     Case: 18-40520      Document: 00514888841         Page: 1    Date Filed: 03/26/2019




           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT
                                                                           United States Court of Appeals
                                                                                    Fifth Circuit


                                      No. 18-40520
                                                                                  FILED
                                                                            March 26, 2019
                                                                             Lyle W. Cayce
RODOLFO PEREZ,                                                                    Clerk

              Plaintiff - Appellant

v.

MEGAN J. BRENNAN, Postmaster General of the United States, United
States Postal Services,

              Defendant - Appellee




                   Appeal from the United States District Court
                        for the Southern District of Texas
                              USDC No. 1:17-CV-43


Before CLEMENT, OWEN, and HO, Circuit Judges.
PER CURIAM:*
       Rodolfo Perez was a letter carrier for the United States Postal Service
(USPS) who sued for racial discrimination, retaliation, and hostile work
environment. The district court denied all of Perez’s claims. Perez appeals, and
we affirm.




       * 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 R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH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.
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                                   No. 18-40520
                            FACTS AND PROCEEDINGS
        Perez, who is Hispanic and of Mexican-American heritage, worked for
the USPS at the Brownsville Post Office. In 2007, a new postmaster arrived
and, according to Perez, called Hispanic employees “lazy.” On December 26,
2012, Perez’s supervisor accused him of smelling of alcohol and ordered him to
go home. On January 9, 2013, Perez gave written notice that he intended to
retire effective February 1, 2013. Perez stopped coming to work on January 13,
2013.
        On January 22, 2013, Perez was issued a letter of warning admonishing
him for unacceptable attendance. That same day, Perez’s supervisor and union
steward agreed to “hold off on all pending discipline.” On January 24, Perez
was issued a “Notice of Suspension” for his alleged on-duty impairment. The
USPS later agreed to expunge the notice.
        In March 2013, Perez filed an equal employment opportunity complaint
with the USPS, alleging racial discrimination, retaliation, and a hostile work
environment. Perez received an acceptance letter, notifying him that his claims
of discrimination and retaliation were accepted for investigation, but
dismissing his hostile work environment claim. The letter informed Perez that
if he disagreed with the defined accepted issues, he could respond in writing
within seven days. He did not.
        The investigation resulted in a denial of Perez’s claims, and he requested
a hearing before an administrative judge (AJ) at the Equal Employment
Opportunity Commission (EEOC). The AJ issued a summary judgment
decision against Perez on his discrimination and retaliation claims, noting that
claims of a hostile work environment were not before her. Perez appealed that
decision, which was upheld by the EEOC. The EEOC also stated that it did not
have jurisdiction to address Perez’s hostile work environment claim because
he had not responded to the acceptance letter.
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                                   No. 18-40520
       Perez subsequently filed suit in federal court, alleging racial
discrimination, retaliation, and a hostile work environment in violation of Title
VII of the Civil Rights Act of 1964. The district court dismissed Perez’s
discrimination claim because he had not plausibly stated a claim. The court
dismissed Perez’s retaliation claim premised on the letter of warning because
the letter was not an adverse employment action, but allowed the claim based
on the suspension notice to proceed. The court also dismissed Perez’s hostile
work environment claim for lack of subject matter jurisdiction, or alternatively
for failure to state a claim, because he had not exhausted his administrative
remedies. The court later denied the remaining retaliation claim on summary
judgment, holding that the suspension notice was not an adverse employment
action because Perez had stopped working and retired before receiving it. The
court alternatively held that Perez had not shown a genuine fact issue as to
whether the USPS’s legitimate articulated reason for the notice—Perez’s on-
duty impairment—was pretextual. The court also dismissed as moot other
pending motions, including Perez’s motion to amend his complaint, filed after
the court’s ruling on the USPS’s motion to dismiss.
       Perez timely appealed the district court’s rulings.
                                      DISCUSSION
 I.    Motion to Dismiss
       A district court’s order on a motion to dismiss under Federal Rule of Civil
Procedure 12(b)(6) is reviewed de novo. Allen v. Walmart Stores, L.L.C., 907
F.3d 170, 177 (5th Cir. 2018). A plaintiff “must ‘plead enough facts to state a
claim to relief that is plausible on its face.’” In re Katrina Canal Breaches Litig.,
495 F.3d 191, 205 (5th Cir. 2007) (quoting Bell Atl. Corp. v. Twombly, 550 U.S.
544, 570 (2007)). We may affirm a 12(b)(6) dismissal on any basis supported by
the record. Ferrer v. Chevron Corp., 484 F.3d 776, 780–81 (5th Cir. 2007).


