Appellant Brief - Perry v. VHS

Case: 20-50356 Document: 00515486766 Page: 1 Date Filed: 07/13/2020
No. 20-50356
IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT
DOCTOR MELVIN G. PERRY, JR.,

Plaintiff-Appellant
-v-
VHS SAN ANTONIO PARTNERS, L.L.C., doing business as North

Central Baptist Hospital,
Defendant-Appellee
Appeal from the United States District Court

for the Western District of Texas, No. 5:18-CV-404
INITIAL BRIEF OF APPELLANT
Colin Walsh
Texas Bar No. 24079538
Board Certified in Labor and
Employment Law by the Texas
Board of Legal Specialization
WILEY WALSH, P.C.

1011 San Jacinto Blvd, Ste 401
Austin, TX 78701
Telephone: (512) 271-5527
Facsimile: (512) 201-1263
ATTORNEY FOR APPELLANT
CERTIFICATE OF INTERESTED PERSONS
The undersigned counsel of record certifies that the following listed
persons and entities as described in the fourth sentence of Rule 28.2.1
have an interest in the outcome of this case. These representations are
made in order that the judges of this Court may evaluate possible
disqualification or recusal:
Dr. Melvin G. Perry, Jr. – Plaintiff/Appellant
Colin Walsh – Counsel for Plaintiff/Appellant
Wiley Walsh, P.C. – Counsel for Plaintiff/Appellant
VHS San Antonio Partners, L.L.C. – Defendant/Appellee
Tiffany Cox Stacy – Counsel for Defendant/Appellee
Kelly E. Preston – Counsel for Defendant/Appellee
Ogletree Deakins – Counsel for Defendant/Appellee
Pediatric Inpatient Critical Care Services, P.A. – Defendant
Angella Herbert Myers – Counsel for Defendant
Sharon S. Gilmore – Counsel for Defendant
Myers Law Group, LLP – Counsel for Trial Court Defendant
/s/ Colin Walsh

Colin Walsh
ii
REQUEST FOR ORAL ARGUMENT
Appellant requests oral argument on two important matters:
I.
Is a direct employment relationship required for Title VII liability?
In Bloom v. Bexar County, Tex., this Court stated in a footnote that there
is a “possibility that a plaintiff may maintain an action against a
defendant who is not, technically, the plaintiff’s direct employer . . . .”
130 F.3d 722, 725 n. 2 (1997). To date this Court has never squarely
addressed whether Sibley standing exists in this Circuit. This case
presents such an opportunity, as well as the opportunity to address what
is required to show a single integrated enterprise and a joint employer
relationship.
In Sibley Memorial Hospital v. Wilson, the D.C. Circuit held that
Title VII does not require a direct employment relationship between an
employee and an employer. 488 F.2d 1338, 1341 (1978). The D.C. Circuit
found that if an “employer” as defined by Title VII interfered with the
employment opportunities of an individual with a third party, such action
was covered by Title VII. Id. The Courts of Appeals for the Eleventh,
Sixth, and Ninth Circuits have already adopted Sibley standing
iii
explicitly. The Texas Supreme Court after interpreting federal case law
explicitly adopted Sibley standing for analogous state law claims under
Chapter 21 of the Texas Labor Code. NME Hospitals, Inc. v. Rennels,
994 S.W.2d 142, 146 (1999). Finally, federal district courts in the Fifth
Circuit already analyze Sibley standing under Title VII.
II.
What contracts are subject to 42 U.S.C. § 1981 and may VHS be
held liable under § 1981 for third-party interference in his contract with
PICCS? Under the Physician Agreement between VHS and Dr. Perry,
VHS agreed to allow Dr. Perry to perform services at North Central
Baptist Hospital in exchange for, among other things, Dr. Perry’s
agreement to be subject to all bylaws, rules and regulations of VHS as
well as the terms of a contract between PICCS and VHS. Contrary to the
broad scope of § 1981, the District Court held such an agreement was not
subject to § 1981. Further, contrary to Fifth Circuit case law, the District
Court held that there was no § 1981 liability for third party
interreference in Dr. Perry’s contract with PICCS.
iv
TABLE OF CONTENTS
Certificate of Interested Parties ................................................................ii
Request for Oral Argument ...................................................................... iii
Table of Authorities .................................................................................viii
Statement of Jurisdiction ........................................................................... 1
Issues Presented ......................................................................................... 2
Statement of the Case ................................................................................ 3
Summary of the Argument ......................................................................... 7
I. VHS is liable to Dr. Perry for its violations of Title VII under Sibley
standing as well as because it is a single, integrated enterprise and
joint employer with VHS. .................................................................. 7
II. Because VHS has both a contractual relationship with Dr. Perry
and interfered in his contractual relationship with PICCS,
summary judgment on the § 1981 claims against VHS must be
reversed. ............................................................................................. 9
Argument .................................................................................................. 11
I. The standard of review for summary judgment is de novo. .......... 11
II. VHS is subject to Dr. Perry’s Title VII discrimination claims

because it is an employer under Title VII and interfered in Dr.
Perry's employment opportunities with PICCS. ............................ 12
A. This Court should explicitly adopt Sibley and hold that an

employer may be liable for Title VII discrimination if it interfered
with the employment opportunities of an individual even if there
is no direct employment relationship. ......................................... 13
v
B. Because VHS, a Title VII employer, interfered with Dr. Perry’s

employment opportunities with PICCS, summary judgment on
the VHS Title VII discrimination claims must be reversed. ...... 17
III. Summary judgment must be reversed on all of Dr. Perry’s Title VII
claims against VHS because the District Court overlooked two key
pieces of evidence showing that VHS and PICCS are a single,
integrated enterprise. ...................................................................... 19
IV. Under Burton v. Freescale Semiconductor, VHS and PICCS are

joint employers. ............................................................................... 23
A. The District Court properly found a fact issue regarding whether

Dr. Perry was an employee of PICCS. ......................................... 25
B. Under Burton v. Freescale Semiconductor, VHS is a joint

employer with PICCS. .................................................................. 27
C. The District Court relied on erroneous and irrelevant facts in

determining that VHS’ ability to demand Dr. Perry’s termination
was too limited to establish a joint employment relationship with
PICCS. ........................................................................................... 32
1.Contrary to the District Court’s opinion, VHS could demand that

any PICCS physician be removed for any conduct it deemed was
not in VHS’ best interest and require that PICCS terminate all
employment and professional relationships with that physician. .
.................................................................................................... 33
2.It is irrelevant and misleading to say that VHS did not have the
power to terminate Dr. Perry because even after his termination,
he retained medical privileges. .................................................... 35
3.Dr. Perry’s malpractice insurance was not renewed in March 2017

because he had already been terminated and it was decided that
his last day would be February 28, 2017. ................................... 37
vi
V. Summary judgment must be reversed on Dr. Perry’s § 1981

discrimination and retaliation claims against VHS because he had
a contractual relationship with VHS and, even if he did not, VHS’
interference in his PICCS contract is actionable under § 1981. ... 39
A. Because Perry has a contractual relationship with VHS, he may

maintain a § 1981 claim against VHS. ........................................ 39
B. Even if Dr. Perry's Physician Agreement is not a contract, Fifth

Circuit precedent is well-established that third party interference
in a contract is subject to § 1981 liability.................................... 42
Conclusion ................................................................................................. 44
Certificate of Service................................................................................. 44
Certificate of Compliance ......................................................................... 45
vii
TABLE OF AUTHORITIES
Cases
Bloom v. Bexar County, Tex.,

130 F.3d 722 (1997) ......................................................................... iii, 13
Burton v. Freescale Semiconductor, Inc.,

798 F.3d 222 (5th Cir. 2015) ........................................... 9, 24, 25, 27, 32
Christopher v. Stouder Memorial Hosp.,

936 F.2d 870 (6th Cir. 1991) ................................................................. 15
Daniels v. Allied Elec. Contractors, Inc.,

847 F.Supp. 514 (E.D. Tex. 1994) ......................................................... 16
Daughtrey v. Honeywell, Inc.,

3 F.3d 1488 (11th Cir. 1993) ................................................................. 27
Douglas v. University of Chicago,

619 Fed.Appx 556 (7th Cir. 2015) ......................................................... 15
Ehret v. State of La.,

862 F.Supp. 1546 (E.D. La. 1992) ......................................................... 16
Fadeyi v. Planned Parenthood Assoc. of Lubbock, Inc.,

