Texas Alcoholic Beverage Commission v. Earl Pearson

 ACCEPTED 15-25-00037-CV FIFTEENTH COURT OF APPEALS AUSTIN, TEXAS 7/14/2025 7:48 PM 15-25-00037-CV CHRISTOPHER A. PRINE CLERK FILED IN 15th COURT OF APPEALS IN THE COURT OF APPEALS AUSTIN, TEXAS FOR THE FIFTEENTH DISTRICT 7/14/2025 7:48:28 PM AUSTIN, TEXAS CHRISTOPHER A. PRINE Clerk TEXAS ALCOHOLIC BEVERAGE COMMISSION, Appellant-Defendant, v. EARL PEARSON, Appellee-Plaintiff. On Appeal from the 261st Judicial District Court, Travis County, Texas Trial Court Cause No. D-1-GN-18-001703 APPELLEE’S BRIEF APPELLEE HEREBY REQUESTS ORAL ARGUMENT John F. Melton Email: jmelton@jfmeltonlaw.com State Bar No. 24013155 THE MELTON LAW FIRM, P.L.L.C. 925 S. Capital of Texas Hwy, Suite B225 Austin, Texas 78746 (512) 330-0017 Telephone ATTORNEY FOR APPELLANT TABLE OF CONTENTS Page IDENTITIES OF PARTIES.......................................................................................3 INDEX OF AUTHORITIES .....................................................................................5 STATEMENT OF THE CASE..................................................................................6 STATEMENT REGARDING ORAL ARGUMENT................................................6 ISSUE PRESENTED.................................................................................................7 STATEMENT OF FACTS .......................................................................................7 SUMMARY OF THE ARGUMENT........................................................................8 ARGUMENT........................................................................................................ ....8 PRAYER..................................................................................................................15 ii IDENTITIES OF PARTIES AND COUNSEL PLAINTIFF: Earl Pearson APPELLANT COUNSEL FOR PLAINTIFF: John F. Melton State Bar No. 24013155 Email: jmelton@jfmeltonlaw.com The Melton Law Firm, PLLC 925 S. Capital of Texas Hwy, Suite B225 Austin, Texas 78746 Phone (512) 330-0017 TRIAL COUNSEL FOR PLAINTIFF: John F. Melton State Bar No. 24013155 Email: jmelton@jfmeltonlaw.com The Melton Law Firm, PLLC 925 S. Capital of Texas Hwy, Suite B225 Austin, Texas 78746 Phone (512) 330-0017 DEFENDANT: TEXAS ALCOHOL BEVERAGE COMMISSION APPELLATE COUNSEL FOR DEFENDANT: C. Lee Winkelman State Bar No. 24042176 Email: lee.winkelman@oag.texas.gov Assistant Attorney General iii General Litigation Division P.O. Box 12548, Capitol Station Austin, Texas 78711-2548 Phone (737) 231-7737 TRIAL COUNSEL FOR DEFENDANT: C. Lee Winkelman State Bar No. 24042176 Email: lee.winkelman@oag.texas.gov Assistant Attorney General General Litigation Division P.O. Box 12548, Capitol Station Austin, Texas 78711-2548 Phone (737) 231-7737 iv INDEX OF AUTHORITIES CASES Page Abramson v. William Paterson College of New Jersey, 260 F.3d 265, 277-78 (3rd Cir. 2001) 11 Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). 8 Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548 (1986) 8 Charbonnages de France v. Smith, 587 F.2d 406, 414 (4th Cir. 1979) 10 Cherry v. Menard, Inc., 101 F.Supp. 2d 1160, 1167 (N.D. Iowa 2000) 11 Equal Emp't Opportunity Comm'n v. LHC Grp., Inc., 773 F.3d 688 (5th Cir., 2014) Goosby v. Johnson & Johnson Medical, Inc., 228 F.3d 313, 321 (3rd Cir. 2000) 11 Gallagher v. Delaney, 139 F. 3d 338, 343-44(2nd Cir. 1998 11 Hansen v. Aon Risk Servs. of Tex., Inc., 473 F. Supp. 2d 743 (S.D. Tex. 2007) 5 Hunt v. Cromartie, 525 U.S. 541, 549, 551-52 (1999) 9 Int'l Shortstop, Inc. v. Rally's, Inc., 939 F.2d 1257, 1265 (5th Cir. 1991) 10 Johnson v. U. of Cincinnati, 215 F.3d 561, 578 (6th Cir. 2000) 11 Lowe v. City of Monrovia, 775 F.2d 998, 1009 (9th Cir.1985) 11 Nichols v. Loral Vought Systems, Corp., 81 F.3d 38, 41 (5th Cir.1996). 9 Mackey v. Enventives, L.L.C., 802 Fed.Appx. 835, 836-37 (5th Cir. 2020) 7,9 Mission Consol. Indep. Sch. Dist. v. Garcia, 372 S.W.3d 629, 638 (Tex. 2012) 6 v Northwestern Resources Co. v. Banks, 4 S.W.3d 92, 96 (Tex.App.—Waco 1999) 12 Passons v. The University of Texas at Austin, 969 S.W.2d 560, 564 (Tex.App.—Austin 1998, no pet.) 12 Quantum Chemical Corp. v. Toennies, 47 S.W.3d 473, 477 (Tex.2001) 12 Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133, 147-48 (2000) 12 Ross v. Communications Satellite Corp., 759 F.2d 355, 365 (4th Cir. 1985). 