Labor & Employment Law Daily Wrap Up, COVERAGE, LIABILITY—5th Cir.: Shriners employees fired for refusing COVID vaccine can’t revive dismissed claims, (Apr 3, 2025)

By Kathleen Kapusta, J.D.

The employees argued that Shriners, allegedly a state actor by virtue of the fact that it was a vaccine provider, and its agents violated their right to refuse the vaccine without consequences through its mandatory vaccination policy.

The court below did not err is dismissing the claims of four former Shriners employees who were fired when they refused to get a COVID-19 vaccination, the Fifth Circuit ruled. The employees did not have personal jurisdiction over Shriners’ agents who signed either a vaccine provider agreement or Shriners’ vaccine policy and who were located outside the state; Shriners was not a state actor when it implemented its mandatory vaccine policy; and the Executive Commissioner of Texas Health and Services, whom they alleged failed to stop Shriners from terminating them, was entitled to qualified immunity. Although the court also affirmed the dismissal of the employees’ state-law claims, it modified the lower court’s judgment to reflect that it was without prejudice (Pearson v. Shriners Hospitals for Children, Inc., No. 24-40436 (5th Cir. Apr. 2, 2025)).

Reviewing the history of the COVID-19 vaccine, the Fifth Circuit noted that nearly a year after the pandemic hit this country, the Secretary of Health and Human Services issued Emergency Use Authorizations for the Pfizer, Moderna, and Johnson & Johnson vaccines; the federal government then purchased all available vaccines; and the vaccines were available only through the federal COVID vaccine program, in coordination with state and local governments.

Vaccine provider. States were required to make sure the vaccine program was implemented pursuant to federal requirements and the organizations that administered the vaccines had similar requirements. Shriners Hospitals for Children, a private nonprofit corporation that operates an international network of children’s hospitals, became a vaccine provider, signing a vaccine provider agreement.

Vaccine policy. The former employees all worked at a Shriners’ hospital in Texas. In November 2021, Shriners adopted a companywide COVID-19 vaccination policy that allowed employees to get vaccinated through Shriners or through independent entities. When the employees refused to get vaccinated, Shriners fired them.

Lower court proceedings. They then sued Shriners, five agents—two individuals who had signed the vaccine provider agreement and three individuals who had signed the vaccine policy—and the Executive Commissioner of Texas Health and Services (Commissioner). They alleged that Shriners, which they claimed was a state actor by virtue of the vaccine provider agreement, and its agents violated their right to refuse the vaccine without consequences through the mandatory vaccination policy and the Commissioner violated the same right by failing to stop Shriners. The district court granted Shriners’ motion to dismiss all claims.

Claims against agents. On appeal, the Fifth Circuit agreed with the district court that the employees failed to establish personal jurisdiction for their claims against the agents. In support of those claims, the employees pointed only to the agents’ actions in having signed the vaccine provider agreement or the mandatory vaccine policy. As to the two agents that signed the vaccine provider agreement, while their actions were relevant to the employees’ claim that Shriners was a state actor, they had nothing to do with depriving the employees of their alleged right to refuse vaccinations without consequences, said the court. Because the agents’ actions related to Shriners’ vaccine administration across the country, and were not targeted toward Texas, the employees’ claims against the two agents that signed the vaccine provider agreement did not arise out of or relate to the agents’ contacts with Texas.

Nor were the actions of the three agents who signed the vaccine policy sufficiently connected to Texas to support specific jurisdiction, said the court, finding no indication the policy was signed in, or otherwise focused on, Texas. Shriners, the court pointed out, is an international entity with locations across the country and in Canada and the policy appeared to apply to all its locations.

Claims against Shriners. In support of their Section 1983 claim against Shriners, in which they alleged it was a state actor, the employees pointed to its conduct in adopting and enforcing its mandatory vaccine policy. But that policy, the court noted, allowed employees to get vaccinated through Shriners or through other entities and thus Shriners did not implicate its vaccine provider role by requiring that its employees become vaccinated. “A private organization requiring its employees to receive a vaccination is not a state action,” the court emphasized, explaining that it is “commonplace for companies—particularly hospitals—to place such mandates on their employees.”

Nor did the employees show that Texas compelled Shriners to adopt the vaccine policy or that the policy constituted joint action between Shriners and the state. They also failed to allege that Texas had any influence over the hospital’s internal decision-making or had a role in enacting or enforcing the policy.

EUA statute. The employees also brought a claim under the EUA statute, which permits the HHS Secretary to authorize use of a drug in an actual or potential emergency and to establish “[a]ppropriate conditions designed to ensure that individuals to whom the product is administered are informed... of the option to accept or refuse administration of the product.” This language, the employees argued, gave them “the option to accept or refuse” the COVID-19 vaccine without penalty.

Disagreeing, the appeals court noted that the employees again conflated Shriners’ role as a private employer with its role as a vaccine provider and the EUA statute only concerns vaccine providers. Even assuming the statute places duties on anyone other than the HHS Secretary, said the court, “the provision at issue focuses on vaccine providers” as it expressly limits its scope to the “person who carries out” the “activity” of administering COVID-19 vaccines. Indeed, the court stated, the “provision at issue only requires vaccine providers to ensure that their patients are ‘informed’ of their ‘option to accept or refuse’” and “mentions no restriction on whether those providers can require that their own workforce be vaccinated.” Noting further that the statute expressly contemplates that individuals can face “consequences” for “refusing” the vaccine, the court found the employees’ reliance on the EAU statute was misplaced.

Claims against Commissioner. The employees, the court observed, raised the same set of claims against the Commissioner as against Shriners and the agents but only alleged a failure to intervene because the Commissioner did not prevent Shriners from firing them. Though the court found the employees had standing to bring their claims, it agreed with the district court that she was entitled to qualified immunity.

The employees asserted that the Commissioner acted without authority by willfully failing to perform ministerial duties but this argument, the court reasoned, appeared to be based on a failure-to-intervene theory that resembles bystander liability. Here, the court pointed to its 2024 Diaz v. Cantu decision, in which it held that federal officers are entitled to qualified immunity when it is unclear if they had a duty to intervene. “As we explained in Cantu,” said the court, “bystander liability has not been extended beyond the law enforcement context” and the employees could point to case law extending it. Thus, they failed to show they had a clearly established right to have the Commissioner intervene and prevent Shriners from terminating their employment.

The case is No. 24-40436.

Judge: Stewart, C.

Attorneys: David Joseph Schexnaydre (Schexnaydre Law Firm) for Jeri Pearson. Daniel F. Patton (Scott Patton) for Shriners Hospitals for Children.

Companies: Shriners Hospitals for Children, Inc.; Shriners Hospitals for Children, Texas

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