160 F.2d 1048 (5th Cir. 1998) ......................................................... 10, 40
Faraca v. Clements,
506 F.2d 956 (5th Cir. 1975) ........................................................... 10, 43
Gomez v. Alexian Bros. Hosp. of San Jose,

698 F.2d 1019 (9th Cir. 1983) ............................................................... 15
Haire v. Bd. of Supervisors of La. State Univ. Agric. & Mech. Coll.,
719 F.3d 356 (5th Cir. 2013) ................................................................. 11
Heinsohn v. Carabin & Shaw, P.C.,

832 F.3d 224 (5th Cir. 2016) ................................................................. 12
viii
McCorvey v. Univ. of Texas. Health Sci. Ctr. at San Antonio,

No. 5:16-cv-631, 2016 WL 8904949 (W.D. Tex. Dec. 21, 2016)............ 16
NME Hospitals, Inc. v. Rennels,

994 S.W.2d 142 (1999) ................................................................ iv, 16, 17
Reeves v. Sanderson Plumbing Products, Inc.,

530 U.S. 133 (2000) ................................................................................ 12
Sibley Memorial Hospital v. Wilson,

488 F.2d 1338 (1978) ............................................. iii, 7, 8, 12, 13, 15, 19
Sullivan v. Little Hunting Park, Inc.,

396 U.S. 229 (1969) ................................................................................ 43
Tillman v. Wheaton-Haven Recreation Assoc., Inc.,

410 U.S. 431 (1973) ................................................................................ 41
Tolan .v Cotton,
134 S.Ct. 1861 (2014)................................................................. 11, 12, 30
Trevino v. Celanese Corp.,

701 F.2d 397 (5th Cir. 1983) ....................................................... 8, 19, 20
United States v. Hoffman,

901 F.3d 523 (5th Cir. 2018) ................................................................. 11
Webster v. Fulton County,

283 F.3d 1254 (11th Cir. 2002) ............................................................. 39
Young v. Equifax Credit Info. Servs., Inc.,

294 F.3d 631 (5th Cir. 2002) ................................................................. 11
Zaklama v. Mt. Sinai Med. Ctr.,

842 F.2d 291 (11th Cir. 1988) ............................................................... 15
ix
Statutes
28 U.S.C. § 1291 .......................................................................................... 1
28 U.S.C. § 1331 .......................................................................................... 1
28 U.S.C. § 1367 .......................................................................................... 1
42 U.S.C. § 1981 ........................................................................... iv, 2, 9, 39
42 U.S.C. § 2000e-3 ................................................................................... 15
Other Authorities
Fifth Cir. Pattern Jury Instructions ........................................................ 11
x
STATEMENT OF JURISDICTION
The District Court had original subject matter jurisdiction over this
case under 28 U.S.C. § 1331 because this action is for violations of Title
VII and 42 U.S.C. § 1981.
This Court has jurisdiction under 28 U.S.C. § 1291, being an appeal
from a trial court’s final dismissal of all claims against VHS. Final
judgment on the VHS claims was entered on March 31, 2020. ROA.10 at
entry 75. Notice of Appeal was timely filed on April 29, 2020. ROA.10 at
entry 77.
1
ISSUES PRESENTED
ISSUE ONE: An employer may be held liable through Title VII, even
in the absence of a direct employment relationship with
an individual, if it had control over final employment
decisions related to the individual. Here, the record
evidence shows that VHS and PICCS made the decision
to terminate Dr. Perry. May Dr. Perry hold VHS liable
under Title VII?
ISSUE TWO: 42 U.S.C. § 1981 prohibits race discrimination in the
performance of contracts. VHS entered into a contract
with Dr. Perry that allowed him to provide services at
North Central Baptist Hospital. Is this contract subject
to § 1981’s prohibition of race discrimination?
ISSUE THREE: Under Fifth Circuit precedent, interference with
contracts subjects third parties to liability under 42
U.S.C. § 1981. Here, VHS interfered in Dr. Perry’s
contract with PICCS by terminating him because of his
race and reports of race discrimination. Is VHS subject
to § 1981 for this interference?
2
STATEMENT OF THE CASE
Since the appealed order granting summary judgment for VHS
related only to the threshold issues of whether Dr. Perry was an
employee, whether VHS was subject to Dr. Perry’s Title VII claims, and
whether VHS and PICCS are a single integrated enterprise or joint
employers, this statement of the case is limited only to the necessary facts
for those issues.
On March 1, 2015, Pediatric Inpatient Critical Care Services, P.A.
(PICCS) entered into an agreement to provide Pediatric Intensive Care
Department Coverage with VHS San Antonio Partners, LLC d/b/a North
Central Baptist Hospital (VHS, NCBH, or Hospital). ROA.1200. Under
that agreement, VHS retained substantial involvement and supervisory
authority over the people who worked for PICCS.
Under the terms of the agreement, VHS supervised PICCS and its
employees in at least the following ways:
• VHS had final approval over who PICCS could select as the
Director of the Pediatric Intensive Care Unit (PICU).
ROA.1202.
• VHS required the Director of PICCS to work exclusively for
3
the VHS. ROA.1202.
• VHS required all PICCS physicians to be able to perform
certain services, have certain qualifications, and submit
certain records to VHS. ROA.1201. The records submitted to
VHS then became the exclusive personal property of VHS,
which VHS then permitted the PICCS employees to access.
ROA.1201 at ¶ d.
• VHS maintained some control over the compensation of the
PICCS physicians. Under the agreement, PICCS was
required to pay all of its physicians “fair market value.”
ROA.1202.
• VHS also required all PICCS physicians to be subject to all
rules, regulations, and policies of VHS in addition to the
Medical Staff Bylaws. ROA.1201 at ¶ e.
• Most importantly, VHS had the power and authority to
demand that any PICCS physician be removed if in VHS’ own
judgment “conduct by the Group or any Physician . . . could .
. . be prejudicial or adverse to the best interest and welfare of
Hospital or its patients . . . .” ROA.1204 at ¶ b. (emphasis
4
added). PICCS had to comply with that request or the entire
agreement could be ended immediately. ROA.1204 at ¶ b.
On March 17, 2017, Dr. Melvin Perry entered into a Professional
Services Agreement with PICCS. ROA.1218. As one of the requirements
of that Professional Services Agreement, Dr. Perry entered into a second
employment contract with VHS on March 26, 2015. ROA.1217. Under
the terms of both contracts, Dr. Perry was subject to supervision by
PICCS and VHS. ROA.1219 at ¶ c; ROA.1220 at ¶ 6; ROA.1217.
Specifically, among other things, under the terms of the employment
agreements:
• PICCS had the ability to schedule Dr. Perry. ROA.1218
(“Physician agrees to provide call coverage . . . on a schedule
as determined by Association . . . .”). PICCS did in fact
schedule Dr. Perry. ROA.1042, page 73:21-22 (“The schedule
came – There was never a ‘template’ or ‘proposed.’ It just came
from Chavez.”).
• PICCS required that Dr. Perry work exclusively for them and
required Dr. Perry to agree to a non-compete/non-solicitation
provision that lasted a year after the contract ended.
5
ROA.1220; ROA.1225-27.
• The employment contract could be terminated by either party
at any time for any reason. ROA.1223.
• In the contract between Dr. Perry and VHS, VHS agreed to
allow Dr. Perry to perform services at North Central Baptist
Hospital if Dr. Perry agreed to, among other things, be subject
to all terms and conditions of the Coverage Agreement, that
VHS can enter into exclusive agreements with other
companies after the Coverage Agreement ends, and if Dr.
Perry follows all “Bylaws, Rules, and Regulations of Hospital.”
ROA.1217.
On January 9, 2017, Dana Kellis, a Hospital employee, met with
Dr. Chavez, Dr. Gowan, and Dr. Carvajal, who all work for PICCS.
ROA.1527. During that meeting both VHS and PICCS decided to
terminate Dr. Perry without cause. ROA.1527.
On January 12, 2017, Dr. Perry was terminated. His last day was
February 28, 2017. ROA.1136.
6
SUMMARY OF THE ARGUMENT
Summary judgment must be reversed on all of the Title VII and §
1981 claims against VHS. Under applicable federal precedent, the record
evidence creates at least a fact issue regarding whether VHS is a Title
VII employer liable to Dr. Perry for its actions. Regarding the § 1981
claims, the record evidence shows that VHS both had a contractual
relationship with Dr. Perry and that VHS interfered in with the contract
between Dr. Perry and PICCS when it demanded that Dr. Perry be
terminated.
I. VHS is liable to Dr. Perry for its violations of Title VII under
Sibley standing as well as because it is a single, integrated
enterprise and joint employer with VHS.
The District Court erroneously held that VHS was not an employer
under Title VII for purposes of Dr. Perry’s Title VII claims. Summary
judgment must be reversed for three reasons.
First, under well-established Sibley standing, a Title VII
discrimination claim does not require a direct employment relationship
between the plaintiff and the employer as long as the employer meets the
Title VII definition of “employer” and interfered with the plaintiff’s
employment opportunities. Sibley Memorial Hospital v. Wilson, 488 F.2d
7
1338, 1341 (1978). Here, VHS is a Title VII employer and interfered with
Dr. Perry’s employment opportunities with PICCS when it demanded
that Dr. Perry be terminated. ROA.734 (Admitting VHS is a Title VII
employer); ROA.747 (admitting that VHS demanded that Dr. Perry be
removed from the Hospital).
Second, VHS is a single, integrated enterprise with PICCS. Under
this Court’s precedent, VHS is a single, integrated enterprise with PICCS
if there a high level of business interrelation between VHS and PICCS,
and VHS made final employment decisions for the plaintiff. See Trevino
v. Celanese Corp., 701 F.2d 397, 403-04 (5th Cir. 1983). Here, VHS
essentially admits to a high level of interrelation when it conceded that
PICCS was necessary to VHS’ business running North Central Baptist
Hospital since under Texas law, hospital may not directly employ
physicians. See ROA.735 (discussing prohibition on directly employing
physicians); ROA.741 (admitting physicians are necessary to the
business of NCBH and any hospital). Further, VHS made the final
employment decision regarding terminating Dr. Perry. ROA.747.
Third, VHS is a joint employer with PICCS. Under Burton v.
Freescale Semiconductor, if an entity supervisees performance, provides
8
coaching and can demand termination of an individual then it is an
employer under Title VII. Burton v. Freescale Semiconductor, Inc., 798
F.3d 222, 227-28 (5th Cir. 2015). Here, the record evidence shows that
VHS does all of those things. See ROA.1528 (VHS’ EEOC position
statement admitting that they coached Dr. Perry and engaged in efforts
to correct his behavior) ROA.1204 (Coverage agreement providing VHS
the ability to demand termination of any physician).
Based on those three theories of liability, summary judgment on Dr.
Perry’s VHS claims must be reversed.
II. Because VHS has both a contractual relationship with Dr.

