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Cardenas v. Maslon

United States District Court, N.D. Mississippi, Oxford Division

March 17, 2015


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[Copyrighted Material Omitted]

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For Jennifer Cardenas, Plaintiff: Justin Strauss Cluck, LEAD ATTORNEY, SMITH WHALEY, PLLC, Holly Springs, MS.

For Hilary Maslon, Defendant: Laurance Nicholas Chandler Rogers, LEAD ATTORNEY, ROGERS LAW GROUP, P.A., New Albany, MS.

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This removed action is brought by Plaintiff Jennifer Cardenas against her former employer, Defendant Hilary Maslon. Doc. #2. Plaintiff alleges that Defendant wrongfully " instituted criminal felony proceedings" which resulted in damage to Plaintiff. Id. Before the Court is Defendant's motion for summary judgment. Doc. #27.


Summary Judgment Standard

" Summary judgment is appropriate when there are no genuine issues as to any material facts, and the moving party is entitled to judgment as a matter of law." Norwegian Bulk Transp. A/S v. Int'l Marine Terminals P'ship, 520 F.3d 409, 411 (5th Cir. 2008) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). To award summary judgment, " [a] court must be satisfied that no reasonable trier of fact could find for the nonmoving party or, in other words, that the evidence favoring the nonmoving party is insufficient to enable a reasonable jury to return a verdict in her favor." Norwegian Bulk Transp. A/S, 520 F.3d at 411--12 (internal quotation marks omitted). To this end, " [t]he moving party bears the burden of establishing that there are no genuine issues of material fact." Id. at 412.

" If, as here, the nonmoving party bears the burden of proof at trial, the moving party may demonstrate that it is entitled to summary judgment by submitting affidavits or other similar evidence negating the nonmoving party's claim, or by pointing out to the district court the absence of evidence necessary to support the nonmoving party's case." Morris v. Covan World Wide Moving, Inc., 144 F.3d 377, 380 (5th Cir. 1998) (citation omitted). If the moving party makes the necessary demonstration, " the burden shifts to the nonmoving party to show that summary judgment is inappropriate." Id. In making this showing, " the nonmoving party must go beyond the pleadings and by her own affidavits, or by the depositions, answers to interrogatories, and admissions on file, designate specific facts showing that there is a genuine issue for trial." Cotroneo v. Shaw Env't & Infrastructure, Inc., 639 F.3d 186, 191--92 (5th Cir. 2011) (citation and internal punctuation omitted). When considering a motion for summary judgment, the Court " resolve[s] factual controversies in favor of the nonmoving party." Little v. Liquid

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Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994).


Relevant Facts

A. Defendant's Business

In 2000, Defendant purchased a 213-acre tract of land in Marshall County, Mississippi (" Land" ). Doc. #27-6 at ¶ 2. Defendant purchased the property with the intention to establish an " arts retreat" on the Land. Id. To this end, also in 2000, Defendant established a 501(c)(3) entity.[1] Id. The following year, Defendant established an LLC and named the Land " Silver Ash Ranch" (" Ranch" ). Id. At the time, Defendant had " [a]bsolutely zero" experience in running a ranch business. Doc. #33-1 at 13.

After deciding " that it was important ... to attain a Master's degree in Fine Arts in order to properly promote and operate [the] arts residency," Defendant applied for and, in 2005, was accepted into, a Master's program at Queens College in New York City. Doc. #27-6 at ¶ 3. Defendant attended Queens College for a semester but returned to Mississippi " in order to ensure [the Ranch] would be adequately cared [for] and income producing" during her time in New York. Id. at ¶ 4.

B. Defendant's Hire of Plaintiff

Upon her return to Mississippi, Defendant elected to " set the ranch up as a retreat." Doc. #27-6 at ¶ 5. Because Defendant had no experience in operating a retreat, she decided to hire a manager. Id. In June 2006, after placing job advertisements in Caretakers Gazette and on the Craig's List website, Defendant was contacted by Plaintiff regarding the manager vacancy. Id. at ¶ 6. Defendant interviewed and then hired Plaintiff. Id. Right around this time, Defendant's bookkeeper was killed in a car accident. Doc. #33-1 at 35.

