438 F.3d 544 (6th Cir. 2006), 03-4591, Eastman v. Marine Mechanical Corp.

Docket Nº:03-4591.
Citation:438 F.3d 544
Party Name:John T. EASTMAN, Plaintiff-Appellant, v. MARINE MECHANICAL CORPORATION, Defendant-Appellee.
Case Date:February 15, 2006
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit
 
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Page 544

438 F.3d 544 (6th Cir. 2006)

John T. EASTMAN, Plaintiff-Appellant,

v.

MARINE MECHANICAL CORPORATION, Defendant-Appellee.

No. 03-4591.

United States Court of Appeals, Sixth Circuit.

February 15, 2006.

Argued: June 7, 2005.

Appeal from the United States District Court for the Northern District of Ohio at Cleveland. No. 02-01314—Donald C. Nugent, District Judge.

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[Copyrighted Material Omitted]

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COUNSEL

ARGUED:

Steven D. Bell, SIMON LAW FIRM, Cleveland, Ohio, for Appellant.

Michael N. Chesney, FRANTZ WARD, Cleveland, Ohio, for Appellee.

ON BRIEF:

Steven D. Bell, Ann-Marie Ahern, SIMON LAW FIRM, Cleveland, Ohio, for Appellant.

Michael N. Chesney, Thomas Merritt Bumpass, Jr., FRANTZ WARD, Cleveland, Ohio, for Appellee.

Before: SILER and GIBBONS, Circuit Judges; LAWSON, District Judge.[*]

OPINION

DAVID M. LAWSON, District Judge.

Plaintiff John Eastman appeals from the decision of the district court granting the defendant's motion for summary judgment on an Ohio common-law claim of retaliatory employment discharge in violation of public policy. The complaint, originally filed in an Ohio state court, identified federal law as the source of the public policy violated by the defendant, and it was on that basis that the defendant claimed in its removal notice that the case "[arose] under the Constitution, treaties or laws of the United States," 28 U.S.C. §§ 1331, 1441(b), and thus was "removable without regard to the citizenship or residence of the parties." 28 U.S.C. § 1441(b). We hold, however, that the plaintiff's state-law employment claim alleging wrongful discharge in violation of federal public policy does not raise a substantial federal question over which federal courts may exercise original or removal jurisdiction, because accepting such cases would be "[in]consistent with congressional judgment about the sound division of labor between state and federal courts governing the application of § 1331." Grable & Sons Metal Prod., Inc. v. Darue Eng'g & Mfg., 545 U.S.---, 125 S.Ct. 2363, 2367 (2005). Because we find that the district court did not have subject matter jurisdiction to adjudicate the claim, we will vacate the district court's judgment and remand with instructions to remand the matter to the state court whence it came.

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I.

John T. Eastman, a resident of Ohio, began his employment with TRW, Inc., a corporate predecessor of the defendant, in 1984. He was trained in metallurgy at Case Western Reserve University, and he began in a position as a metallurgical engineer. The defendant, Marine Mechanical Corporation, manufactures component parts for nuclear reactors used on vessels of the United States Navy. It is an Ohio corporation.

Marine Mechanical's supply contract with the Navy's prime contractor calls for a demanding quality assurance program because the parts face exposure to extreme temperature, pressure, and irradiating conditions and must conform to the Navy's maintenance requirements. All employees must read and sign acknowledgments that they will adhere to Marine Mechanical's quality assurance program by reporting any contractual violations. Marine Mechanical emphasizes its expectations for employee adherence to this obligation in a procedure manual that specifically provides that employees must "bring possible violations of this policy" to a supervisor or officer of the company. J.A. at 198.

Over the last ten years of his employment, Eastman received high performance ratings and significant pay increases from the defendant each year. The defendant praised Eastman in a performance appraisal issued eight months before termination. Eastman advanced to the position of Manager of the Materials Engineering Section.

Eastman alleges, however, that he became a victim of a shift in his employer's business focus because of his steadfast adherence to quality control requirements, while the company turned its priorities toward production schedules and profitability at the expense of quality. On November 3, 2000, he claims Marine Mechanical's president demoted him from Manager of Materials Engineering to Principal Engineer after being informed that the company "wanted to be doing things faster." Eastman claims that the demotion was precipitated by his refusal to test a part in a way he believed would produce inaccurate results. Marine Mechanical contends the title change resulted from a new organizational structure but acknowledges that the change put Eastman under the supervision of Mark Centa, who previously had worked in a position subservient to Eastman.

On February 9, 2001, Eastman in his new position submitted a written memorandum notifying Marine Mechanical supervisors of quality control deficiencies, which included warnings that a certain process possibly violated Marine Mechanical's contractual obligations, the purchase of substandard fasteners used in products, and the receipt of certain component parts after a vendor inaccurately tested their hardness strength. Marine Mechanical conducted an investigation and concluded that Eastman's notification made unfounded allegations of fraud against Centa, Eastman's supervisor. On February 23, 2001, Eastman submitted a revised memorandum to clarify some unsupported statements made in the earlier memorandum. Marine Mechanical contended that the memoranda only identified problems that caused delay and cost increases and personally attacked Centa. It chastised Eastman with a written "Disciplinary Warning" on February 27, 2001.

Eastman continued in his position as Principal Engineer and regularly raised issues related to product quality as part of his normal duties. He alleges that the company became resistant to his quality control efforts. On July 23, 2001, Eastman submitted a letter responding to the

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earlier disciplinary warning and raising new product quality issues. The new letter alleged that others in the company had misrepresented some vendor requirements, failed to ensure accurate testing of a piece of wire, and used an uncertified welder to complete some work. Marine Mechanical says that it thoroughly investigated the allegations, concluded that the quality issues had been identified to the company's customer, and found no evidence of intentional misrepresentations made by employees. Although Eastman insists that his letter represented his attempt to comply with the stated company policies of identifying possible violations of quality control standards by this government contractor, Marine Mechanical determined that Eastman's letter constituted another attempt to discredit other employees.

According to Marine Mechanical, the July 2001 letter amounted to an act of misconduct in the same vein as Eastman's prior transgression in February 2001 for which he received his disciplinary warning. The defendant decided to fire him. Two company officers...

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