Perry and interfered in his contractual relationship with
PICCS, summary judgment on the § 1981 claims against VHS
must be reversed.
The District Court held that Dr. Perry’s Physician Agreement is not
a contract subject to § 1981 and that the Fifth Circuit does not allow §
1981 claims against third parties who interfere in a contractual
relationship. Under this Court’s precedent, both of these rulings must be
reversed.
First, § 1981 covers all contracts. 42 U.S.C. § 1981. Here, VHS, in
writing, agreed to allow Dr. Perry to perform services at North Central
Baptist Hospital if he agreed to certain terms and conditions. ROA.1217.
9
Dr. Perry, in writing, agreed to those terms and conditions. ROA.1217.
In terms of a contractual relationship, there is no meaningful distinction
between the VHS Physician Agreement and at-will employment, which
this Court has repeatedly held to be a contractual relationship subject to
§ 1981. See Fadeyi v. Planned Parenthood Assoc. of Lubbock, Inc., 160
F.2d 1048, 1051 (5th Cir. 1998). Because Dr. Perry had a contractual
relationship with VHS, summary judgment on his § 1981 claims must be
reversed.
Second, even if the Physician Agreement was not a contract, this
Court holds that third-party interference in a contractual relationship is
actionable under § 1981. See Faraca v. Clements, 506 F.2d 956, 959 (5th
Cir. 1975). Here, at the very least, VHS interfered in Dr. Perry’s
contractual relationship with PICCS. Under the Coverage Agreement, if
VHS demanded that Dr. Perry be terminated, PICCS had to sever all
employment and professional relationships with him. ROA.1204. It is
undisputed that VHS demanded Dr. Perry be terminated. See ROA.
1529. Therefore, under Faraca, Dr. Perry may bring a t § 1981 claim
against VHS.
Summary judgment must be reversed on the claims against VHS.
10
ARGUMENT
I. The standard of review for summary judgment is de novo.
This Court reviews de novo a trial court’s grant of summary
judgment. Haire v. Bd. of Supervisors of La. State Univ. Agric. & Mech.
Coll., 719 F.3d 356, 362 (5th Cir. 2013).
“[T]he testimony of a single witness is sufficient to prove any fact,
even if a greater number of witnesses testified to the contrary.” Fifth Cir.
Pattern Jury Instructions 3.4; see also United States v. Hoffman, 901 F.3d
523, 546-47 (5th Cir. 2018). Therefore, summary judgment is only
appropriate where, “after adequate opportunity for discovery, the
pleadings, depositions, answers to interrogatories, and admissions on
file, together with any affidavits filed in support of the motion, show that
there is no genuine issue as to any material fact and that the moving
party is entitled to judgment as a matter of law.” Young v. Equifax Credit
Info. Servs., Inc., 294 F.3d 631, 634 (5th Cir. 2002).
This Court must view the evidence in the light most favorable to
the non-movant. Tolan .v Cotton, 134 S.Ct. 1861, 1866 (2014). This
Court must also draw all reasonable inferences in favor of the non-
11
movant and may not make credibility determinations or weigh the
evidence. Id.
This Court “must take care not to define a case’s context in a
manner that imports genuinely disputed factual propositions.” Id.
Finally, this Court “must disregard all evidence favorable to the
moving party that the jury is not required to believe.” Heinsohn v.
Carabin & Shaw, P.C., 832 F.3d 224, 245 (5th Cir. 2016) (emphasis in
original); Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133, 151
(2000).
II. VHS is subject to Dr. Perry’s Title VII discrimination claims

because it is an employer under Title VII and and interfered
in Dr. Perry's employment opportunities with PICCS.
The District Court erred when it held that VHS was not an
employer for purposes of Dr. Perry’s Title VII discrimination claims
because a direct employment relationship is not required for Title VII
liability. See Sibley Memorial Hospital v. Wilson, 488 F.2d 1338, 1341
(1978).
12
A. This Court should explicitly adopt Sibley and hold that an

employer may be liable for Title VII discrimination if it
interfered with the employment opportunities of an
individual even if there is no direct employment
relationship.
In Bloom v. Bexar County, Tex., this Court stated that there is a
“possibility that a plaintiff may maintain an action against a defendant
who is not, technically, the plaintiff’s direct employer . . . .” 130 F.3d 722,
725 n. 2 (1997). However, the Court declined to adopt “Sibley standing”
at that time. Id. Since Bloom, the Fifth Circuit has not addressed Sibley.
But as shown below, several sister Courts of Appeal, the Texas Supreme
Court and district courts within the Fifth Circuit already apply Sibley’s
reasoning in determining whether or not suit may be maintained under
Title VII. The Fifth Circuit, like the Texas Supreme Court, should
explicitly adopt Sibley’s interference theory of employment
discrimination.
In Sibley, the D.C. Circuit Court of Appeals analyzed the plain text
of Title VII’s prohibition on employment discrimination in light of the
stated purpose of the statute. Sibley, 488 F.2d at 1341. The D.C. Circuit
found that the plain meaning of the text prohibited interference by an
13
employer in the employment opportunities of an individual. Id.
Specifically, the D.C. Circuit reasoned as follows:
The Supreme Court has said that the Congressional objective

in Title VII is plain from the language of the statute,” and that
it is “to achieve equality of employment opportunities . . . .
To permit a covered employer to exploit circumstances

peculiarly affording it the capability of discriminatorily
interfering with an individual’s employment opportunities
with another employer, while it could not do so with respect
to employment in its own service, would be to condone
continued use of the very criteria for employment that
Congress has prohibited.
A fair reading of the Act in the light of its stated purposes