Under the terms of her employment Plaintiff received: (1) a monthly salary of $500; (2) living accommodations valued at $700 per month; (3) 40% commission on gross receipts of income related to lodging; and (4) $10 per hour for every hour worked per month in excess of 120 hours. Doc. #27-6 at ¶ 9. In return for the compensation, Plaintiff was responsible for a number of duties, including maintenance for the Ranch, assisting in marketing, hiring workers, and " [k]eeping track of the daily financial operations of the [Ranch], including responsibility for handling deposits and paying expenses via checks." Id. at ¶ 8.

In relation to Plaintiff's financial duties, Defendant added Plaintiff as a co-signor on the Ranch's bank account at the Bank of Holly Springs, Mississippi. Doc. #27-6 at ¶ 12. Defendant also authorized Plaintiff " to set up and use a PayPal account ... which had been established in the name of [the] Ranch ... to conduct business related to the [R]anch." Id.

After accepting the job, Plaintiff moved into the provided accommodations with her two children.[2] Doc. #27-6 at ¶ 10. For the first three months of her employment, Plaintiff received training from Defendant

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as to Defendant's " expectations." Id. at ¶ 7.

C. Defendant's Time In New York

Approximately three months after Plaintiff's hire, Defendant retuned to New York to continue her studies at Queens College. Doc. #27-6 at ¶ 11. From 2006 until 2009, Defendant lived in New York, but " returned to the [R]anch ... for summers, holidays and occasional weekends to ensure the ranch was operating accordingly." Id. Defendant also " communicate[d] with Plaintiff in an effort to grow and operate the business at the [R]anch." Id. Specifically, Plaintiff and Defendant " would frequently email each other regarding the activities, including financial activities, of the ranch." Id. at ¶ 14.

During the time she was away, Defendant required that Plaintiff furnish receipts for all expenditures. Doc. #33-1 at 22. Plaintiff would normally keep the receipts in a receipt book in her desk and would provide them to Defendant during Defendant's trips to the Ranch. Id. However, on occasion, Plaintiff would mail the receipts directly to Defendant. Id. at 22--23.

When Defendant was in Mississippi, she would take over some of Plaintiff's duties, " like going to get gas for tractors or going to get food for the animals ...." Doc. #33-1 at 24. On occasion, Plaintiff would have to remind Defendant why Defendant had issued specific checks. Doc. #33-2 at 50.

Although there were some disputes between Plaintiff and Defendant as to Plaintiff's operation and provision of financial updates regarding the Ranch, Defendant " felt that Plaintiff was a good employee and trusted that she would ensure the ranch was taken care [of] during [Defendant's] absences." Doc. #27-6 at ¶ 16.

At some point during 2008, Plaintiff became pregnant and tried to end her employment. Doc. #33-2 at 74. Defendant " gave [Plaintiff] a hard time" and Plaintiff decided to stay. Id.

During the winter of 2008 and 2009, Defendant discovered that Plaintiff had used the PayPal account to purchase tickets to Disney World. Doc. #27-6 at ¶ 17. Although Defendant states that this purchase was made without authorization, Plaintiff testified that she had permission to make the purchase. Id ; Doc. #33-2 at 102. Defendant was " troubled" by what she perceived to be Plaintiff's misappropriation of Ranch funds, but she " had no time to focus on [the incident] without sacrificing [her] degree." Doc. #27-6 at ¶ 18.

At approximately the same time as the purchase of the Disney tickets, Defendant decided to sell the Ranch. Doc. #27-6 at ¶ 18. After placing a listing on the internet, Defendant made arrangements for prospective buyers from Hawaii to visit the property in June 2009. Id.

