Lobo v. Celebrity Cruises, Inc.

• Decision Date: 07 January 2013
• Docket Number: Nos. 10–13623,10–10406.,s. 10–13623
• Citation: 704 F.3d 882
• Parties: Inacio LOBO, John Gomez, et al., each on their own behalf and on behalf of all other current and former employees of Celebrity Cruises, Inc. similarly situated, Plaintiffs, Inacio Lobo, John Gomez, Joao Rodrigues, Raimundo Rebello, Antonio Menezes, Lazaro D'Costa, Menino Serrao, Luis Pereira, Alexio Fernandes, Agnelo Fernandes, Minguel Pereira, Plaintiffs–Appellants, v. CELEBRITY CRUISES, INC., Federazione Italianan Transporti, Defendants–Appellees. John Gomez, Joao Rodrigues, et al., each on their own behalf and on behalf of all other current and former employees of Celebrity Cruises, Inc. similarly situated, Plaintiffs, John Gomez, Joao Rodrigues, Raimundo Rebello, Agenelo Antonio Menezes, Lazaro D'Costa, Menino Serrao, Luis Pereira, Alexio Fernandes, Agnelo Fernandes, Minguel Pereira, Plaintiffs–Appellants, v. Celebrity Cruises, Inc., Defendant–Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

704 F.3d 882

Inacio LOBO, John Gomez, et al., each on their own behalf and on behalf of all other current and former employees of Celebrity Cruises, Inc. similarly situated, Plaintiffs,

Inacio Lobo, John Gomez, Joao Rodrigues, Raimundo Rebello, Antonio Menezes, Lazaro D'Costa, Menino Serrao, Luis Pereira, Alexio Fernandes, Agnelo Fernandes, Minguel Pereira, Plaintiffs–Appellants,

v.CELEBRITY CRUISES, INC., Federazione Italianan Transporti, Defendants–Appellees.

John Gomez, Joao Rodrigues, et al., each on their own behalf and on behalf of all other current and former employees of Celebrity Cruises, Inc. similarly situated, Plaintiffs,

John Gomez, Joao Rodrigues, Raimundo Rebello, Agenelo Antonio Menezes, Lazaro D'Costa, Menino Serrao, Luis Pereira, Alexio Fernandes, Agnelo Fernandes, Minguel Pereira, Plaintiffs–Appellants,

v.Celebrity Cruises, Inc., Defendant–Appellee.

Nos. 10–13623, 10–10406.

United States Court of Appeals,Eleventh Circuit.

Jan. 7, 2013.

Charles R. Lipcon, Carlos Felipe Llinas Negret, Jason Robert Margulies, Michael A. Winkleman, Lipcon, Margulies, Alsina & Winkleman, PA, Tonya Jean Meister, Meister Law, LLC, Miami, FL, for Plaintiffs–Appellants.

Sanford L. Bohrer, Scott Daniel Ponce, Holland & Knight, LLP, Kathleen M. Phillips, Holly Ellen Van Horsten, Phillips Richard & Rind, PA, Miami, FL, Richard J. Dodson, Dodson, Hooks & Frederick, APLC, Baton Rouge, LA, for Defendants–Appellees.

Appeals from the United States District Court for the Southern District of Florida.

Before TJOFLAT, PRYOR and RIPPLE,^* Circuit Judges.

TJOFLAT, Circuit Judge:

I.

A.

In Lobo v. Celebrity Cruises, Inc. (“ Lobo I”), 488 F.3d 891 (11th Cir.2007), we held that the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“Convention”) and its implementing legislation, 9 U.S.C. §§ 202–208, superceded the Seaman's Wage Act, 46 U.S.C. § 10313, and required the District Court to grant a motion to compel arbitration of a foreign seaman's claim for wages allegedly due under a collective bargaining agreement. We accordingly affirmed the District Court's order compelling the arbitration of a cabin steward's claim for wages—in the form of tips passengers paid for his services—that his employer, a cruise line, allegedly withheld.¹

The cabin steward was Inacio Lobo. After his case was submitted to arbitration, Lobo became dissatisfied with the representation his union, Federazione Italianan Transporti (“FIT”), was providing him; so he returned to the District Court—this time with a class action² against the union and the cruise line under section 301 of the Labor Management Relations Act (“LMRA”), 29 U.S.C. § 185,³ asserting both hybrid and non-hybrid claims for the tips he and other cabin stewards had not received.⁴Lobo v. Celebrity Cruises, Inc. (“ Lobo II”), 667 F.Supp.2d 1324 (S.D.Fla.2009). His hybrid claim against his employer, Celebrity Cruises, Inc. (“Celebrity”), was that it breached the wage provisions of the collective bargaining agreement (“CBA”) it had with FIT. His hybrid claim against FIT was that it breached the duty of fair representation it owed him under § 9(a) of the National Labor Relations Act (“NLRA”), 29 U.S.C. § 159.⁵ Lobo's non-hybrid claim was lodged against FIT; it replicated the § 9(a) allegations of the hybrid claim.

Lobo and the members of the putative class were citizens and residents of India. FIT is an Italian union. Celebrity is a Liberian corporation; its cruise ships are registered in the Bahamas. The defendants, citing Benz v. Compania Naviera Hidalgo, S.A., 353 U.S. 138, 77 S.Ct. 699, 1 L.Ed.2d 709 (1957) and McCulloch v. Sociedad Nacional de Marineros de Honduras, 372 U.S. 10, 83 S.Ct. 671, 9 L.Ed.2d 547 (1963), separately moved the District Court to dismiss Lobo's complaint under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim for relief. FIT also moved the court to dismiss it from the case under Federal Rule of Civil Procedure 12(b)(5) for insufficient service of process. In an order entered on September 10, 2009, the court granted FIT's Rule 12(b)(5) motion and dismissed the complaint against it without prejudice. It agreed with both defendants that Benz foreclosed Lobo's hybrid claims; as Benz explicitly held, the LMRA does not apply to labor disputes between foreign crew members and a foreign ship owner. 353 U.S. at 143, 77 S.Ct. at 702. The court therefore dismissed the complaint as to Celebrity with prejudice.