10 Royal v. CCC & R Tres Arboles, L.L.C., 736 F.3d 396, 400 (5th Cir.2013) 8 Stewart v. Rutgers University, 120 F.3d 426, 431 (3rd Cir. 1997) 11 Texas Dep't of Community Affairs v. Burdine, 450 U.S.248, 253 (1981) 9 United States Postal Serv. Bd. of Governors v. Aikens, 460 U.S. 711, 716, 103 S.Ct. 1478, 75 L.Ed.2d 403 (1983) 10 Vielma v. Eureka Co., 218 F.3d 458 (5th Cir. 2000) 5 Zysk v. FFE Minerals, USA, Inc. et al., Civ. Action No. 00-5874, 2001 U.S. Dist. LEXIS 20914 *6-7 (E.D. Pa. Dec. 15, 2001) 11 vi STATEMENT OF THE CASE Appellant filed this lawsuit on April 8, 2018. C.R. 5-10. Appellee filed an amended plea to the jurisdiction and motion for summary judgment on October 24, 2024. C.R. 241-393. Appellee responded on February 27, 2025. C.R. 423-434. The trial court denied Appellee’s motion on March 13, 2025. C.R. 456-457. This appeal followed. C.R. 462-465. STATEMENT REGARDING ORAL ARGUMENT Plaintiff respectfully requests oral argument in this case. The matter at issue is factually intensive and appellant believes oral argument would be beneficial. ISSUE PRESENTED Whether the trial court erred in denying Appellee’s Plea to the Jurisdiction and Motion for Summary Judgment. STATEMENT OF FACTS Plaintiff, an African-American male, began working for the TABC in 2009. On July 5, 2017 he was Chief of Enforcement for the Agency when he was notified that he was being terminated. C.R. 435-442. Plaintiff did not have any performance or disciplinary issues. Plaintiff was told by TABC that the Agency was being taken in a new direction and that Plaintiff was not part of that direction. No performance or disciplinary issues were cited for his termination. Id. 2 Soon after Plaintiff was fired in July, 2017 Plaintiff had a phone conversation with Robert Saenz, Executive Chief of the TABC and Plaintiff’s supervisor at TABC prior to Plaintiff’s termination. Saenz informed Plaintiff that his termination was a mistake and that they had actually meant to fire Plaintiff’s African-American co- worker, Dexter Jones. He told Plaintiff that a Texas House Representative, Sarah Davis, had issues with Dexter Jones due to disputes between the agency and certain retailers and wanted to see him terminated. According to Robert Saenz there was a mistake and instead of firing Dexter the agency fired Plaintiff and had, “fired the wrong black guy.” Robert encouraged Plaintiff to contact Don Rupp, Director of Human Rexources, for more information. Id. Plaintiff spoke with Don Rupp and he told Plaintiff specifically that his performance had nothing to do with his termination and that Rupp was bothered by it. Rupp also stated that he did not understand why Plaintiff had been terminated. Plaintiff told Rupp that the Texas Workforce Commission sent him a letter saying that TABC had cited his performance as the reason for termination. Don Rupp insisted that was not true and that he would work to correct that with TWC. Plaintiff told Don Rupp what Robert Saenz had told him about “the wrong black guy” being fired and Rupp assured Plaintiff that there was no legitimate reason for my termination. Id. 3 After Plaintiff was terminated, Plaintiff learned from Robert Saenz that Victor Kuykendoll, a white male, had replaced him as Chief of Enforcement. Id. SUMMARY OF THE ARGUMENT The trial court did not err in denying Appellee’s Plea to the Jurisdiction and Motion for Summary Judgment. As the facts above and the argument below show, there is a fact issue as to whether or not Appellee was fired simply because he is black. Appellant fired the “wrong black guy.” This is the rare case in which Appellant rather clearly and overtly discriminated against Appellee simply based on his race. ARGUMENT I. Introduction Appellant titled its filing as a plea to the jurisdiction and a motion for summary judgment, but Appellantreally made no summary judgment argument other than citing the standards, but rather based its motion on the standard for a plea to the jurisdiction. II. Plea to the Jurisdiction A. Failure to Exhaust Appellant misstated the law in regard to the failure to exhaust and the case law it cites shows that. It is very important to note that the right to sue letter issued in this 4 case came from the EEOC, not the Texas Workforce Commission. Defendant’s own cited law, Hansen v. Aon Risk Servs. of Tex., Inc., 473 F. Supp. 2d 743, 748 (S.D. Tex. 