Ferrell v. Cross

• Decision Date: 16 January 1997
• Docket Number: No. C4-95-1043,C4-95-1043
• Parties: Lisa FERRELL, Respondent, v. Nancy CROSS, in her individual capacity, Petitioner, Appellant, and Marci Henderson, in her individual capacity, Petitioner, Appellant.
• Court: Minnesota Supreme Court

Page 560

557 N.W.2d 560

Lisa FERRELL, Respondent, v. Nancy CROSS, in her individual capacity, Petitioner, Appellant and Marci Henderson, in her individual capacity, Petitioner, Appellant.

No. C4-95-1043.

Supreme Court of Minnesota.

Jan. 16, 1997.

Syllabus by the Court

On the facts presented, respondent's state law tort claims for defamation and intentional infliction of emotional distress are not preempted by the Railway Labor Act.

Huffman, Usem, Saboe, Crawford and Greenberg, Ronald H. Usem, Minneapolis, for Appellant Henderson.

Dorsey & Whitney LLP, Carol A. Peterson, Minneapolis, for Appellant Cross.

Steve G. Heikens, Minneapolis, for Respondent Ferrell.

Heard, considered, and decided by the court en banc.

OPINION

PAGE, Justice.

We are asked to determine whether this action, brought by a Northwest Airlines (Northwest) employee, alleging state tort law claims of defamation and intentional infliction of emotional distress, ¹ is preempted by the Railway Labor Act (Act), 45 U.S.C. § 151. Respondent Lisa Ferrell commenced this action in August 1994 against two of her co-workers, appellants Nancy Cross and Marci Henderson. Cross and Henderson moved to dismiss the complaint based on their assertion that the district court lacked jurisdiction and that Ferrell's claims were preempted by the Act. The district court agreed with Cross and Henderson and dismissed Ferrell's complaint. The district court based its decision on its conclusion that Ferrell's claims were preempted because their resolution would require the court to interpret the collective bargaining agreement between the exclusive bargaining representative for Northwest's employees, the Transport Workers Union (Union), and Northwest. ² The court of appeals reversed. The court of appeals, following the United States Supreme Court's decision in Hawaiian Airlines v. Norris, 512 U.S. 246, 114 S.Ct. 2239, 129 L.Ed.2d 203 (1994), concluded that "the RLA does not preempt claims where there is no need to interpret a CBA" and that interpretation of the collective bargaining agreement was not necessary for resolution of Ferrell's state law claims. We affirm the court of appeals.

Ferrell was employed by Northwest as an Operations Planner Assistant. Henderson was also employed by Northwest as an Operations Planner Assistant. Cross was a Senior Operations Planner Assistant at Northwest and had supervisory responsibility for work scheduling and work assignments for Operations Planner Assistants. Ferrell, Cross, and Henderson were all members of the Union. The terms and conditions of their employment were governed by the collective bargaining agreement (CBA) negotiated between the Union and Northwest and by Northwest's Rules of Conduct, which were incorporated into the CBA as general company rules. The CBA covers, among other things, employee duties, hours, scheduling, leaves of absence, grievances, and discipline. Northwest's Rules of Conduct specifically prohibit "[h]arassing, threatening, intimidating, assaulting, fighting or provoking a fight or similar interference with other employees at any time, on or off duty." The Rules also prohibit employees from "spread[ing] false or malicious rumors concerning the Company or any of its employees."

In September 1991, Ferrell filed a grievance alleging incorrect work scheduling under the CBA's grievance procedure. Northwest's investigation of the grievance revealed that the work scheduling provisions of the CBA had not been followed. As a result, Northwest implemented new work scheduling procedures. Ferrell also filed four grievances under the CBA in 1993, each raising an issue regarding work scheduling or compensation. Two of these grievances were settled and two were denied. In October 1993, Ferrell complained to Northwest that her prior grievances had resulted in Cross, Henderson, and others creating a hostile and intimidating workplace environment. Northwest's investigation into this complaint resulted in Henderson being disciplined. Later, in October 1993, Ferrell, after suffering a severe "panic attack," took a medical leave of absence. She returned to work in November 1993. According to Ferrell, the hostile and intimidating workplace environment continued upon her return. As a result, she applied for, and was granted, a long-term leave of absence without pay. In the summer of 1994, Ferrell filed a complaint with the Union against Cross, alleging harassment, intimidation, retribution, and that Cross' actions toward her violated the Union constitution. The Union denied the complaint.