precludes such a result. Section 703(a)(1) provides that:
(a) It shall be an unlawful employment practice for

an employer–
(1) to fail or refuse to hire or to discharge any

individual, or otherwise to discriminate against
any individual with respect to his compensation,
terms, conditions, or privileges of employment,
because of such individual’s . . . sex. . . .
The Act defines “employee” as “an individual employed by an

employer,” but nowhere are there words of limitation that
restrict references in the Act to “any individual” as
comprehending only an employee of an employer. Nor is there
any good reason to confine the meaning of “any individual” to
include only former employees and applicants for
employment, in addition to present employees. Those words
should, therefore, be given their ordinary meaning so long as
that meaning does not conflict with the manifest policy of the
Act.
14
Id. at 1340-41.
This plain reading of the statute is bolstered by the fact that the
anti-retaliation provision of Title VII explicitly states that retaliation by
an employer “against any of his employees or applicants for employment”
is prohibited. See 42 U.S.C. § 2000e-3(a). By contrast, Congress
obviously intended broader coverage in its prohibition of discrimination
by using the term “any individual” instead of “employee.” See Sibley, 488
F.2d at 1341.
Several Courts of Appeal have explicitly adopted this plain reading
of Title VII. See e.g., Christopher v. Stouder Memorial Hosp., 936 F.2d
870, 875 (6th Cir. 1991); Gomez v. Alexian Bros. Hosp. of San Jose, 698
F.2d 1019, 1020 (9th Cir. 1983); Zaklama v. Mt. Sinai Med. Ctr., 842 F.2d
291, 294 (11th Cir. 1988).1
Further, the Texas Supreme Court, in a well-reasoned opinion,
unanimously adopted this view of Title VII when applying it to an
analogous statute in the Texas Labor Code:
We agree with Sibley and the cases following it that Title VII
does not require a direct employment relationship between
1However, there is a Circuit split on the issue. See Douglas v. University of Chicago,
619 Fed.Appx 556, 557 (7th Cir. 2015) (recognizing circuit split and collecting cases
on both sides of the issue).
15
the parties. Thus, in order to harmonize federal and state

common law, we conclude that a plaintiff may likewise
maintain standing under the Texas Act in the absence of a
direct employment relationship with the defendant by
meeting the Sibley requirements. Section 21.055 does not
expressly require an employment relationship between the
employer who violates the statute and the person who is
harmed by the violation.
NME Hospitals, Inc. v. Rennels, 994 S.W.2d 142, 146 (Tex. 1999).2
Finally, district courts within the Fifth Circuit already apply
Sibley’s plain reading of Title VII discrimination coverage to employers.
See Daniels v. Allied Elec. Contractors, Inc., 847 F.Supp. 514, 519 (E.D.
Tex. 1994) (finding Sibley standing); Ehret v. State of La., 862 F.Supp.
1546, 1551 (E.D. La. 1992) (holding that the Association of River Pilots
was not a Title VII “employer” and declining to apply Sibley on that
basis); McCorvey v. Univ. of Texas. Health Sci. Ctr. at San Antonio, No.
5:16-cv-631, 2016 WL 8904949 at *17 (W.D. Tex. Dec. 21, 2016) (applying
the “well-established Sibley test” and finding that there was not
sufficient interference to invoke Sibley standing).
2 At the time the Rennels case was decided, the Texas Supreme Court consisted of
Justices Priscilla R. Owen, Greg Abbott, Nathan Hecht, Alberto R. Gonzales, Thomas
Philips, Harriet O’Neill, Deborah Hankinson, James A Baker, Craig Enoch. See
“Supreme Court History,” available at www.txcourts.gov/supreme/about-the-court/court-
history/, last visited July 7, 2020.
16
Since this Court stated in Bloom that applicable precedent adopted
by the Fifth Circuit does not “rule out the possibility that a plaintiff may
maintain an action against a defendant who is not, technically, the
plaintiff’s employer,” and district courts in this Circuit already apply
Sibley, this Court should explicitly adopt the well-established Sibley test.
B. Because VHS, a Title VII employer, interfered with Dr.

Perry’s employment opportunities with PICCS, summary
judgment on the VHS Title VII discrimination claims must
be reversed.
To maintain Sibley standing, a plaintiff must show that (1) the
defendant is an employer within Title VII, (2) that some sort of
employment relationship exists between the plaintiff and a third party,
and (3) that the defendant interfered with access to the plaintiff’s
employment opportunities. See Rennels, 994 S.W.2d at 147.
Here, each of those elements is easily met. First, VHS is an
employer under Title VII:
Q (BY MR WALSH) okay. So I want to ask you about

Definition B, the term “employer.” Would NCBH [VHS]
qualify as an employer under that definition?
...
THE WITNESS: It sounds like we’re an employer based on

that definition.
17
ROA.734, page 15:1-25. Second, Dr. Perry had an employment
relationship with PICCS, a third party. See ROA.1679-85 (“[M]aterial
fact issues concerning some of the underlying facts preclude summary
judgment on the issue of whether Plaintiff had an employment
relationship with PICCS.”).
Finally, the record evidence shows that VHS interfered in Dr.
Perry’s employment opportunities with PICCS. Specifically, according to
the Coverage Agreement between VHS and PICCS, VHS could demand
removal of any PICCS physician if, in its own judgment, VHS determined
that “conduct by the Group or any Physician . . . could . . . be prejudicial
or adverse to the best interest and welfare of Hospital or its patients . . .
.” ROA.1204. If VHS made that demand, PICCS was required to
“immediately terminate[e] all employment and other Group-based
professional relationships with such Physician and prevent[] said
Physician from providing any Services” under the Coverage Agreement.
ROA.1204. In January 2017, VHS made such a demand to PICCS to
remove Dr. Perry and PICCS complied. ROA.747, page 67:12-24.
According to VHS’ EEOC position statement, VHS “elected to inform
PICCS that it did not wish to have [Dr. Perry] assigned to the Hospital.”
18
ROA.1529. Therefore, VHS interfered with Dr. Perry’s employment
opportunities with PICCS.
Under Sibley’s plain reading of Title VII, VHS is liable to Dr. Perry
through Title VII if VHS demanded that Dr. Perry be removed because
of his race or sex. See Sibley, 488 F.2d at 1341.
Summary judgment regarding Dr. Perry’s Title VII discrimination
claims against VHS must be reversed
III. Summary judgment must be reversed on all of Dr. Perry’s

Title VII claims against VHS because the District Court
overlooked two key pieces of evidence showing that VHS and
PICCS are a single, integrated enterprise.
Under Fifth Circuit precedent, VHS is part of a single integrated
enterprise with PICCS, which makes both entities employers under Title
VII.
In Trevino v. Celanese Corp., the Fifth Circuit analyzed what made
two companies a single, integrated enterprise for purposes of Title VII.
Trevino v. Celanese Corp., 701 F.2d 397, 403-04 (5th Cir. 1983). In
Trevino, this Court set out four factors: (1) interrelation of operations, (2)
centralized control of labor operations, (3) common management, and (4)
common ownership or financial control. Id. at 404. This four-factor test
19
has been reduced down to “what entity made the final decisions regarding
employment matters related to the person claiming discrimination.” Id.
Here, the District Court carefully analyzed this Court’s precedent
and the record evidence before concluding that “[a]lthough close” VHS
and PICCS are not a single, integrated enterprise. ROA.1690. According
to the District Court, there was not the requisite degree of interrelation
in daily employment matters to be a single enterprise. ROA.1690.
However, in reaching that conclusion, the Court overlooked two key
pieces of evidence showing how truly interrelated VHS and PICCS really
are.
The first key piece of evidence overlooked is that PICCS and VHS’
business operations are so interrelated that both are necessary for the
other to exist. During his deposition, Bill Waechter, president of VHS
d/b/a NCBH, conceded that PICCS physicians are necessary to the
business of VHS:
Q. Would you agree that the doctors or physicians employed

by PICCS and working at NCBH under this agreement . . . are
necessary to the business of the hospital?
...
A. Yes. I think it’s—we have to have physicians take care