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                                  No. 18-40520
         A. Discrimination claim
      The district court held that Perez did not plead sufficient facts to state a
plausible discrimination claim. Perez’s only allegation with respect to this
claim is that the postmaster called Hispanic and Mexican-American employees
“lazy,” without specifying when this occurred or how often. The “ultimate
question” in a Title VII discrimination action is “whether a defendant took [an]
adverse employment action against a plaintiff because of [his] protected
status.” Kanida v. Gulf Coast Med. Pers. LP, 363 F.3d 568, 576 (5th Cir. 2004).
Perez’s lone allegation is insufficient to state a claim of discrimination. See
Boyd v. State Farm Ins. Cos., 158 F.3d 326, 329 (5th Cir. 1998) (“The mere
utterance of a racial epithet is not indicia of discrimination under Title VII.”).
The court correctly dismissed Perez’s discrimination claim.
         B. Letter-of-warning retaliation claim
      Perez argues the district court erroneously used the “ultimate
employment decision” standard in deciding this claim, which was rejected by
the Supreme Court in Burlington Northern & Santa Fe Railway Co. v. White,
548 U.S. 53 (2006).
      To state a Title VII retaliation claim, “a plaintiff must allege that (1) he
participated in an activity protected by Title VII; (2) his employer took an
adverse employment action against him; and (3) a causal connection exists
between the protected activity and the adverse employment action.” Leal v.
McHugh, 731 F.3d 405, 416–17 (5th Cir. 2013) (quotation omitted). An adverse
employment action is one that a “reasonable employee would have found . . .
materially adverse, which in this context means it well might have dissuaded
a reasonable worker from making or supporting a charge of discrimination.”
Burlington N., 548 U.S. at 68 (quotations omitted).
      The district court used the correct standard in dismissing Perez’s letter-
of-warning retaliation claim. The court held that a reasonable employee would
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                                  No. 18-40520
not have found the warning letter to be materially adverse, and so it was not
an adverse employment action. This ruling is consistent with prior holdings of
this court. See Hernandez v. Johnson, 514 F. App’x 492, 499 (5th Cir. 2013)
(per curiam) (finding a letter identifying instances of misconduct not to be an
adverse employment action); DeHart v. Baker Hughes Oilfield Operations, Inc.,
214 F. App’x 437, 442 (5th Cir. 2007) (per curiam) (finding a single written
warning not to be materially adverse).
         C. Hostile work environment claim
      Perez contends the district court erred in dismissing his hostile work
environment claim. He argues the court incorrectly dismissed the claim for
lack of subject matter jurisdiction, and that the court’s rationale—failure to
exhaust administrative remedies—was incorrect.
      The district court dismissed this claim for lack of subject matter
jurisdiction under Rule 12(b)(1) or alternatively for failure to state a claim
under Rule 12(b)(6) because of a conflict in this circuit’s law that has since been
resolved. See Davis v. Fort Bend Cty., 893 F.3d 300, 305 (5th Cir. 2018) (“[A]
Title VII plaintiff’s failure to exhaust . . . administrative remedies is not a
jurisdictional bar but rather a prudential prerequisite to suit.”). In ruling
under Rule 12(b)(6), the court held that Perez failed to state a plausible claim
for relief because he failed to exhaust his administrative remedies when he did
not challenge the USPS’s decision not to accept his hostile work environment
claim for investigation.
      This court has not definitively addressed the exhaustion requirement
where an agency notifies an employee that it is accepting only some of his
claims. We need not do so, because regardless of whether Perez exhausted his
administrative remedies, he did not plead sufficient facts to plausibly allege a
claim for relief. To plead a Title VII hostile work environment claim, a plaintiff
must allege facts showing, among other things, that the “harassment
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                                  No. 18-40520
complained of affected a term, condition, or privilege of employment.” Ramsey
v. Henderson, 286 F.3d 264, 268 (5th Cir. 2002). “For harassment . . . to affect
a term, condition, or privilege of employment, . . . it must be sufficiently severe
or pervasive to alter the conditions of the victim’s employment and create an
abusive working environment.” Id. (quotations omitted).
       Perez’s only allegations are that the postmaster “had called the
Hispanic/Mexican American employees ‘lazy’” and that he was issued a letter
of warning about attendance and a suspension notice. Perez baldly asserts in
his complaint that these actions “were severe and pervasive enough to alter
the terms and conditions of employment” but does not specify how.
       The letter and notice were issued after Perez gave notice of his
retirement and stopped working and so could not have altered the terms of his
employment or created an abusive working environment. And Perez has not
sufficiently alleged that the postmaster calling certain employees lazy altered
the conditions of his employment or created an abusive working environment.
See, e.g., Jones v. Flagship Int’l, 793 F.2d 714, 720 (5th Cir. 1986) (“[T]he mere
utterance of an ethnic or racial epithet . . . does not affect the terms[,]
conditions, or privileges of employment to a sufficiently significant degree to
violate Title VII.” (quotation omitted)). Perez offers no other factual allegations
to support his claim, and so has failed to plausibly state a claim for relief.
II.    Summary Judgment
       We review a district court’s grant of summary judgment de novo. Bridges
v. Empire Scaffold, L.L.C., 875 F.3d 222, 225 (5th Cir. 2017). “Summary
judgment is appropriate if ‘there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of law.’” Id. (quoting FED.
R. CIV. P. 56(a)).