2007) states that, “the EEOC's "right to sue" letter could not trigger the 60-day filing period under § 21.254 (citing Vielma v. Eureka Co., 218 F.3d 458, 465-468 (5th Cir. 2000)”. Hansen specifically involved a case where a TWC right to sue letter had been issued. That is not the case here. Under Vielma, when an EEOC right to sue letter is at issue, the 60 day period in 21.254 is never implicated and a Appellee need only comply with the two year statute of limitations in Section 21.256. Id. At 463. There is no dispute that suit was filed within the two year statute of limitations. Appellee has successfully exhausted his administrative remedies. B. Direct Evidence First, Appellee is not bound by the burden shifting framework required of a circumstantial evidence claim. Appellee has direct evidence of racial discrimination in this case, which obviates the need for establishment of a prima facie case. Appellee has pled and has provided a declaration (see Appellee’s First Amended Petition and Exhibit “A”, declaration of Earl Pearson) that the Executive Chief of the TABC told him that the Commission had, “fired the wrong black guy.” C.R. 423-434. This is an admission by Appellant of direct evidence of race discrimination in that if Appellee had not happened to be a black man he never would have been fired. 5 Appellant has admitted that the only reason Appellee was fired was because he was black. C. Prima Facie Case In the event the Court rules that Appellee does have to meet the McDonnell Douglas standard, Appellant misstates what Appellee’s burden is at the plea to the jurisdiction stage. An Appellee is not required to marshal evidence and prove his claim to establish the Court’s jurisdiction. Mission Consol. Indep. Sch. Dist. v. Garcia, 372 S.W.3d 629, 638 (Tex. 2012). While a Appellee must plead the elements of his statutory cause of action — the basic facts that make up the prima facie case—so that the court can determine whether she has sufficiently alleged a TCHRA violation, he will only be required to submit evidence if the Appellant presents evidence negating one of those basic facts. Id. And even then, the Appellee's burden of proof with respect to those jurisdictional facts must not “involve a significant inquiry into the substance of the claims.” Id. Appellant has not negated any of Appellee’s basic facts. In this case, Appellant asserts that Appellee has failed to plead sufficient facts to establish a prima facie discrimination case, but fails at any point to state what those elements are or which of those elements he has failed to adequately plead. For this reason alone Appellant’s plea was properly denied. 6 Regardless, Appellee has pled sufficient facts to support a prima facie case of race discrimination. C.R. 5-10. To establish a prima facie case of race discrimination, the employee must show that he is (1) a member of a protected class; (2) was qualified for his position; (3) suffered an adverse employment action; and (4) was replaced by someone outside his protected class, or that others similarly situated outside the protected class were treated more favorably. Mackey v. Enventives, L.L.C., 802 Fed.Appx. 835, 836-37 (5th Cir. 2020). Here, Appellee has pled that he was in a protected class (African-American), that he was qualified for his position (including that he was an 8 year employee and the Director of HR said there was no reason for him to be terminated , that he was terminated and that he was replaced by someone outside his protected class. C.R. 5- 10. D. Pretext There is ample evidence of pretext to raise an issue of material fact. First, Robert Saenz admitted the reason given for termination was false. See Exhibit A to Plaintiff’s Response. C.R. 423-434 In addition, in its plea Appellant has cited misconduct and lack of leadership and initiative as reasons for termination. However as Defendant’s own Exhibit 4 shows, there was no mention of any reason for termination other than his being an at-will employee. Defendant’s changing stories 7 on the reason for termination raise a fact issue as to what the actual reason was and is evidence of pretext. Defendant’s Plea to the Jurisdiction was properly denied. III. Summary Judgment A. Summary Judgment Standard in Employment Cases Summary judgment is appropriate if “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A genuine dispute of material fact exists when the “evidence is such that a reasonable jury could return a verdict for the nonmoving party.’ ” Royal v. CCC & R Tres Arboles, L.L.C., 736 F.3d 396, 400 (5th Cir.2013) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). “[A] party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of [the record] which it believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the moving party succeeds, the onus shifts to “the nonmoving party to go beyond the pleadings and by her own affidavits, or by the ‘depositions, answers to interrogatories, and admissions on file,’ designate ‘specific 8 facts showing that there is a genuine issue for trial.’ ” Id. at 324, 106 S.Ct. 2548. The court must “draw all reasonable inferences in favor of the nonmoving party” and “refrain from making credibility determinations or weighing the evidence.”. Equal Emp't Opportunity Comm'n v. LHC Grp., Inc., 773 F.3d 688 (5th Cir., 2014) 1. The Appellee's burden to establish a prima facie discrimination case is not difficult To establish a prima facie case of race discrimination under the TCHRA, a Appellee must show that (1) a member of a protected class; (2) was qualified for his position; (3) suffered an adverse employment action; and (4) was replaced by someone outside his protected class, or that others similarly situated outside the protected class were treated more favorably. Mackey v. Enventives, L.L.C., 802 Fed.Appx. 835, 836-37 (5th Cir. 2020). The prima facie burden is not onerous and the Appellee must make only a minimal showing. See Texas Dep't of Community Affairs v. Burdine, 450 U.S.248, 253 (1981); Nichols v. Loral Vought Systems, Corp., 81 F.3d 38, 41 (5th Cir.1996). 2. Summary Judgment in employment cases should rarely be granted Even when the underlying facts are not in dispute "motivation is itself a factual question" that is subject to conflicting inferences and cannot be decided on summary judgment. Hunt v. Cromartie, 525 U.S. 541, 549, 551-52 (1999). 9 When an employment dispute depends on the employer's motive or state of mind, summary judgment is not appropriate. As the Fifth Circuit noted in Int'l Shortstop, Inc. v. Rally's, Inc., 939 F.2d 1257, 1265 (5th Cir. 1991), This is so because it is particularly difficult for the nonmoving party to challenge the "self-serving testimony" of the moving party without the benefit of trial accessories, namely cross-examination.” "[S]ummary judgment is seldom appropriate in cases wherein particular states of mind are decisive elements of [a] claim." Charbonnages de France v. Smith, 587 F.2d 406, 414 (4th Cir. 1979). Resolution of questions of intent depend on credibility determinations which must be reserved for trial. Ross v. Communications Satellite Corp., 759 F.2d 355, 365 (4th Cir. 1985). Thus, courts must take special care in discrimination cases where the critical issue is discriminatory motive or intent. Id. at 364. Courts have recognized that in discrimination and retaliation cases, an employer's true motivations are particularly difficult to ascertain. See United States Postal Serv. Bd. of Governors v. Aikens, 460 U.S. 711, 716, 103 S.Ct. 1478, 75 L.Ed.2d 403 (1983) (acknowledging that discrimination cases present difficult issues for the trier of fact, as "[t]here will seldom be 'eyewitness' testimony as to the employer's mental processes"), thereby frequently making such factual determinations 10 unsuitable for disposition at the summary judgment stage. See Lowe v. City of Monrovia, 775 F.2d 998, 1009 (9th Cir.1985) (stating that very little additional evidence is required to raise a genuine issue of fact regarding motive, and concluding that summary judgment on the merits is ordinarily inappropriate once a prima facie case has been established). The requirements that the court should view the facts in the light most favorable to the non-moving party and draw all inferences in that party's favor are to be applied with added rigor in employment cases, where intent and credibility are crucial issues. See e.g. Stewart v. Rutgers University, 120 F.3d 426, 431 (3rd Cir. 1997). See also, Zysk v. FFE Minerals, USA, Inc. et al., Civ. Action No. 00-5874, 2001 U.S. Dist. LEXIS 20914 (E.D. Pa. Dec. 15, 2001), *6-7, citing Goosby v. Johnson & Johnson Medical, Inc., 228 F.3d 313, 321 (3rd Cir. 2000); Gallagher v. Delaney, 139 F. 3d 338, 343-44(2nd Cir. 1998); Abramson v. William Paterson College of New Jersey, 260 F.3d 265, 277-78 (3rd Cir. 2001); Johnson v. U. of Cincinnati, 215 F.3d 561, 578 (6th Cir. 2000); Cherry v. Menard, Inc., 101 F.Supp. 2d 1160, 1167 (N.D. Iowa 2000) (collecting cases holding that summary judgment should seldom be used in employment cases). 