of patients.
20
ROA.741, pages 42-43. This interrelation and dependence on each other
is further confirmed by the fact that not only is there a contract between
VHS and PICCS for PICCS to provide exclusive services to VHS, but VHS
also required PICCS to “expressly agree[]” to force every single PICCS
physician to sign a separate contract directly with VHS stating that the
physician will follow all of VHS’ rules. See ROA.1202 at f (“Group will
cause each Physician . . . to execute the Physician Agreement . . . .”).
The second key piece of evidence overlooked by the District Court
is VHS’ Statement of Position to the EEOC. According to VHS’ position
statement, “members of the nursing staff were concerned about [Dr.
Perry’s] over-involvement with and communication with the mother of a
patient . . . They voiced their concerns to the Hospital . . . .” ROA.1529.
VHS, the Hospital, not PICCS, then approached Dr. Perry about these
concerns. ROA.1529. Then VHS, not PICCS, engaged in “coaching and
other efforts to impress upon [Dr. Perry] the need to improve his
conduct.” ROA.1529. Moreover, when Dr. Perry reported his own
discrimination at North Central Baptist Hospital, it was VHS, not
PICCS, that investigated the reports: Dr. Perry “complained to the
21
Hospital about what he perceived as race discrimination. The Hospital
investigated . . . .” ROA.1529.
The above overlooked evidence should be added to the evidence the
District Court already found indicating a single, integrated enterprise:
(1) VHS being given approval over who could be selected as

the Director of the PICU and requiring that the Director work
exclusively for the Hospital; (2) requiring the PICCS
physicians to be able to perform certain services, have certain
qualifications, and submit certain records to the Hospital,
which then became the exclusive property of the Hospital; (3)
requiring PICCS to pay physicians “fair market value;” (4)
requiring PICCS physicians to be subject to all rules,
regulations, and policies of the Hospital; and (5) retaining
power and authority to demand that any PICCS physician be
removed, with which PICCS had to comply. Further, it
appears that the Hospital had some involvement in
determining that “a minimum of 3 full time Physicians will be
necessary.”
ROA.1689-90. Between the overlooked evidence and the five additional
pieces of evidence found by the District Court, the facts in this case easily
move from being “close” to creating a fact issue from which the jury could
find a single integrated enterprise under the applicable Fifth Circuit case
law.
Finally, even if the above was not enough, the answer to Trevino’s
basic question of “what entity made the final decisions regarding
employment matters related to the person claiming discrimination” also
22
creates a fact issue and favors Dr. Perry. That is because the answer to
that question is that both VHS and PICCS made final employment
decisions together. ROA.1527. Here is an email from Dana Kellis, a VHS
employee, discussing the meeting with Dr. Gowan, Dr. Chavez, and Dr.
Carvajal, who each work for PICCS, where both entities decided to
terminate Dr. Perry together:
ROA.1527. That email alone creates a fact issue regarding a single,
integrated enterprise because it shows the first three factors of the single
enterprise and answers the critical question of who made the final
decisions related to Dr. Perry’s employment.
Based on the above, under Trevino, VHS and PICCS constitute a
single integrated enterprise for purposes of Title VII.
IV. Under Burton v. Freescale Semiconductor, VHS and PICCS

are joint employers.
Even if VHS and PICCS are not considered a single, integrated
enterprise, they are at least considered joint employers for purposes of
23
Title VII. To establish an employment and joint employment
relationship, the Fifth Circuit uses the hybrid economic realities/common
law control test. Burton v. Freescale Semiconductor, Inc., 798 F.3d 222,
227 (5th Cir. 2015). However, the “emphasis on the common law control
test is dispositive.” Id. at 228.
Under Fifth Circuit precedent, the control test is as follows:
The right to control an employee’s conduct is the most

important component of this test, and we consider whether
the alleged employer has the right to hire and fire the
employee, the right to supervise the employee, and the right
to set the employee’s work schedule.
Id. at 227.
In Burton v. Freescale, defendant Freescale argued that it was not
an employer because it did not “handle payroll, withhold taxes, provide
benefits, workers compensation insurance, or set the terms and
conditions of employment” for the plaintiff. Id. at 227-228. Nevertheless,
the Fifth Circuit found an employment relationship because:
Freescale had the right to demand Burton’s termination from

the assignment. Freescale supervised Burton. Complaints
against her were made by Freescale personnel . . . . Freescale
employees completed performance reviews of Burton’s work.
On-the-job corrections and admonishment were delivered by
Freescale employees. Most fundamentally, it was Freescale
that decided and insisted that Burton be fired. Burton has
offered adequate evidence of an employment relationship.
24
Id. at 227.
Here, as shown below, the District Court properly found that a fact
issue exists regarding whether Dr. Perry was an employee of PICCS.
However, the District erred when it found that there was no joint
employment relationship between PICCS and VHS.
A. The District Court properly found a fact issue regarding

whether Dr. Perry was an employee of PICCS.
Here, the District Court correctly found that there was a fact issue
regarding whether Dr. Perry was an employee of PICCS. See ROA.1679-
85. The evidence the District Court analyzed concerning the hybrid test
and other record evidence showed fact issues regarding, among other
things, whether:
• PICCS had the power to set the terms and conditions of Dr.
Perry’s employment:
o Dr. Perry was required to submit to certain supervision
from PICCS. ROA.1684
o Dr. Perry was required to maintain a cell phone and to
report adverse actions to PICCS. ROA.1684.
o PICCS provided criteria to Dr. Perry, without
discussion, that he had to follow. ROA.1684. For
25
example, Dr. Chavez required certain medicines be
used. ROA.1684. PICCS required Dr. Perry to get
medical malpractice insurance from a particular
provider. ROA.1684.
o PICCS required Dr. Perry to accept all patients.
ROA.1050, page 107:12-18 (stating that Dr. Chavez told
him that “We absolutely cannot turn away patients.”).
• PICCS set Dr. Perry’s work schedule. ROA.1682
• PICCS prohibited Dr. Perry from working outside of PICCS
without prior approval. ROA.1680.
• PICCS directly paid Dr. Perry a salary and not by the job.
ROA.1680. In fact, PICCS required Dr. Perry to pay back part
of his salary if he did not do the shifts PICCS assigned him.
ROA.1051, page 110:18-22 (“[E]ven the contract talked about
if I didn’t do my . . . shifts, I had to pay for the replacement,
you know, for that, which is not usual . . . .”).
• PICCS billed patients for services Dr. Perry provided and Dr.
Perry could not set his own fees. ROA.1680.
26
As the District Court correctly found, “material fact issues
concerning some of the underlying facts preclude summary judgment on
the issue of whether Plaintiff had an employment relationship with
PICCS.” ROA.1685.3
B. Under Burton v. Freescale Semiconductor, VHS is a joint

