 431.
39
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our job of course would be easier. However, Louisiana courts have found employment
manuals not to be contracts even without disclaimers (and we have found no cases
where the absence of a disclaimer made the manual a contract).”45
Other courts applying Louisiana law have reached the same conclusion. The
Middle District of Louisiana has held that an arbitration clause contained in an
employee handbook did not constitute a contract under Louisiana law, recognizing
that, “Louisiana state courts have overwhelmingly rejected employment manuals as
the source of contractual obligations,” and that, “Federal courts have followed the
same rule.”46 In Adams v. Autozoners, Inc., another Section of this Court similarly
rejected an employee’s breach of contract claim based upon the violation of the terms
of an employee handbook.47 In doing so, this Court found “no Louisiana jurisprudence
holding that an employee manual creates a contract which can modify an at-will
employment relationship,” and that, “a number of state and federal cases applying
Louisiana law have concluded that employment manuals, policies, and grievance
procedures did not confer contractual rights upon employees, nor did they create any
exceptions to the employment at-will doctrine.”48 Louisiana appellate courts have
reached the same conclusion.49 Louisiana courts have also found that manuals are
merely a unilateral expression of company policies and procedures, and that any
Wallace, 79 F.3d at 431 (citing Keller, 597 So.2d at 1116).
Walker v. Air Liquide America Corp., 113 F. Supp. 2d 983, 985 (M.D. La. 2000).
47 Adams v. Autozoners, Inc., Civ. A. No. 98-2336, 1999 WL 744039, at *5-6 (E.D. La. Sept. 23, 1999).
48 Id., Civ. A. No. 98-2336, 1999 WL 744039 at *6 (citing Wallace, 79 F.3d at 430).
49 See, Square v. Hampton, 2013-1680 (La. App. 4 Cir. 6/4/14), 144 So.3d 88, 98-99 (citing Mix v. The
Univ. of New Orleans, 609 So.2d 958, 964 (La. App. 4 Cir. 1992); Leger v. Tyson Foods, Inc., 95-1055
(La. App. 3 Cir. 1/31/96), 670 So.2d 397, 401-02; Wall v. Tulane University, 499 So.2d 375, 375-76 (La.
App. 4 Cir. 1986).
45
46
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benefits conferred by such manuals are merely gratuitous and not binding on the
employer.50 As noted by one Louisiana court, “The contention that a handbook
creates a contract between an otherwise ‘at will’ employee and his employer is neither
novel nor, in this jurisdiction, meritorious.”51
McKey does not address any of the foregoing authority in her Opposition brief,
nor does she address any of the arguments raised by Defendants in their Motion for
Summary Judgment. Similar to the plaintiffs in the cases cited above, McKey has
not offered any evidence that she bargained for the provisions in the Policy Manual
as a condition of her employment with the Library.52 As such, the Court finds that
the Policy Manual is merely a unilateral statement by the Library Board of its policies
and procedures and does not does confer contractual rights upon McKey.53 Moreover,
the Policy Manual contains an explicit disclaimer stating that it is not a contract:
Not a Contract: This manual is designed to acquaint the employee with
working for the St. John the Baptist Parish Library and to provide
information on our current employment practices. Neither this manual
nor any of the policies and practices included is intended as an
employment contract (express or implied) and accordingly should not be
considered as such. Nothing in this manual should be relied upon as a
Leger, 95-1055, 670 So.2d at 401-02; Wall v. Tulane Univ., 499 So.2d 375, 375-76 (La. App. 4 Cir.
1986).
51 Stanton v. Tulane Univ. of Louisiana, 2000-0403 (La. App. 4 Cir. 1/10/01), 777 So.2d 1242, 1250;
Square, 2013-1680, 144 So.3d at 98 (quoting Stanton, supra).
52 Wallace, 79 F.3d at 430 (citing Leger v. Tyson Foods, Inc., 670 So.2d 397, 401-02 (La. Ct. App. 1996)).
See, Adams v. Autozoners, Inc., Civ. A. No. 98-2336, 1999 WL 744039, at *6 (E.D. La. Sept. 23, 1999).
53 Wallace, 79 F.3d at 430 (quoting Leger v. Tyson Foods, Inc., 670 So.2d 397, 401-02 (La. Ct. App.
1996)) (quotation marks omitted).
50
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guarantee for certain privileges, working conditions or continued
employment.54
Based upon this disclaimer, the Court finds that any violations of the Policy Manual
cannot serve as the basis for McKey’s breach of contract claim.55
Accordingly,
Defendants are entitled to judgment as a matter of law on McKey’s breach of contract
claims.
IV.
CONCLUSION
IT IS HEREBY ORDERED that the Motion For Summary Judgement to
Dismiss Plaintiff’s Breach of Contract Claim56 is GRANTED. Susan Dillard McKey’s
breach of contract claims asserted against Roberta Zeno August and the St. John the
Baptist Parish Library Board are DISMISSED WITH PREJUDICE.
New Orleans, Louisiana, August 16, 2021.
______________________________
WENDY B. VITTER
United States District Judge
R. Doc. 146-2 at p. 4 (quoting R. Doc. 146-1 at p. 9).
Smith v. Bd. of Supervisors for the Univ. of Louisiana Sys., Civ. A. No. 13-5505, 2015 WL 10663156,
at *9 (E.D. La. Dec. 11, 2015) (citing Oller v. Roussel, Civ. A. No. 11-02207, 2014 WL 1789655, at *1
(W.D. La. May 5, 2014)). See, Wallace v. Shreve Mem. Library, 79 F.3d 427, 431 (5th Cir. 1996) (“If
there were such a disclaimer, our job of course would be easier.”).
56 R. Doc. 146.
54
55
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