11 3. Appellee has direct evidence of racial discrimination and can also defeat summary judgment through circumstantial evidence As noted above, Appellee has direct evidence of race discrimination - Saenz admission regarding terminating the wrong black guy. C.R. 423-434. Since employers rarely admit that they acted for illegal reasons, direct evidence of a discriminatory intent is rare, and Appellees ordinarily must prove pretext by circumstantial evidence. See Northwestern Resources Co. v. Banks, 4 S.W.3d 92, 96 (Tex.App.—Waco 1999) (finding more than a-scintilla- of evidence of pretext). See Passons v. The University of Texas at Austin, 969 S.W.2d 560, 564 (Tex.App.—Austin 1998, no pet.) ("Discriminatory intent can generally only be inferred from circumstantial evidence."). In a unanimous decision in 2000, the United States Supreme Court has held that when there is evidence that the employer's explanation for discharge is unworthy of credence, that is circumstantial evidence of discrimination. See Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133, 147-48 (2000) ("[T]he trier of fact can reasonably infer from the falsity of the explanation that the employer is dissembling to cover up a discriminatory purpose."). This decision has been followed by the Texas Supreme Court as well. See Quantum Chemical Corp. v. Toennies, 47 S.W.3d 473, 477 (Tex.2001) ("Proving that the employer's stated reasons for the 12 firing is a pretext is ordinarily sufficient to permit the trier of fact to find that the employer is actually motivated by discrimination.") (citing Reeves, 530 U.S. 133, 147-48). B. Argument The same arguments made in regard to Defendant’s plea to the jurisdiction apply equally and as convincingly to Defendant’s motion for summary judgment. In the interest of brevity, rather than restate them in whole, Appellee reiterates his arguments that Appellee has provided direct evidence of race discrimination, that Appellant has not properly identified on what basis Appellant is challenging his prima facie case, that, regardless, Appellee has established a prima facie race discrimination claim and that there is a material issue of genuine fact in regard to the pretextual nature of Defendant’s reason for termination. C.R. 423-434 Defendant’s Motion for Summary Judgment was properly denied. PRAYER WHEREFORE, PREMISES CONSIDERED, APPELLEE prays that the trial court’s decision be affirmed and this matter remanded for a trial on the merits in front of a Travis County jury as the Texas Constitution provides. 13 CERTIFICATE OF COMPLIANCE This brief contains 3,463 words according to Wordperfect 2021. /s/ John F. Melton John F. Melton Respectfully submitted, The Melton Law Firm, P.L.L.C. 925 South Capital of Texas Highway, Ste. B225 Austin, Texas 78746 (512) 330-0017 Telephone /s/ John F. Melton John F. Melton EMAIL: jmelton@jfmeltonlaw.com State Bar No. 24013155 ATTORNEYS FOR APPELLEE 14 CERTIFICATE OF SERVICE By my signature below, I hereby certify that a true and correct copy of the foregoing document has been served on all parties of record Via Email on this 14th of July, 2025, addressed as follows: Email: lee.winkelman@oag.texas.gov C. Lee Winkelman Assistant Attorney General General Litigation Division P.O. Box 12548, Capitol Station Austin, Texas 78711-2548 Phone (737) 231-7737 /s/ John F. Melton John F. Melton 15 15-25-00037-CV IN THE COURT OF APPEALS FOR THE FIFTEENTH DISTRICT AUSTIN, TEXAS TEXAS ALCOHOLIC BEVERAGE COMMISSION, Appellant-Defendant, v. EARL PEARSON, Appellee-Plaintiff. On Appeal from the 261st Judicial District Court, Travis County, Texas Trial Court Cause No. D-1-GN-18-001703 APPELLEE’S APPENDIX John F. Melton Email: jmelton@jfmeltonlaw.com State Bar No. 24013155 THE MELTON LAW FIRM, P.L.L.C. 925 S. Capital of Texas Hwy, Suite B225 Austin, Texas 78746 (512) 330-0017 Telephone ATTORNEY FOR APPELLEE APPELLEE’S APPENDIX 1. Order Denying Defendant’s Plea to the Jurisdiction and Motion for Summary Judgment 2. Plaintiff’s Response Defendant’s Plea to