Ferrell subsequently commenced this action. In her complaint, Ferrell claims that Henderson, among other things, insulted and intimidated her; berated her when she took medical leave; deliberately created errors in her work; directed other employees not to talk to her; directed other employees to shun and ostracize her; and falsified reports to management concerning the quality of her performance. Ferrell's complaint alleges that Cross was aware of, approved of, and participated in Henderson's conduct. The complaint further alleges that Cross humiliated Ferrell by publicly disclosing facts about her medical leave and surgery; spread false rumors about her medical leave; coerced her into taking unpaid leave; ridiculed her medical condition; took actions which delayed her medical leave; attempted to "build a file" to get her fired; picked through her trash to retrieve evidence of her errors; and engaged in efforts designed to degrade her and to make her appear incompetent. The complaint also alleges that Cross and Henderson called Ferrell a liar, mentally unstable, a chronic complainer, and often referred to her as a "bitch," a "slut," and a "cunt." According to the complaint, Henderson and Cross said these things in front of other employees. Ferrell claims that these actions by Cross and Henderson caused her to suffer severe emotional distress, depression, sleeplessness, humiliation, embarrassment, damage to her reputation and standing in the community, as well as pain and suffering. Henderson and Cross contend that Ferrell's state law claims involve conduct which constitute minor ³ disputes under the Act and are therefore preempted by the Act.

National labor policy favoring collective bargaining and industrial self-government is set forth by Congress in the Act, 45 U.S.C. §§ 151-163, 181-184. The purpose of the policy is to provide stability in the railroad industry between labor and management. Bhd. of R.R. Trainmen v. Chicago R. & I.R. Co., 353 U.S. 30, 40, 77 S.Ct. 635, 640, 1 L.Ed.2d 622 (1957). The provisions of the Act apply to air carriers. Air Line Stewards and Stewardesses Ass'n. v. Northwest Airlines, Inc., 267 F.2d 170, 173 (8th Cir.1959), cert. denied, 361 U.S. 901, 80 S.Ct. 208, 4 L.Ed.2d 156 (1959). The Act provides a comprehensive framework for the resolution of labor disputes in the airline industry. Hawaiian Airlines v. Norris, 512 U.S. at 252, 114 S.Ct. at 2243.

Whether the Act preempts a state law cause of action is a question of congressional intent. Id. When it is clear or may fairly be assumed that the activities which the state purports to regulate are protected by federal labor law, or constitute an unfair labor practice, causes of action arising under state law are preempted. Lingle v. Norge Division of Magic Chef, Inc., 486 U.S. 399, 409 n. 8, 108 S.Ct. 1877, 1883 n. 8, 100 L.Ed.2d 410 (1988) (quoting San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 244, 79 S.Ct. 773, 779, 3 L.Ed.2d 775 (1959)). To allow the states to regulate conduct plainly within the central aim of federal regulation involves a danger of conflict between national labor policy as articulated by Congress and the requirements imposed by state law. See Farmer, Special Adm'r. v. United Bhd. of Carpenters & Joiners of America, Local 25, et al., 430 U.S. 290, 296, 97 S.Ct. 1056, 1061, 51 L.Ed.2d 338 (1977) (stating that "[t]o leave the States free to regulate conduct so plainly within the central aim of federal regulation involves too great a danger of conflict between power asserted by Congress, and requirements imposed by state law.") (quoting Garmon, 359 U.S. at 244, 79 S.Ct. at 779). However, "in the absence of compelling congressional direction, we [will] not infer that Congress had deprived the States of the power to act." Id. at 296-97, 97 S.Ct. at 1061 (quoting Garmon, 359 U.S. at 244, 79 S.Ct. at 779). No provision of the Act provides such compelling congressional direction.

Even if there is no compelling congressional direction, state law claims will still be preempted when the state law cause of action involves rights and obligations that are not independent of the applicable CBA or require interpretation of that agreement. See Norris, 512 U.S. at 256-62, 114 S.Ct. at 2245-2249. In the absence of compelling congressional direction, preemption of state law claims occurs when the state law claim is "inextricably intertwined" with consideration of the labor contract or when resolution of the state law claim "substantially depends" on the terms and provisions of the CBA. Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 213, 220, 105 S.Ct. 1904, 1912, 1915-16, 85 L.Ed.2d 206 (1985). Preemption will not apply, however, where a state law remedy is independent of the CBA. Lingle, 486 U.S. at 407, 108 S.Ct. at 1882. This is so even if analysis of the same set of facts would be required to resolve a dispute arising directly under the CBA and a dispute arising under state tort law. Id. at 410, 108 S.Ct. at 1883-84. When the activity regulated is a peripheral concern of the federal law or when the regulated conduct touches local or state interests, in the absence of compelling congressional direction, we should not infer that Congress deprived the states of the power to act. Linn v. United Plant Guard Workers, 383 U.S. 53, 59, 86 S.Ct. 657, 661, 15 L.Ed.2d 582 (1966) (quoting Garmon, 359 U.S. at 243-44, 79 S.Ct. at 778-79). "...