employer with PICCS.
Applying the same reasoning that this Court applied in Burton v.
Freescale Semiconductor, there is more than sufficient evidence to
establish a fact issue regarding whether Dr. Perry had an employment
relationship with VHS.
As mentioned above, in Burton, this Court held that Freescale’s
right to demand termination and to supervise Burton provided “adequate
evidence of an employment relationship.” Burton, 798 F.3d at 227.
Here, there is the exact same evidence. First, VHS had the power
to fire Dr. Perry and used it. Specifically, NCBH President Waechter
3 Although not relied upon by the District Court due to it finding the other evidence
sufficient, the IRS SS-8 determination finding that Dr. Perry is an employee is also
relevant evidence of his employee status. An IRS SS-8 determination of employment
status along with a plaintiff’s testimony regarding control and/or supervision is
sufficient to create a fact issue regarding employment status that defeats summary
judgment. See Daughtrey v. Honeywell, Inc., 3 F.3d 1488, 1493 (11th Cir. 1993).
Here, the SS-8 describes all of the facts that the IRS relied on and why those facts
show that Dr. Perry was an employee under the common law control test, which is
the same test this Court uses. See ROA.1522-24.
27
“ultimately made the decision to terminate [Dr. Perry’s] ability to be able
to practice at the facility.” ROA.1031, page 31:21-22; ROA.1032, page
35:7-11. This fact is corroborated by the Coverage Agreement between
VHS and PICCS. Under the Coverage Agreement, VHS had the right to
demand Dr. Perry’s termination and PICCS had to comply or lose the
contract. ROA.1204 at ¶ b; see also ROA.1201 at ¶ b. Moreover,
according to VHS’ EEOC position statement, VHS “elected to inform
PICCS that it did not wish to have [Dr. Perry] assigned to the Hospital.”
ROA.1529. In other words, just like in Burton, most fundamentally, it
was VHS that decided and insisted that Dr. Perry be terminated.
ROA.1529.
Second, the record evidence shows that VHS supervised Dr. Perry.
The Coverage Agreement requires Dr. Perry to subject himself to
supervision by VHS d/b/a NCBH, by requiring him to be subject to VHS
policies including the Tenet Standards of Conduct and North Central
Baptist Hospital’s medical bylaws. ROA.1217 (Physician Agreement
required by VHS); ROA.1219 at 4 (requiring Dr. Perry to sign the VHS
Physician Agreement). The Tenet Standards of Conduct expressly apply
to everyone. ROA.1547. According to these standards, “[f]ailure to follow
28
Tenet’s policies and procedures will result in disciplinary action up to and
including termination.” ROA.1547. Therefore, VHS, by requiring Dr.
Perry to sign the professional services agreement and the Physician
Agreement, subjected Dr. Perry to supervision, discipline and
termination for failing to comply with policies, rules, and procedures.
ROA.1217; ROA.1219.
Here is a non-exclusive list of the ways this right to supervise Dr.
Perry manifested itself:
• VHS provided Dr. Perry with the equipment and facilities he
needed to perform his job. See ROA.1221.
• VHS coached him and engaged in other efforts to correct
perceived improper conduct by Dr. Perry. ROA.1529
• VHS employee Dana Kellis told Dr. Perry that if he received
any more complaints about Dr. Perry from VHS nurses, he
would be “terminated or removed.” ROA.1035, page 46:13-23.
• When Dr. Perry reported discrimination and retaliation, he
did so to VHS and VHS investigated. ROA.1529.
• NCBH President Waechter was directly involved in
communicating with the nurses on any issues involving Dr.
29
Perry. ROA.1031, page 31:19-21 (“He frequently
communicated directly with the nurses about any issues that
would be going on involving me and anyone else.”)
• President Waechter had the power to grant or deny privileges
to any physicians at VHS. ROA.1063, page 157:5-6 (“He
[Waechter] can give anybody privileges he wants to for any
reason he wants to.”).
• VHS employees including NCBH President Bill Waechter
interviewed Dr. Perry.4 ROA.1028, page 17:6-20.
• VHS could require Dr. Perry to treat certain patients over his
objections. ROA.1032, page 36:19-20 (“Administration
overruled us and sent that kid to North Central Baptist
anyway.”).
• VHS required Dr. Perry to be physically present on the NCBH
premises at certain times. ROA.1033, page 38:3-20 (“[T]hey
came up with this set of criteria—the hospital came up with,
where we had to stay in-house at night . . . There was not an
4 VHS disputes whether Waechter interviewed Dr. Perry and the District Court
credited testimony from employees and owners of VHS and PICCS over Dr. Perry’s
testimony. ROA.1698. At this stage, however, the District Court should have taken
as true Dr. Perry’s evidence over VHS and PICCS. See Tolan, 134 S.Ct. at 1866.
30
option.”).
• VHS required Dr. Perry to consult on every single patient in
the PICU, which took discretion away from the admitting
physician and the consulting physician. ROA.1035, pages 46-
47.
• VHS required Dr. Perry to enter orders electronically into the
system and instructed nurses not to enter orders
electronically. ROA.1036, page 51:4-8.
• VHS could also prohibit Dr. Perry from treating patients.
ROA.1037, page 54:15-16 (“I was not allowed to take care of
those two patients, per the hospital.”).
• VHS employees also set Dr. Perry’s sedation schedule.
ROA.1038, page 61:5-6 (“She handled the scheduling. That
was all handled through the hospital.”).
• VHS had the power to select the Director of the PICU.
ROA.1202 at ¶ 2.
• VHS had the power to prevent the hiring of Dr. Perry.
Specifically, VHS required PICCS to force Dr. Perry to sign a
Physician Agreement with VHS in order to work at North
31
Central Baptist Hospital. ROA.1030, page 25:21-23 (“But we
were told that it had—we had to sign it before we could—we
would have consideration from North Central Baptist.”).
The above facts provide even more evidence than what this Court
found “adequate evidence of an employment relationship” in Burton. See
Burton, 798 F.3d at 227. Based on the above, VHS and PICCS are joint
employers. Summary judgment on Dr. Perry’s Title VII claims against
VHS must be reversed.
C. The District Court relied on erroneous and irrelevant facts

in determining that VHS’ ability to demand Dr. Perry’s
termination was too limited to establish a joint
employment relationship with PICCS.
The District Court’s opinion erroneously waters down the scope of
VHS’ ability to fire and supervise physicians by crediting testimony from
PICCS over the plain language of the Coverage Agreement. ROA.1698-
99. The District Court relied on the irrelevant and misleading fact that
Dr. Perry retained medical privileges at VHS for a short period after his
termination. ROA.1699. Finally, the District Court misconstrued the
why and how of the nonrenewal of Dr. Perry’s medical malpractice
insurance, which is also irrelevant. ROA.1699.
32
1. Contrary to the District Court’s opinion, VHS could

demand that any PICCS physician be removed for any
conduct it deemed was not in VHS’ best interest and
require that PICCS terminate all employment and
professional relationships with that physician.
Regarding the right to demand termination, the District Court
states that VHS did not exercise the requisite amount of control because,
citing testimony from PICCS, it could only request removal of Dr. Perry
in rare and limited instances where Dr. Perry jeopardized patient care or
safety and such removal had to be done in accordance with the Medical
Staff Bylaws. ROA.1698-99. Further, the District Court argued that
VHS’ power to demand that a physician be removed was the same thing
as simply barring someone from the premises. Both of these contentions
are factually wrong according to the actual wording of the Coverage
Agreement.
First, the Coverage Agreement contains no such limitation on VHS’
ability to demand removal of a physician. Under section 6(b) of the
Coverage Agreement, VHS can demand removal of any physician for any
conduct it deems “could . . . be prejudicial or adverse to the best interests
and welfare of the Hospital or its patients.” ROA.1204. In other words,
the conduct does not even have to actually be or have been prejudicial or
33
adverse to VHS’ interests. That is practically at-will employment and is,
at least, substantially broader than the District Court’s characterization
of the removal power as only pertaining to when patient care or safety is
jeopardized. Compare ROA.1204 (Coverage Agreement) with ROA.1698
(Dist. Court. Op.). Further, contrary to the District Court’s opinion,
section 6(b) does not require that the removal of a physician be conducted
in accordance with the Bylaws or for a reason stated in the Bylaws.
ROA.1204. In fact, the actual

Case 5:18-cv-00404-XR language
Document of 10/02/19
59-2 Filed the Coverage
Page 6Agreement
of 17
provides no way for PICCS to refuse to fire a physician that VHS
demands be removed and not be in breach of its contract. ROA.1204.
Second, the Coverage Agreement allows VHS and requires PICCS

b. Immediate Termination by Hospital. Hospital may tem1inate this
to do much more than
Agreement immediately merely
by written barto aGroup
notice physician
upon the from North
occun-ence of anyCentral Baptist
of the following:
(i) conduct by Group or any Physicians which could affect the quality of professional care
provided to Hospital patients pursuant to the Medical Staff Bylaws, or be prejudicial or adverse
Hospital. Rather,
to the best interest the plain
and welfare language
of Hospital of the
or its patients; (ii) agreement
breach by Grouprequires PICCS
or any Physicians
of any of the confidentiality provisions hereof; (iii) failure by Group to maintain the insurance
required under this Agreement; (iv) closure of Hospital, cessation of the patient care operations
to or
not only terminate the employment of the physician, but to terminate
sale of Hospital or of all, or substantially all, of Hospital's assets; or (v) Group's or any
Physician's conviction of a criminal offense related to health care, or Group's or any Physician's
alllisting
professional
by a federalrelationships
agency as being with theexcluded
deban-ed, physician: or otherwise ineligible for federal
program participation.
Group may cure such breach caused by a Physician under this Subsection by immediately
tenninating all employment and other Group-based professional relationships with such
Physician and preventing said Physician from providing any Services hereunder.
c. Termination for Changes in Law. In the event that any govenunental or