the Jurisdiction and Motion for Summary Judgment 3. Plaintiff’s First Amended Original Petition TAB 1 03/13/2025 01:14:28 PM Velva L. Price District Clerk Travis County D-1-GN-18-001703 CAUSE NO.: D-1-GN-18-001703 EARL PEARSON § IN THE DISTRICT COURT Plaintiff, § § v. § 261st JUDICIAL DISTRICT § TEXAS ALCOHOLIC BEVERAGE § COMMISSION § Defendant. § TRAVIS COUNTY, TEXAS ORDER DENYING DEFENDANT’S PLEA TO THE JURISDICTION AND MOTION FOR SUMMARY JUDGMENT On the 11th day of March, 2025, came on to be heard, Defendant’s Plea to the Jurisdiction and Motion for Summary Judgment. Having considered the motion, the Plaintiff’s response thereto, and arguments of counsel, the Court hereby denies Defendant's Plea to the Jurisdiction and Motion for Summary Judgment. IT IS THEREFORE ORDERED, that Defendant’s Plea to the Jurisdiction and Motion for Summary Judgment are DENIED. 13th day of ___________________, SIGNED this _____ March 2025. ________________________________ Honorable Laurie Eiserloh 455th Judicial District Judge, Travis County Page 456 AGREED AS TO FORM: /s/ Michael W. Balcezak Michael W. Balcezak State Bar No.: 24012236 email: Michael@jfmeltonlaw.com THE MELTON LAW FIRM, P.L.L.C. 925 S. Capital of Tex. Highway, Ste B225 Austin, Texas 78746 Telephone: 512/330-0017 ATTORNEYS FOR PLAINTIFF /s/ Kelsey L. Warren (Signed with permission) Kelsey L. Warren State Bar No.: 24095736 Assistant Attorney General email: kelsey.warren@oag.texas.gov Office of the Attorney General General Litigation Division P.O. Box 12548, Capitol Station Austin, Texas 78711-2548 ATTORNEYS FOR DEFENDANT 04/07/2025 08:42:45 2 Page 457 TAB 2 2/27/2025 3:40 PM Velva L. Price District Clerk Travis County D-1-GN-18-001703 Susan Poodiack Page 423 Page 424 Page 425 Page 426 Page 427 Page 428 Page 429 Page 430 Page 431 Page 432 Page 433 Automated Certificate of eService This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules. John Melton Bar No. 24013155 jmelton@meltonkumler.com Envelope ID: 97888559 Filing Code Description: RESPONSE Filing Description: PLAINTIFF'S RESPONSE TP DEFENDANT'S PLEASE TO JURISDICTION AND MOTION FOR SUMMARY JUDGMENT Status as of 2/27/2025 4:57 PM CST Case Contacts Name BarNumber Email TimestampSubmitted Status Paige Densman paige@jfmeltonlaw.com 2/27/2025 3:40:22 PM SENT John Melton jmelton@jfmeltonlaw.com 2/27/2025 3:40:22 PM SENT michael Balcezak michael@jfmeltonlaw.com 2/27/2025 3:40:22 PM SENT LASHANDA GREEN lashanda.green@oag.texas.gov 2/27/2025 3:40:22 PM SENT Associated Case Party: TEXAS ALCOHOLIC BEVERAGE COMMISSION Name BarNumber Email TimestampSubmitted Status KELSEY WARREN kelsey.warren@oag.texas.gov 2/27/2025 3:40:22 PM SENT 04/07/2025 08:42:45 Page 434 TAB 3 2/27/2025 3:43 PM Velva L. Price District Clerk Travis County CAUSE NO.: D-1-GN-18-001703 D-1-GN-18-001703 Nancy Rodriguez EARL PEARSON § IN THE DISTRICT COURT Plaintiff, § § v. § 261st JUDICIAL DISTRICT § TEXAS ALCOHOLIC BEVERAGE § COMMISSION § Defendant. § TRAVIS COUNTY, TEXAS PLAINTIFF’S FIRST AMENDED PETITION TO THE HONORABLE JUDGE OF SAID COURT: NOW COMES Plaintiff, Earl Pearson, and files this First Amended Petition complaining of Defendant Texas Alcoholic Beverage Commission, and for cause of action would show the Court the following: I. DISCOVERY 1.1 Plaintiff intends to conduct discovery under Rule 190.3 (Level 2) of the Texas Rules of Civil Procedure. II. THE PARTIES 2.1 Plaintiff is an individual who can be contacted through counsel. 2.2 Defendant Texas Alcoholic Beverage Commission is an entity that may be served through its Executive Director, Bentley Nettles at 5806 Mesa Drive, Austin, Texas 78731. III. JURISDICTION, VENUE AND CONDITION PRECEDENT 3.1 The amount in controversy exceeds the jurisdictional minimum amount in controversy for Page 435 this Court. Plaintiff seeks monetary relief over $1,000,000. 3.2 Pursuant to Texas Civil Practice and Remedies Code §15.002, venue is proper in Travis County, Texas, as it is the county in which all or a substantial part of the events or omissions giving rise to the claim occurred. 3.3 All conditions precedent have been performed or have occurred. IV. FACTS 4.1 Plaintiff, an African-American male, began working for the TABC in 2009. On July 5, 2017 he was Chief of Enforcement for the Agency when he was notified that he was being terminated. Plaintiff did not have any performance or disciplinary issues. Plaintiff was told by TABC that the Agency was being taken in a new direction and that Plaintiff was not part of that direction. No performance or disciplinary issues were cited for his termination. 