Atchley v. Heritage Cable Vision Associates

• Decision Date: 10 October 1995
• Docket Number: No. 3:95-CV-432RM.,3:95-CV-432RM.
• Citation: 904 F. Supp. 870
• Parties: Glenn L. ATCHLEY, et al., Plaintiffs, v. HERITAGE CABLE VISION ASSOCIATES, Defendant.
• Court: U.S. District Court — Northern District of Indiana

904 F. Supp. 870

Glenn L. ATCHLEY, et al., Plaintiffs, v. HERITAGE CABLE VISION ASSOCIATES, Defendant.

No. 3:95-CV-432RM.

United States District Court, N.D. Indiana, South Bend Division.

October 10, 1995.

COPYRIGHT MATERIAL OMITTED

William R. Groth, Fillenwarth Dennerline Groth and Towe, Indianapolis, IN, for plaintiffs.

Timothy W. Woods, Jones Obenchain Ford Pankow and Lewis, South Bend, IN, Eric P. Simon, Kreitzman Mortensen and Simon, New York City, for defendant.

MEMORANDUM AND ORDER

MILLER, District Judge.

This cause comes before the court on the plaintiffs' motion to remand this action as improvidently removed. Also pending in this cause is a motion to dismiss for failure to state a claim filed by defendant Heritage Cable Vision Associates d/b/a TCI of MICHIANA. Because the plaintiffs need not respond to the defendants' motion to dismiss until after the remand motion is resolved, only the motion to remand is considered here.

I. BACKGROUND

A. Procedural History

Glenn Atchley and other members of the International Brotherhood of Electrical Workers, Local Union No. 1393, ("IBEW") filed this action in St. Joseph County Circuit Court. The complaint alleges that TCI of Michiana ("TCI") violated IND.CODE § 22-2-5-1 (the "Wage Payment Statute") by its delinquent payment of wage increases and signing bonuses to the plaintiffs. Article 7 of the collective bargaining agreement ("CBA") between IBEW and TCI provides for the wage increases. The signing bonuses were agreed upon during negotiations that preceded the execution of the CBA. The complaint further alleges that the plaintiffs are entitled to liquidated damages, pursuant to IND. CODE § 22-2-5-2, for TCI's failure to pay the additional money in a timely fashion. Thus, the complaint frames the plaintiffs' cause of action as one arising under Indiana statutory law.

Heritage filed a Notice of Removal contending that the plaintiffs' complaint alleges a breach of an obligation created by the CBA between IBEW and TCI which must, pursuant to § 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185, be resolved in a federal forum. The Notice alleges that removal of the action is proper because this court has original jurisdiction pursuant to 28 U.S.C. §§ 1331, 1441 and 1446 and the LMRA.

Heritage also filed a motion to dismiss in this court. The motion argues that § 301 of the LMRA completely preempts the plaintiffs' state law claims and that because the plaintiffs did not exhaust grievance and arbitration procedures, the complaint states no claim upon which relief can be granted.

The plaintiffs seek the case's remand to the St. Joseph Circuit Court pursuant to 28 U.S.C. § 1447(c). The plaintiffs argue that the claims presented and the remedies sought in the complaint arise exclusively out of Indiana statutory law. The plaintiffs assert that their claim to enforce independent rights created by statute does not require interpretation or analysis of the CBA because the only remedies they seek are those provided by the Wage Payment Statute. Thus, the plaintiffs argue, there is neither federal preemption nor federal jurisdiction under the LMRA. Heritage argues that the plaintiffs' complaint, although framed as a claim arising under state law, actually alleges a breach of obligations created by the CBA and that resolution of this claim will require interpretation of the CBA.

B. Facts

The essential facts are clearly delineated in the pleadings. TCI and the plaintiffs are parties to a CBA effective from December 8, 1994 to September 15, 1996. Negotiations for this contract began in August of 1994 and continued through November 28, 1994, when TCI presented a final offer to IBEW. This offer included a 40 cents per hour across the board wage increase to all employees who were members of the bargaining unit. The wage increase was to become effective for members of the unit, except for those employees who were still under a probationary period, the first payroll period following ratification of the agreement. During the course of negotiations, TCI also agreed to provide a $100.00 ratification or signing bonus to each of the plaintiffs at the time their wage increases were paid.

IBEW ratified the contract on December 8, 1994. The next pay period commenced on December 10. On December 12, TCI's attorney advised IBEW that the wage increases and bonuses would be processed upon IBEW's execution of the contract. The plaintiffs, through their IBEW representative, made a verbal demand on or about December 19 for the hourly wage increase, retroactive to December 8, and for the $100.00 bonuses. Checks that were issued on December 23, reflecting the first pay period following ratification of the contract, did not include the $100.00 per unit member bonus nor the 40 cents per hour across the board wage increase.