ROA.1204. Not only orrequiring
nongovernmental agency, any court orthat a physician
administrative tribunal be terminated,
passes, but also
issues or promulgates
any new, or change to any existing, law, rule, regulation, standard, interpretation, order, decision
or judgment (individually or collectively, "Legal Event"), which a party (the "Noticing Party")
requiring
reasonablythat the(i)group
believes have
materially and no further
adversely professional
affects relationship
either party's licensure, with a
accreditation,
ce11ification, or ability to refer, to accept any referral, to present a bill or claim, or to receive
payment or reimbursement from any governmental or non-governmental payor, or (ii) indicates a
Legal Event with which the Noticing Party desires fm1her compliance, then, in either event; the
Noticing Pai1y may give the other party thirty 34(30) days prior written notice of its intent to
amend or tenninate this Agreement. Notwithstanding the foregoing, the Noticing Party may
propose an amendment to the Agreement to take into account the Legal Event, and, if accepted
physician is more than merely blocking the entrance to a building or
allowing access to the premises.
2. It is irrelevant and misleading to say that VHS did not

have the power to terminate Dr. Perry because even
after his termination, he retained medical privileges.
The District Court also held that VHS did not have the requisite
control over termination because even after it demanded that Dr. Perry
be removed, he still retained admitting privileges and the ability to treat
patients at North Central Baptist Hospital. ROA.1699.
This fact is irrelevant. Medical privileges are provided through and
governed by the Medical Staff Bylaws. See ROA.740, page 39:1-7. That
process is independent of the employment relationship and outside of a
termination decision. Indeed, as several of the cases cited in the District
Court’s opinion state, Medical Staff Privileges and Bylaws do not even
create a contractual relationship between a physician and a hospital. See
ROA.1710 (collecting cases stating that no contractual relationship exists
between a physician and a hospital based soley on the Medical Staff
Bylaws). Consider the following example: A state appellate judge fires
one of the staff attorneys working at the appellate court. However, even
after the termination, the staff attorney is still admitted to practice in
35
not only other state appellate courts, but also the very appellate court
she was fired from. That’s because her admission to the bar is
independent of her employment and can continue after specific
employment ends. It does not mean that the court lacked the authority
to fire the staff attorney.
It is also misleading to rely on this fact as a basis for saying VHS
lacked control over the employment of Dr. Perry. The fact is that VHS
and PICCS entered into an exclusive Coverage Agreement where the
PICCS physicians would be the exclusive providers to VHS of pediatric
intensive care services. ROA.1200 at ¶ 1(a). Dr. Perry is a Board-
Certified Pediatric Intensivist. ROA.1139. In fact, that’s why PICCS was
interested in hiring him. ROA.1138. When VHS demanded that PICCS
fire Dr. Perry and PICCS complied in order to maintain its contract as
VHS’ exclusive provider of pediatric intensive care, Dr. Perry then
became prohibited from providing pediatric intensive care at VHS under
the terms of the VHS/PICCS contract. See ROA.1200 (providing that
PICCS’ physicians will be the exclusive providers of service in the
pediatric intensive care unit).
36
3. Dr. Perry’s malpractice insurance was not renewed in

March 2017 because he had already been terminated
and it was decided that his last day would be February
28, 2017.
The District Court also reasons that the fact that Dr. Perry only lost
his privileges at VHS because his malpractice insurance was not renewed
in March is evidence that VHS did not have control over his employment.
That reasoning misunderstands the facts and, in any event, is irrelevant
to the issue of VHS’ control.
First, PICCS had a group medical malpractice plan that included
Dr. Perry. ROA.1039-40, pages 64-67. PICCS would pay the premiums
and then Dr. Perry would reimburse PICCS for it. ROA.1040, page 67:14-
17. The medical malpractice company was TMLT. ROA.1049, page
103:11. Dr. Perry was notified of his termination on January 12, 2017.
ROA.1093. The termination letter, which states he was being fired
without cause, provided Dr. Perry with 90 days’ notice. ROA.1093.
However, on February 28, 2017, PICCS through Dr. Chavez stated that
his last day would be in February. ROA.1136 The reason for that was so
that Dr. Perry would not have to renew his insurance on PICCS’ group
medical malpractice plan. See ROA.1136.
37
But that is all irrelevant anyway. The privileges issue and the
insurance issue are separate from whether or not Dr. Perry was fired by
VHS. It would be like arguing in the staff attorney example above that
the state appellate court did not have any control over the attorney’s
employment because at the time of her termination, her bar license was
still active. They are completely separate issues and have no bearing on
whether or not VHS had the ability to control Dr. Perry’s employment.
The answer to the question of whether or not VHS had control over
Dr. Perry’s employment is absolutely yes. As shown above, VHS had and
exercised the power to demand not only that Dr. Perry be fired by PICCS,
but also that PICCS sever all professional relationships with him.
ROA.1204. VHS did that with full knowledge that Dr. Perry would not
be able to provide the pediatric intensive care that he had spent his
professional life doing at VHS.
Summary judgment on Dr. Perry’s Title VII claims against VHS
must be reversed.
38
V. Summary judgment must be reversed on Dr. Perry’s § 1981

discrimination and retaliation claims against VHS because
he had a contractual relationship with VHS and, even if he
did not, VHS’ interference in his PICCS contract is
actionable under § 1981.
Section 1981 prohibits race discrimination and retaliation in the
making and enforcing of contracts. 42 U.S.C. § 1981(a). Under the
statute, the phrase “make and enforce contracts” includes “the making,
performance, modification, and termination of contracts, and the
enjoyment of all benefits, privileges, terms, and conditions of the
contractual relationship.” Id. at (b). Section 1981 applies equally to
independent contractor relationships as well. See Webster v. Fulton
County, 283 F.3d 1254, 1257 (11th Cir. 2002).
Here, even if Dr. Perry is not an employee and VHS is not a joint
employer, because Dr. Perry had a contractual relationship with VHS
and VHS interfered with his PICCS contract, his § 1981 claims against
VHS cannot be dismissed. Summary judgment must be reversed.
A. Because Perry has a contractual relationship with VHS, he

may maintain a § 1981 claim against VHS.
VHS and the District Court agreed that Dr. Perry’s § 1981 claims
should be dismissed against VHS because there was no contractual
relationship between the two. That ruling was error.
39
Specifically, the District Court erroneously held that the
contractual agreement between Dr. Perry and VHS to provide services to
the Hospital in exchange for submitting to all rules, regulations, and
bylaws of VHS, as well as various other things was not an enforceable
contract. ROA.1709. The District Court held that it was not enforceable
because Dr. Perry had already agreed to be bound by the rules,
regulations and bylaws of VHS in a separate contract between different
parties. ROA.1709 (“Perry already agreed in the PSA [between Dr. Perry
and PICCS. ROA.1218] to act consistently with all Bylaws of the medical
staff.”). The District Court does not cite any authority for that holding.
The District Court’s ruling must be reversed because Dr. Perry’s
Physician Agreement is a sufficient contractual relationship for purposes
of § 1981. Under § 1981, any contractual relationship is sufficient
because § 1981 covers all contracts. For example, at-will employment is
a contractual relationship subject to § 1981 even though an employer can
fire an employee for any reason or no reason at all. See Fadeyi v. Planned
Parenthood Assoc. of Lubbock, Inc., 160 F.2d 1048, 1051 (5th Cir. 1998).
Pool memberships and admission to private school are likewise
contractual relationships subject to § 1981. See Tillman v. Wheaton-
40
Haven Recreation Assoc., Inc., 410 U.S. 431, 439-40 (1973) (pool
membership); Runyon v. McCrary, 427 U.S. 160, 172 (1976) (admission
to private school).
Here, the Physician Agreement is easily as contractual as at-will
employment, pool membership, or education. According to the Physician
Agreement, “[i]n consideration of [Dr. Perry’s] approval by
Hospital to provide services at North Central Baptist Hospital . .
. [Dr. Perry] knowingly and voluntarily agree[s] to the following.”
ROA.1217 (emphasis added). The contract states exactly what Dr. Perry
agrees to in exchange for working at VHS. For example, Dr. Perry agrees
to be bound by “all terms and conditions of Agreement for Department
coverage dated December 12, 2014” and that he is not entitled to future
employment if the PICCS contract is cancelled. ROA.1217. Dr. Perry
also contractually agrees with VHS to be bound by and subject to “all
provisions of the Bylaws, Rules and Regulations of Hospital and/or its
Medical Staff.” ROA.1217. The contract even has a severance clause,
which implies that both parties envision the ability to legally enforce the
requirements. ROA.1217. In short, this is a contract to which § 1981
applies since it is like any other agreement to provide something of value
41
to one party (approval to work at VHS) in exchange for something of
value to the other party (agreement to be subject to the rules and
regulations of VHS).
None of the cases cited by VHS or the District Court reach a
different conclusion. All of those cases concern whether Medical Staff
Bylaws alone create a contractual relationship. Here, that is not an issue
because the Physician Agreement is a contract subject to § 1981.
Summary judgment on Dr. Perry’s § 1981 claims against VHS must
be reversed.
B. Even if Dr. Perry’s Physician Agreement is not a contract,