4.2 Soon after Plaintiff was fired in July, 2017 Plaintiff had a phone conversation with Robert Saenz, Executive Chief of the TABC and Plaintiff’s supervisor at TABC prior to Plaintiff’s termination. Saenz informed Plaintiff that his termination was a mistake and that they had actually meant to fire Plaintiff’s African-American co-worker, Dexter Jones. He told Plaintiff that a Texas House Representative, Sarah Davis, had issues with Dexter Jones due to disputes between the agency and certain retailers and wanted to see him terminated. According to Robert Saenz there was a mistake and instead of firing Dexter the agency fired Plaintiff and had, “fired the wrong black guy.” Robert encouraged Plaintiff to contact Don Rupp, Director of Human Rexources, for more information. Page 436 4.3. Plaintiff spoke with Don Rupp and he told Plaintiff specifically that his performance had nothing to do with his termination and that Rupp was bothered by it. Rupp also stated that he did not understand why Plaintiff had been terminated. Plaintiff told Rupp that the Texas Workforce Commission sent him a letter saying that TABC had cited his performance as the reason for termination. Don Rupp insisted that was not true and that he would work to correct that with TWC. Plaintiff told Don Rupp what Robert Saenz had told him about “the wrong black guy” being fired and Rupp assured Plaintiff that there was no legitimate reason for my termination. 4.4. After Plaintiff was terminated, Plaintiff learned from Robert Saenz that Victor Kuykendoll, a white male, had replaced him as Chief of Enforcement. V. CAUSES OF ACTION 5.1 The allegations contained in Paragraph 4.1-4.2 are hereby incorporated by reference for all causes of action. Plaintiff is not seeking any relief pursuant to any federal laws of the United States, but rather is seeking relief pursuant to the Texas Labor Code. Race Discrimination 5.2 The conduct of Defendants towards Plaintiff, through its agents, employees, managers, and supervisors, as set forth above, among other activities, constitutes race discrimination, in direct violation of §21.001, et. seq., Labor Code, Vernon’s Texas Codes Annotated, which states, in pertinent part, that: “An employer commits an unlawful employment practice if ... the employer ... discriminates against an individual ... or ... classifies an employee ... in a manner that 3 Page 437 would deprive or tend to deprive an individual of any employment opportunity or adversely affect in any manner the status of an employee.” Plaintiff is a member of a protected class and was selected for unfavorable treatment by Defendant, including his termination, because of his race. There is no legitimate non-discriminatory reason for Defendant’s actions, and if such a reason is propounded, it is a pretext. Plaintiff’s race was a determining or motivating factor in Defendant’s decision to terminate Plaintiff’s employment and otherwise discriminate against him. Unlawful discrimination moved Defendant toward its decision or was a factor that played a part in Defendant’s employment decisions as to Plaintiff. The unlawful practices committed by Defendant were and are a direct cause of Plaintiff’s damages, as more fully set forth below. VI. DAMAGES 6.1 As a result of Defendant’s unlawful conduct, Plaintiff has suffered economic and actual damages, including past and future lost income, back wages or back pay, interest on back pay and front pay, future wages or front pay, employment benefits in the past and future, lost earnings in the past and future, and all lost benefits under the contract or employment relationship. VII. COMPENSATORY DAMAGES 7.1 Defendant has intentionally engaged in unlawful employment practices. Plaintiff additionally brings suit for compensatory damages, including emotional pain and suffering, inconvenience, mental anguish, loss of enjoyment of life, injury to professional standing, injury 4 Page 438 to character and reputation, injury to credit standing, job search expenses, lost earning capacity in the past and future, and other pecuniary and non-pecuniary losses. VIII. ATTORNEYS’ FEES AND EXPERT FEES 8.1 A prevailing