B.

After perfecting service of process on FIT, Lobo filed an amended complaint against FIT alone. He reasserted a non-hybrid breach of fair representation claim under § 9(a) as well as under federal common law. He also added a state law claim for breach of a duty of “good faith and fair dealing.”⁶ FIT moved the District Court to dismiss the amended complaint under Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction. On July 7, 2010, the court granted the motion. In its view, since the non-hybrid claim could not be brought under the LMRA and the NLRA, the court lacked the subject matter jurisdiction needed to entertain the amended complaint. On July 8, 2010, the District Court, in conformance with its orders of September 10, 2009, and July 7, 2010, entered final judgment in favor of Celebrity and FIT.

C.

While Lobo II was pending in the District Court, John Gomez and nine of the cabin stewards named in that case brought a class action against Celebrity under the Seaman's Wage Act, seeking damages in the amount of the tips Celebrity had allegedly withheld. Gomez v. Celebrity Cruises, Inc., No. 09–22991 (S.D.Fla.2009).⁷ Rather than invoking the arbitration provision of the CBA, Celebrity moved the court to dismiss the case under the doctrine of res judicata. Celebrity argued that the plaintiffs should have, but did not, assert their Seaman's Wage Act claim in Lobo II. The District Court agreed and on December 23, 2009, dismissed the case with prejudice.⁸

Gomez and the nine other cabin stewards who had joined him in Lobo II and Gomez (the “Stewards”) appealed the District Court's judgments in both cases, Appeal Nos. 10–13623 and 10–10406, respectively. We address the appeals separately, beginning with Lobo II.

II.

A.

The hybrid claims in Lobo II were dismissed under Rule 12(b)(6) for failure to state a claim. We review Rule 12(b)(6) dismissals de novo, accepting the allegations in the complaint as true and construing them in the light most favorable to the plaintiff. Hill v. White, 321 F.3d 1334, 1335 (11th Cir.2003).

The District Court dismissed the Stewards' hybrid claims against Celebrity and FIT after determining that the Supreme Court's decisions in Benz and McCulloch foreclosed the application of the LMRA and the NLRA to wage disputes between foreign ships and foreign seamen.⁹ We agree.

It is well-settled that these statutes do not apply to wholly-foreign disputes. In Benz, the Supreme Court concluded that “Congress did not fashion [the LMRA] to resolve labor disputes between nationals of other countries operating ships under foreign laws. The whole background of the Act is concerned with industrial strife between American employers and employees.” 353 U.S. at 143–44, 77 S.Ct. at 702. The Benz court found this legislative history compelling, as “inescapably describ[ing] the boundaries of the Act as including only the workingmen of our own country and its possessions.” Id. at 144, 77 S.Ct. at 703. Similarly, the Supreme Court has held that the NLRA does not extend to foreign crews working aboard foreign ships because such an application would interfere with the “internal management and affairs” of the ship. McCulloch, 372 U.S. at 20–21, 83 S.Ct. at 677. Thus, as the Supreme Court indicated in Spector v. Norwegian Cruise Line Ltd., 545 U.S. 119, 130, 125 S.Ct. 2169, 2177, 162 L.Ed.2d 97 (2005), Benz and McCulloch stand for the proposition that “[a]bsent a clear statement of congressional intent, general statutes [like the LMRA or the NLRA] may not apply to foreign-flag vessels insofar as they regulate matters that involve only the internal order and discipline of the vessel.”

We need not labor long to determine whether a wage dispute between a foreign-flag vessel and its foreign crew falls within the internal affairs of a ship. Benz and McCulloch have plainly answered that question. See Benz, 353 U.S. at 142–44, 77 S.Ct. at 701–02 (holding the LMRA inapplicable to the picketing of a foreign ship operated entirely by foreign seamen); McCulloch, 372 U.S. at 12–13, 83 S.Ct. at 672–73 (holding that the National Labor Relations Board could not order a union election because the NLRA did not apply to foreign seamen aboard foreign vessels). As the Supreme Court has made clear, the LMRA and NLRA do not apply to “wage disputes arising on foreign vessels between nationals of other countries,” even when “the vessel comes within our territorial waters.”¹⁰Benz, 353 U.S. at 142, 77 S.Ct. at 702.

Here, the Stewards are engaged in a wage dispute with their employer, Celebrity, and their labor union, FIT. All parties in this dispute are foreign. The holdings of Benz and McCulloch control.

The Stewards contend that Benz is inapplicable. They attempt to distinguish the case by noting that Benz concerned the picketing of ships, whereas the Stewards' claim concerns a contractual breach over wages. The seamen in Benz, however, were picketing because they “demanded that their term of service be reduced, their wages be increased, and more favorable conditions of employment be granted.” 353 U.S. at 139, 77 S.Ct. at 700. Just like the Stewards, the Benz plaintiffs were engaged in (among other things) a wage dispute arising from their employment contract with their foreign-flag vessel. The LMRA does not apply to these disputes.

The Stewards next argue that, even if Benz is on point, it was implicitly overruled by Hellenic Lines, Ltd. v. Rhoditis, 398 U.S. 306, 90 S.Ct. 1731, 26 L.Ed.2d 252 (1970). According to the Stewards, ...