On January 9, an IBEW shop steward (one of the plaintiffs in this case) filed a grievance pursuant to the CBA's terms alleging that TCI had violated Article 7 by failing to implement the wage increases. The grievance was denied, but the paychecks the plaintiffs received on January 20 included the 40 cents per hour wage increase retroactive to December 10. The IBEW shop steward then advanced the grievance to the second step; TCI denied the grievance at that stage, and IBEW did not advance the grievance to arbitration.

The contract was executed by TCI on January 26 and by IBEW on February 6. The $100.00 per employee bonus was included in paychecks the plaintiffs received on or about February 10.

II. DISCUSSION

A federal district court has original jurisdiction over any civil action that arises under the "Constitution, laws, or treaties of the United States." 28 U.S.C. § 1331. Section 301(a) of the LMRA provides that suits for violation of contracts between an employer and a labor organization present a federal question that arises under federal law, thus conferring original jurisdiction upon district courts. 29 U.S.C. § 185(a). TCI asserts that this court has subject matter jurisdiction because the complaint actually alleges a violation of the CBA, while the plaintiffs claim that their complaint alleges an action arising under Indiana law.

Removal may be challenged, and an action subsequently remanded, either for procedural defects or for the absence of subject matter jurisdiction. 28 U.S.C. § 1447(c); In re Continental Casualty Co., 29 F.3d 292, 293 (7th Cir.1994). In the absence of subject matter jurisdiction, "the case shall be remanded." 28 U.S.C. § 1447(c). The existence of federal question jurisdiction is determined by the "well-pleaded complaint rule": federal question jurisdiction exists only where the federal question appears on the face of the plaintiff's properly pleaded complaint. Caterpillar Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 2429, 96 L.Ed.2d 318 (1987). A case may not be removed on the basis of a federal defense, id. at 393, 107 S.Ct. at 2430, but a plaintiff cannot "`deny a defendant his right to a federal forum by artfully disguising an essentially federal law claim in terms of state law.'" Sluder v. United Mine Workers, 892 F.2d 549 (7th Cir.1989), cert. denied, 498 U.S. 810, 111 S.Ct. 45, 112 L.Ed.2d 21 (1990) (quoting Oglesby v. RCA Corp., 752 F.2d 272, 275 (7th Cir.1985)).

"The Supremacy Clause of Art. VI of the United States Constitution grants to Congress the power to preempt state law. Congress exercised this power by enacting § 301(a) of the LMRA, 29 U.S.C. § 185(a)...." Loewen Group Int'l, Inc. v. Haberichter, 65 F.3d 1417, 1420 (7th Cir. 1995) (citations omitted). Section 301(a) of the LMRA provides:

Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this Act, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of parties.

29 U.S.C. § 185(a). In addition to providing federal jurisdiction over actions involving collective bargaining agreements, § 301 authorizes federal courts to fashion federal common law for enforcement of these agreements. Textile Workers v. Lincoln Mills, 353 U.S. 448, 77 S.Ct. 912, 1 L.Ed.2d 972 (1957); see also Loewen Group Int'l, Inc. v. Haberichter, 65 F.3d at 1421 ("This section provides federal court jurisdiction over controversies involving collective bargaining agreements and also authorizes federal courts to fashion a body of federal law for the enforcement of those agreements."). A court must apply federal law when resolving such disputes to "ensure uniform interpretation of collective-bargaining agreements, and thus to promote the peaceable, consistent resolution of labor-management disputes." Lingle v. Norge Division of Magic Chef, 486 U.S. 399, 404, 108 S.Ct. 1877, 1880, 100 L.Ed.2d 410 (1988) (citing Teamsters v. Lucas Flour Co., 369 U.S. 95, 82 S.Ct. 571, 7 L.Ed.2d 593 (1962)); see also Loewen Group Int'l. Inc. v. Haberichter, 65 F.3d at 1421.

Determining whether the claim arises under state law or whether the claim actually alleges breach of a collective bargaining agreement is important because the "preemptive force of § 301 is so powerful as to displace entirely any state cause of action `for violation of contracts between an employer and a labor organization.'" Caterpillar v. Williams, 482 U.S. at 394, 107 S.Ct. at 2430 (quoting Franchise Tax Board v. Construction Laborers Vacation Trust, 463 U.S. 1, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983)). If the state law claim can be resolved without interpreting the collective bargaining agreement, the claim is independent and not preempted by § 301. If, however, the resolution of a state law claim depends on the meaning of a collective bargaining agreement, the application of state law is preempted and federal labor law principles must be employed to resolve the dispute....