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                                         No. 18-40520
           A. Drunk-on-duty retaliation claim
       The district court denied Perez’s remaining retaliation claim on
summary judgment. First, the court held that affidavits produced in support
of Perez’s opposition were sham affidavits, as they contained material
contradictions to his prior deposition testimony regarding how much he drank
the night before he was sent home. The court held that Perez had not shown
an issue of fact whether the USPS’s legitimate reason for the suspension—on-
duty impairment—was pretextual. The court alternatively held that Perez’s
suspension was not an adverse employment action.
       Perez primarily takes issue with the court’s evidentiary ruling. “The
court’s evidentiary rulings regarding the competency of evidence are reviewed
for abuse of discretion.” Hacienda Records, L.P. v. Ramos, 718 F. App’x 223,
234 (5th Cir. 2018) (per curiam). In his deposition, Perez testified that he drank
ten beers the night before the incident. In their summary judgment affidavits,
Perez and his wife state that he drank only two beers. The district court did
not abuse its discretion in finding this to be a direct, material conflict with
respect to Perez’s argument that the legitimate reason for his suspension was
pretextual and striking the affidavits. 1
       Regardless, the court’s evidentiary ruling did not affect its holding that
the suspension was not a materially adverse action because it did not affect
Perez’s “job title, grade, hours, salary or benefits” or cause “a diminution in
prestige or change in standing among . . . co-workers.” Stewart v. Miss. Transp.
Comm’n, 586 F.3d 321, 332 (5th Cir. 2009). The suspension notice was issued



       1  We will not consider Perez’s argument, first raised on appeal, that the deposition
question he answered was confusing. See AG Acceptance Corp. v. Viegel, 564 F.3d 695, 700
(5th Cir. 2009) (holding “arguments not raised before the district court are waived and will
not be considered on appeal” absent extraordinary circumstances); see also FED. R. CIV. P.
32(d)(3)(B) (“An objection to an error or irregularity at an oral examination is waived if . . . it
is not timely made during the deposition.”).
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                                 No. 18-40520
to Perez after he gave notice of his retirement and after he stopped working. It
was also expunged within a month. Perez has not argued nor shown an issue
of fact as to whether the notice was an adverse employment action.
         B. Motion to amend complaint
      Following the district court’s partial grant of the motion to dismiss, Perez
filed for leave to amend his complaint as to the dismissed claims. When ruling
on summary judgment, the court dismissed the motion as moot, but also noted
that, with respect to additional allegations regarding the letter of warning,
amendment would be futile.
      “We review the district court’s denial of a motion for leave to amend for
abuse of discretion.” Moore v. Manns, 732 F.3d 454, 456 (5th Cir. 2013) (per
curiam). The court should “freely give leave [to amend] when justice so
requires.” FED. R. CIV. P. 15(a)(2). In determining whether to grant a motion
for leave to amend, the court may consider five factors: “undue delay, bad faith
or dilatory motive . . ., repeated failure to cure deficiencies by [prior]
amendments . . ., undue prejudice . . ., [and] the futility of the amendment.”
Rosenzweig v. Azurix Corp., 332 F.3d 854, 864 (5th Cir. 2003) (second
alteration in original) (quotation omitted). The court found that amendment
would be futile, as Perez’s new allegations as to the letter of warning did not
show that it was an adverse action, a necessary allegation to plausibly state
his previously dismissed claims. This was not an abuse of discretion.
                                    CONCLUSION
      In light of the foregoing, the district court’s rulings are AFFIRMED.




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