           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT
                                                                           United States Court of Appeals
                                                                                    Fifth Circuit
                                                                                 F I L E D
                                       No. 05-60657                             September 13, 2007

                                                                              Charles R. Fulbruge III
FRANCES ELAINE HOOD                                                                   Clerk

                                                  Plaintiff - Appellant
v.

ADRIAN TINTA; ET AL

                                                  Defendants

SEARS ROEBUCK & CO.

                                                  Defendant - Appellee


                   Appeal from the United States District Court
                     for the Southern District of Mississippi
                                  3:02-CV-405


Before GARWOOD, JOLLY, and STEWART, Circuit Judges.
PER CURIAM:*
       Frances Elaine Hood brought this suit alleging that Sears Roebuck & Co.
and its employee Adrian Tinta denied Hood’s workers’ compensation claim in
bad faith. The claim arose out of psychological injuries allegedly resulting from
sexual harassment and retaliation by one of Hood’s supervisors, Michael
McDonald.       Hood claimed that she and McDonald engaged in a sexual


       *
         Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
                                 No. 05-60657

relationship in December 1995 and that McDonald treated her with hostility and
refused to give her a favorable work schedule in retaliation for reporting the
relationship to her supervisor, Adrian Tinta, in March 1996. Hood’s emotional
condition deteriorated in the spring and summer of 1996.
      This litigation, in one form or another, has been ongoing for several years.
Earlier, Hood filed suits under Title VII and state law that ended in summary
judgment for Sears.     She then filed a claim with the Mississippi Workers’
Compensation Commission. Sears and its carrier settled with Hood in January
2002. Hood filed the present case against Sears and Tinta in state court,
alleging breach of contract, gross negligence, and bad faith in refusing to pay
workers’ compensation benefits. Sears removed the case to district court on the
basis of diversity. The court denied Hood’s motion to remand, finding fraudulent
joinder because Hood had signed a release that precluded any possibility of
recovery against Tinta.
      Sears filed a motion for summary judgment, which the district court
denied. The district court revisited the summary judgment motion during a
pretrial conference approximately two weeks later. The court granted Sears’s
motion for summary judgment, finding that Sears had an arguable reason to
deny Hood’s claim. The district court entered a final judgment from which Hood
appeals.   Hood contends that the district court erred in denying remand,
reconsidering summary judgment without prior notice, relying on McDonald’s
deposition, and granting summary judgment in favor of Sears.
      Finding no error in the district court’s denial of remand or grant of
summary judgment, we AFFIRM.
                                        I.
      The district court did not err in denying Hood’s motion to remand. “To
establish that a non-diverse defendant has been improperly joined to defeat
diversity jurisdiction, the removing party must prove (1) actual fraud in the


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pleading of jurisdictional facts, or (2) inability of the plaintiff to establish a cause
of action against the non-diverse party in state court.” Rico v. Flores, 481 F.3d
234, 238 (5th Cir. 2007) (quotation omitted). Here, Hood signed a release that
clearly releases Sears and its employees from “any and all claims of every kind
and character arising out of or in any way connected with” her compensation
claim. This case obviously arises from her workers’ compensation claim. The
district court did not err in finding that this release established an inability to
pursue a cause of action against Tinta in state court.
                                          II.
      The district court did not err in reconsidering Sears’s motion for summary
judgment at the pretrial conference without giving Hood prior notice. This Court
has stated that when “the parties have been given ample opportunity to respond
to the motion for summary judgment, the district court may rule on it. . . without
giving the parties advance notice of the court’s intention to consider and decide
the motion on a ‘date certain.’” Daniels v. Morris, 746 F.2d 271, 275-76 (5th Cir.
1984). Hood had notice of Sears’s original motion for summary judgment and
responded to it. The same issues disputed at summary judgment were to be at
the forefront of the trial and were thus fresh to the parties when the court
reconsidered its denial of Sears’s motion for summary judgment.             Moreover,
Hood has not shown that she was prejudiced by the district court’s
reconsideration of Sears’s motion for summary judgment.
                                          III.
      The district court did not err in considering McDonald’s deposition in
determining that Sears had an arguable reason to deny Hood’s workers’
compensation claim. In his deposition for an earlier lawsuit involving the
incidents underlying this case, McDonald denied having a sexual relationship
with Hood.     Federal Rule of Civil Procedure 56(c) includes affidavits and
depositions as appropriate bases for summary judgment. The deposition is not

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inadmissible hearsay, because it was not offered to prove the truth of the matter
of whether there was a sexual relationship, but as evidence that McDonald
denied the relationship. In addition, the deposition was referenced in Sears’s
motion for summary judgment and supplements other affidavits of Sears that
reflect McDonald’s denial of any sexual relationship with Hood.
                                      IV.
      Finally, the district court did not err in granting Sears’s motion for
summary judgment. To show bad faith denial of a workers’ compensation claim
under Mississippi law, “there must be a determination as to whether there was
a legitimate or arguable reason to deny the benefits, and/or that the denial
constituted a willful or malicious wrong.” Mississippi Power and Light Co. v.
Cook, 832 So. 2d 474, 479 (Miss. 2002). McDonald’s denials of any sexual
relationship with Hood were presented in his own deposition and in affidavits
of Sears employees who investigated the allegations. The evidence shows that
Sears had an arguable reason to deny Hood’s claim because McDonald’s sworn,
unequivocal denial of Hood’s allegations was a basis for Sears reasonably to
believe Hood’s injuries were not work-related and therefore not eligible for
workers’ compensation. The record reflects no indication that Sears had any
reason to doubt McDonald’s denial.
      In sum, Hood cannot satisfy the requirements of the standard for bad faith
under Mississippi law. There is no evidence that Sears committed a willful and
malicious wrong by denying Hood coverage with the knowledge that she had a
valid claim. Therefore, the district court did not err in determining that Hood
could not recover as a matter of law and granting Sears’s motion for summary
judgment.
                                       V.
      For the foregoing reasons, the judgment of the district court is
                                                                   AFFIRMED.

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