EX-TSC PRESIDENTS $1 AWARD UPHELD, ATTORNEYS GET FEES

 Special to El Rrun-Rrun

The Fifth Circuit Court of Appeals has upheld the federal district court's reduction of a $13.1 million  jury award to $1 and sent the case back to reconsider its denial of fees for her attorneys saying it had misinterpreted the law. 

The ruling was issued February 24.

Texas Southmost College trustees terminated Tercero in September 2016. 

She sued in federal court and a jury awarded her 12.5 million which a federal judge reduced to $1 in July 2019.

Tercero sued TSC after the board of trustees fired her for: 

*deliberately and recklessly failing to obtain windstorm insurance with board approval in compliance with state law; 

*for allowing TSC checks to be stamped with signatures of people who were no longer trustees;

*for failing to timely search and fill the position of vice president for finance and administration; for failing to inform the board of the ailing nursing program and its pending suspension

* for refusing a board member’s request that he personally sign and review checks in the amount of $10,000 or more and for not complying with a request for information sought by another member.

 Tercero’s testimony was about events that preceded her termination hearing. And she did not challenge the district court’s conclusion on summary judgment that the pre-hearing notice – which seems to have prompted a newspaper article – did not violate her due-process rights. 

Thus the court ruled that Tercero had not shown that any injury she suffered in connection with the notice and newspaper article was caused by the due-process violation at issue, i.e., issues with the hearing itself.

Consequently, then court ruled, "we affirm the district court’s grant of judgment as a matter of law on the due-process violation damages and reduction of the jury’s award of $12,500,000 to the nominal amount of $1."

The jury found that TSC breached Tercero’s employment contract and deprived her of procedural due process. 

It awarded her $674,878.66 in damages on her breach-of-contract claims and $12,500,000 in damages on her due-process claim for "diminished earning capacity, lost career and business opportunities, loss of reputation, humiliation, embarrassment, inconvenience, and mental and emotional anguish and distress.” 

After trial, the district court awarded Tercero $117,685.67 in attorneys’ fees from TSC in connection with these claims, then denied them.

The appeals court ruled that the district court abused its discretion in vacating Tercero’s attorneys’ fees award based on her breach-of-contract claims because it erroneously determined that TSC is entitled to Eleventh Amendment immunity on those claims. 

Tercero’s attorneys had argued that three pieces of testimony showed that there was sufficient evidence to support the jury’s verdict. 

First, Tercero testified that, after her employment with TSC ended, she was a finalist for a new position. She testified that “the accusations that were made against me [at TSC] came up . . . and I have no doubt that they didn’t pick me because of what they had read.” 

However, the appeals court ruled that Tercero only speculated that the accusations were the reason she did not receive the position; and did not name, explained, or described what position she had applied for or what its attendant qualifications were; and concedes that she was a finalist for the position.

The district court’s award of attorneys’ fees was, however, based on Tercero’s attorneys’ work on both the breach-of-contract and due-process claims. It did not distinguish between work done on one claim versus the other. 

"We therefore reverse the district court’s vacatur of the portion of the attorneys’ fees award based on the breach-of-contract claims and remand for the district court to address TSC’s alternative arguments regarding those claims and to determine whether Tercero is entitled to attorneys’ fees and in what amount."