D. Defendant's Return to Mississippi

In preparation for the prospective buyers, Defendant arranged to return to the Ranch in June 2009 and to have Plaintiff pick her up at the Memphis International Airport. Doc. #27-6 at ¶ 19. In the week leading up to her planned return, Defendant and Plaintiff spoke " multiple times," with Plaintiff " confirm[ing]" the arrangement each time. Id.

Sometime in or before June 2009, Plaintiff discovered she was pregnant. Doc. #33-2 at 73. Based on the pregnancy and her general dislike for the job, Plaintiff decided to quit her position. Id. Furthermore, because of Defendant's reaction to Plaintiff's previous attempt to leave the Ranch, Plaintiff elected not to give Defendant notice of her departure. Id. at 73--74. However, so as to not leave the Ranch

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abandoned, Plaintiff decided to leave the morning Defendant was set to arrive from New York. Id. Plaintiff testified that when she departed, she left all the receipts she had collected since Defendant had last been at the Ranch. Id. at 103--104.

When Defendant landed in Memphis, Plaintiff was not at the airport. Doc. #27-6 at ¶ 20. Thus, Defendant obtained an alternative means of transport to the Ranch.[3] Id. When Defendant arrived at the Ranch, she discovered that Plaintiff, and all Plaintiff's belongings, were gone. Id. Defendant found the receipt book and observed that " there were very few receipts." Doc. #33-1 at 45. The nature of Plaintiff's departure made Defendant " wholly upset." Id. at 105.

Sometime later, Plaintiff informed Defendant that she had quit. Doc. #27-6 at ¶ 21. Plaintiff did not give Defendant a reason for her decision. Id.

For " several" weeks after Plaintiff's departure, Defendant attempted to go through the Ranch's finances. Doc. #27-6 at ¶ 23. However, due to the death of her bookkeeper[4] and her " lack of sophistication in bookkeeping," Defendant did not find anything amiss in the financial information. Id. Defendant even told Plaintiff that " she was pleased with the state the ranch was in." Doc. #33-2 at 77.

Other than exchanging e-mails in the weeks following Plaintiff's departure, Plaintiff and Defendant " essentially had no contact until approximately December 2009 when [Defendant] began to inquire of [Plaintiff's] employment taxes." Doc. #27-6 at ¶ 24. Throughout this time period, Defendant " had no suspicions... that [Plaintiff] had acted inappropriately with the finances of the ranch." Id. However, Defendant felt that the circumstances of Plaintiff's departure were " very strange." Id.

E. Defendant's Hire of Gene Ash and Subsequent Review of Finances

In or about February 2010, Defendant hired Gene Ash to work full-time at the Ranch. Doc. #27-6 at ¶ 25. After his hire, Ash, who had worked at the Ranch under Plaintiff in 2009, informed Defendant that Plaintiff " had been stealing money from the ranch." Id. Ash explained that " on more than one occasion, Plaintiff would ask [Ash] to lie about work done at the ranch and then ... write a wage check (either to him or for 'cash') for the purported work. The check would then be cashed, [Ash] would be given $50.00 and Plaintiff would keep the balance for herself." Id.

Defendant did not ask Ash, who she acknowledged was a " pretty serious alcoholic," any details about the scheme. Doc. #33-1 at 34. 78. Rather, Defendant elected to " look[] at [her] books." Id. at 34. Defendant also decided to retain Ash as an employee because she " appreciated his honesty [a]nd after that I felt like I trusted him." Id.

In or about March 2010, Defendant and a bookkeeper reviewed the financial records of the Ranch. Doc. #27-6 at ¶ 26. During this review, Defendant noticed an " inordinate amount of money written to [Ash, which Defendant] did not feel like

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[was] an accurate representation of the hours he had actually earned." Id. Defendant felt this information " confirmed" Ash's accusations regarding Plaintiff. Id. Defendant also " became suspicious" regarding " 'cash' check writing activities [for expenses] which would have made much more sense to be written to the seller" and " about payments to individuals for jobs which either did not seem reasonable based [on] the job specified in the payments or did not seem reasonable based [on] what [Defendant] knew ...

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