party may recover reasonable attorneys’ fees, expert fees, and costs. SEE TEX. LAB. CODE §21.259. Plaintiff brings suit for these fees from Defendant. Plaintiff seeks all reasonable expert fees and attorneys' fees in this case, including preparation and trial of this lawsuit, post-trial, pre-appeal work, any appeal to the Texas Court of Appeals, making or responding to an application for writ of error to the Texas Supreme Court, an appeal to the Texas Supreme Court if an application for writ of error is granted, and post-judgment discovery and collection in the event execution on the judgment is necessary. IX. PUNITIVE DAMAGES 9.1 Defendant has acted with malice or reckless indifference to Plaintiff’s rights. Defendant, by engaging in the aforementioned acts and/or in authorizing and/or ratifying the aforementioned acts, engaged in willful, malicious, intentional, and oppressive conduct and acted with willful and conscious disregard, or alternatively reckless disregard or indifference of the rights, welfare, and safety of Plaintiff, therefore justifying the award of punitive and exemplary damages in an amount to be determined at trial. Therefore, Plaintiff additionally brings suit for punitive damages and exemplary damages. 5 Page 439 X. JURY DEMAND 10.1 Plaintiff demands a trial by jury of all the issues and facts in this case and has tendered the requisite fee. PRAYER FOR RELIEF WHEREFORE, PREMISES CONSIDERED, Plaintiff prays that Defendant be cited to appear and answer herein, and, upon final trial, Plaintiff have Judgment against Defendant as requested above, and as follows: 1. Judgment against Defendant for all damages alleged in this petition; 2. Interest before and after judgment at the highest rate provided by law, until paid; 3. Costs of suit; 4. Reasonable and necessary attorneys’ fees and expert witness fees; 5. Injunctive and declaratory relief; and 6. Such other and further relief to which Plaintiff may be justly entitled. 6 Page 440 Respectfully submitted, THE MELTON LAW FIRM, P.L.L.C. 925 S. Capital of Tex. Highway, Ste B225 Austin, Texas 78746 Telephone: 512/330-0017 /s/ John F. Melton John F. Melton jmelton@jfmeltonlaw.com State Bar No. 24013155 Michael W. Balcezak State Bar No.: 24012236 Michael@jfmeltonlaw.com ATTORNEYS FOR PLAINTIFF CERTIFICATE OF SERVICE By my signature below, I hereby certify that a true and correct copy of the foregoing document has been served on all parties of record in accordance with the Texas Rules of Civil Procedure on February 27, 2025 as follows: Kelsey L. Warren Assistant Attorney General kelsey.warren@oag.texas.gov Office of the Attorney General General Litigation Division P.O. Box 12548, Capitol Station Austin, Texas 78711-2548 /s/ John F. Melton John F. Melton 7 Page 441 Automated Certificate of eService This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules. John Melton Bar No. 24013155 jmelton@meltonkumler.com Envelope ID: 97888836 Filing Code Description: Amended Filing Filing Description: PLAINTIFF’S FIRST AMENDED PETITION Status as of 3/4/2025 10:08 AM CST Case Contacts Name BarNumber Email TimestampSubmitted Status Paige Densman paige@jfmeltonlaw.com 2/27/2025 3:43:21 PM SENT John Melton jmelton@jfmeltonlaw.com 2/27/2025 3:43:21 PM SENT michael Balcezak michael@jfmeltonlaw.com 2/27/2025 3:43:21 PM SENT LASHANDA GREEN lashanda.green@oag.texas.gov 2/27/2025 3:43:21 PM SENT Associated Case Party: TEXAS ALCOHOLIC BEVERAGE COMMISSION Name BarNumber Email TimestampSubmitted Status KELSEY WARREN kelsey.warren@oag.texas.gov 2/27/2025 3:43:21 PM SENT 04/07/2025 08:42:45 Page 442 Automated Certificate of eService This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules. John Melton Bar No. 24013155 jmelton@meltonkumler.com Envelope ID: 103120738 Filing Code Description: Brief Requesting Oral Argument Filing Description: Brief Requesting Oral Argument Status as of 7/15/2025 8:21 AM CST Associated Case Party: Earl Pearson Name BarNumber Email TimestampSubmitted Status John Melton 24013155 jmelton@jfmeltonlaw.com 7/14/2025 7:48:28 PM SENT Michael Balcezak Michael@jfmeltonlaw.com 7/14/2025 7:48:28 PM SENT Associated Case Party: Texas Alcoholic Beverage Commission Name BarNumber Email TimestampSubmitted Status Laura Hendrix laura.hendrix@oag.texas.gov 7/14/2025 7:48:28 PM SENT Lee Winkelman lee.winkelman@oag.texas.gov 7/14/2025 7:48:28 PM SENT