Fifth Circuit precedent is well-established that third party
interference in a contract is subject to § 1981 liability.
Even if the Physician Agreement is not a contract, summary
judgment must be reversed because it is well established that third party
interference with a contractual relationship subject to § 1981 is itself
subject to § 1981. The District Court’s rejection of this basis for § 1981
liability was also in error.
In 1975, this Court explicitly held that interfering with a contract
is actionable under § 1981:
The courts in their broad interpretation of Section 1981 and

1982 (both of these statutes are derived from Section 1 of the
42
Civil Rights Act of 1866, 14 Stat. 27) have held that a third
party’s interference with those rights guaranteed under
Sections 1981 and 1982 will subject such a person to personal
liability. . . . The Supreme Court’s ruling in Sullivan v. Little
Hunting Park, Inc., 396 U.S. 229, 237, 90 S.Ct. 400, 404, 24
L.Ed.2d 386 (1969) is controlling on this point. That action
concerned the appropriateness of a claim under Section 1982
which asserted an interference with the equal right to lease.
...
It would be logically inconsistent not to apply the Sullivan

interpretation with equal force to a suit for interference with
the right to contract guaranteed by Section 1981 since, as
mentioned previously, it is also derived from Section 1 of the
Civil Rights Act of 1866 and thus should enjoy the same broad
interpretation of its breadth of coverage.
Faraca v. Clements, 506 F.2d 956, 959 (5th Cir. 1975) (citations and
quotations omitted).
Here, VHS unquestionably interfered in Dr. Perry’s contract with
PICCS by demanding under the Coverage Agreement that PICCS
terminate him and prohibit him from providing any services to VHS. See
ROA. 1529. (“[VHS] elected to inform PICCS that it did not wish to have
[Dr. Perry] assigned to the Hospital.”). Therefore, under Faraca, VHS
is liable under § 1981.
43
CONCLUSION
For the foregoing reasons, this Court should reverse summary
judgment on all of Dr. Perry’s claims against VHS under both Title VII
and § 1981.
Respectfully Submitted,
/s/ Colin Walsh

Colin Walsh
Board Certified in Labor and
Employment Law by the Texas Board
of Legal Specialization
WILEY WALSH, P.C.

1011 San Jacinto Blvd, Ste 401
Austin, TX 78701
Telephone: (512) 271-5527
Facsimile: (512) 201-1263
colin@wileywalsh.com
ATTORNEY FOR APPELLANT
CERTIFICATE OF SERVICE
I, Colin Walsh, certify that today, July 13, 2020, a copy of the Initial
Brief of Appellant was served upon the following individuals at the
following email addresses for the Appellees via the Court’s ECF system:
Tiffany Cox Stacy, tiffany.cox@ogletree.com;
Kelly E. Preston, kelly.preston@ogletree.com
44
/s/ Colin Walsh

Colin Walsh
CERTIFICATE OF COMPLIANCE
Pursuant to Fed. R. App. P. 32(g), undersigned counsel certifies
that this brief complies with the type-volume limitations of Fed. R. App.
P. 32(a)(7)(B)(i).
1. Exclusive of the portions exempted by Fed. R. App. P. 32(f), this
brief contains 8,220 words printed in a proportionally spaced typeface.
2. This brief is printed in a proportionally spaced, serif typeface using
Century Schoolbook 14-point font in text and Century Schoolbook 12-
point font in footnotes produced by Microsoft Word.
3. Upon request, undersigned counsel will provide an electronic
version of this brief and/or a copy of the word printout to the Court.
4. Undersigned counsel understands that a material
misrepresentation in completing this certificate, or circumvention of the
type-volume limits in Fed. R. App. P. 32(a)(7)(B)(i), may result in the
Court’s striking this brief and imposing sanctions against the person who
signed it.
/s/ Colin Walsh

Colin Walsh
45

Appellant Brief - Perry v. VHS

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Appellant Brief - Perry v. VHS

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Case: 20-50356 Document: 00515486766 Page: 1 Date Filed: 07/13/2020

IN THE UNITED STATES COURT OF APPEALS

DOCTOR MELVIN G. PERRY, JR.,

VHS SAN ANTONIO PARTNERS, L.L.C., doing business as North

Appeal from the United States District Court

INITIAL BRIEF OF APPELLANT

WILEY WALSH, P.C.

CERTIFICATE OF INTERESTED PERSONS

The undersigned counsel of record certifies that the following listed

persons and entities as described in the fourth sentence of Rule 28.2.1

have an interest in the outcome of this case. These representations are

Dr. Melvin G. Perry, Jr. – Plaintiff/Appellant

Colin Walsh – Counsel for Plaintiff/Appellant

Wiley Walsh, P.C. – Counsel for Plaintiff/Appellant

VHS San Antonio Partners, L.L.C. – Defendant/Appellee

Tiffany Cox Stacy – Counsel for Defendant/Appellee

Kelly E. Preston – Counsel for Defendant/Appellee

Ogletree Deakins – Counsel for Defendant/Appellee

Pediatric Inpatient Critical Care Services, P.A. – Defendant

Angella Herbert Myers – Counsel for Defendant

Sharon S. Gilmore – Counsel for Defendant

Myers Law Group, LLP – Counsel for Trial Court Defendant

/s/ Colin Walsh

REQUEST FOR ORAL ARGUMENT

Appellant requests oral argument on two important matters:

Is a direct employment relationship required for Title VII liability?

is a “possibility that a plaintiff may maintain an action against a

defendant who is not, technically, the plaintiff’s direct employer . . . .”

addressed whether Sibley standing exists in this Circuit. This case

presents such an opportunity, as well as the opportunity to address what

is required to show a single integrated enterprise and a joint employer

In Sibley Memorial Hospital v. Wilson, the D.C. Circuit held that

Title VII does not require a direct employment relationship between an

found that if an “employer” as defined by Title VII interfered with the

employment opportunities of an individual with a third party, such action

Sixth, and Ninth Circuits have already adopted Sibley standing

Chapter 21 of the Texas Labor Code. NME Hospitals, Inc. v. Rennels,

Circuit already analyze Sibley standing under Title VII.

What contracts are subject to 42 U.S.C. § 1981 and may VHS be

VHS agreed to allow Dr. Perry to perform services at North Central

Baptist Hospital in exchange for, among other things, Dr. Perry’s

agreement to be subject to all bylaws, rules and regulations of VHS as

interreference in Dr. Perry’s contract with PICCS.

Certificate of Interested Parties ................................................................ii

Request for Oral Argument ...................................................................... iii

Table of Authorities .................................................................................viii

Statement of Jurisdiction ........................................................................... 1

Issues Presented ......................................................................................... 2

Statement of the Case ................................................................................ 3

Summary of the Argument ......................................................................... 7

I. The standard of review for summary judgment is de novo. .......... 11

II. VHS is subject to Dr. Perry’s Title VII discrimination claims

A. This Court should explicitly adopt Sibley and hold that an

B. Because VHS, a Title VII employer, interfered with Dr. Perry’s

IV. Under Burton v. Freescale Semiconductor, VHS and PICCS are

A. The District Court properly found a fact issue regarding whether

B. Under Burton v. Freescale Semiconductor, VHS is a joint

C. The District Court relied on erroneous and irrelevant facts in

1.Contrary to the District Court’s opinion, VHS could demand that

3.Dr. Perry’s malpractice insurance was not renewed in March 2017

V. Summary judgment must be reversed on Dr. Perry’s § 1981

A. Because Perry has a contractual relationship with VHS, he may

B. Even if Dr. Perry's Physician Agreement is not a contract, Fifth

Certificate of Compliance ......................................................................... 45