Baldridge v. Kentucky-Ohio Transp., Inc.

• Decision Date: 09 March 1993
• Docket Number: No. 91-6379,KENTUCKY-OHIO,91-6379
• Citation: 983 F.2d 1341
• Parties: 142 L.R.R.M. (BNA) 2469, 124 Lab.Cas. P 10,569, 8 IER Cases 1453 William BALDRIDGE; Ralph Hunt; Richard Lake; Danny Dale Mattox; Marce M. Smith; Robert Hamilton; David Munn; Norman Wiler; Dennis Klaiber; William Spencer; Daniel Gray; James E. Johnson; and Ronald Dillow, Plaintiffs-Appellees, v.TRANSPORTATION, INC.; Island Creek Corporation, Defendants-Appellants, United Mine Workers of America, Region 1, Defendant.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 1341

983 F.2d 1341

142 L.R.R.M. (BNA) 2469, 124 Lab.Cas. P 10,569,

8 IER Cases 1453

William BALDRIDGE; Ralph Hunt; Richard Lake; Danny Dale

Mattox; Marce M. Smith; Robert Hamilton; David Munn;

Norman Wiler; Dennis Klaiber; William Spencer; Daniel

Gray; James E. Johnson; and Ronald Dillow, Plaintiffs-Appellees, v. KENTUCKY-OHIO TRANSPORTATION, INC.; Island Creek

Corporation, Defendants-Appellants,

United Mine Workers of America, Region 1, Defendant.

No. 91-6379.

United States Court of Appeals, Sixth Circuit.

Argued Oct. 8, 1992.

Decided Jan. 14, 1993.

Rehearing and Rehearing En Banc

Denied March 9, 1993.

Dwight O. Bailey, Bailey, Hensley & Leadingham, Flatwoods, KY (argued and briefed), for plaintiffs-appellees.

William A. Hoskins, III (argued and briefed), Timothy R. Coleman, Jackson & Kelly, Lexington, KY, for defendants-appellants.

Before: GUY and BATCHELDER, Circuit Judges; and CELEBREZZE, Senior Circuit Judge.

RALPH B. GUY, Jr., Circuit Judge.

Arguing preemption under federal labor law, defendant employer appeals the remand to state court of former employees' claims challenging their discharge. The thrust of plaintiffs' suit, which had been removed from state to federal court, was that defendants had fired them for attempting to organize and join the United Mine Workers Union. We do not reach the preemption issue because our review of the record causes us to conclude that we lack jurisdiction to consider this appeal, and accordingly dismiss it.

I.

The thirteen plaintiffs were formerly employed by defendant Kentucky-Ohio Transportation, Inc. (KOT), a wholly owned subsidiary of defendant Island Creek Corporation (Island Creek). Plaintiffs had signed union authorization cards and had otherwise been active in efforts to unionize KOT's South Shore facility. The United Mine Workers Union represented other Island Creek employees, but the collective bargaining agreement did not cover these plaintiffs. After their termination, following the sale of the South Shore facility, plaintiffs filed a complaint with the National Labor Relations Board alleging the same facts and claims asserted in the current matter. At some unspecified time, but apparently before plaintiffs initiated the present suit, ¹ the NLRB declined to file a complaint against defendants. Plaintiffs did not appeal the board's decision.

Instead, plaintiffs filed a wrongful discharge and breach of contract suit in Kentucky court, claiming that their termination violated public policy in favor of the right to organize and contravened certain company policies and procedures as expressed in the employee handbook. Plaintiffs also claimed that the United Mine Workers Union breached its duty of fair representation for, among other things, failing to protect their jobs. The complaint also alleged that KOT, Island Creek, and the union acted in bad faith in failing to honor an alleged agreement that the union would be deemed the collective bargaining unit for KOT employees when a majority of them signed union authorization cards. ²

Defendants removed the case to federal court on the basis of federal question jurisdiction. The defendant corporations then moved for dismissal or summary judgment, arguing that the challenged actions were essentially unfair labor practices and required the interpretation of a collective bargaining agreement, and were therefore preempted by federal labor law. Finding that the NLRB had not designated the union as the exclusive bargaining representative for KOT employees, the district court dismissed the action against the union.

The district court then agreed that the state law claims against KOT and Island Creek essentially amounted to unfair labor practices under 29 U.S.C. §§ 157 and 158, such as to fall within the exclusive jurisdiction of the NLRB. The court concluded, however, that the NLRB's refusal to issue a complaint left the Kentucky courts "free to hear the present matter on applicable state law theories." Believing that the claims for wrongful discharge, breach of contract, and outrageous conduct could be resolved only by reference to state law, the court stated that it "lack[ed] subject matter jurisdiction" and remanded the case "pursuant to 28 U.S.C. § 1447 for proper disposition under Kentucky law."

KOT and Island Creek appeal the remand order, requesting that this court order the case returned to the district court for dismissal on grounds of preemption. ³ The union is not a party to this appeal.

II.

Although plaintiffs do not contest defendants' claim that this court has authority to consider this appeal, we are obligated to ensure that we have jurisdiction over this matter. An order of remand on jurisdictional grounds is neither a final judgment for purposes of 28 U.S.C. § 1291 nor a ruling falling within the "collateral order" exception to that rule. Beard v. Carrollton R.R., 893 F.2d 117, 120 (6th Cir.1989). More importantly, however, we face the seemingly ironclad bar to review--no matter how the appeal is fashioned--which is contained in 28 U.S.C. § 1447(d). With an exception not relevant here, § 1447(d) declares: "An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise...." If this statute meant what is says, that would be an end of the matter and our review clearly would be foreclosed.

The Supreme Court stated long ago, however, that the § 1447(d) proscription is not as broad as it seems. In Thermtron Products, Inc. v. Hermansdorfer, 423 U.S. 336, 96 S.Ct. 584, 46 L.Ed.2d 542 (1976), the district judge had remanded a diversity suit due to the crowded federal docket. The judge did not question the jurisdictional propriety of the removal. Relying on § 1447(d), the Sixth Circuit refused to consider the defendant's mandamus petition, which requested relief on the ground that the district judge had been powerless to order remand for the reason he had given.

The Supreme Court reversed, holding that § 1447(d) precludes review only of those remand orders issued pursuant to § 1447(c). As § 1447(c) then read:

If at any time before final judgment it appears that the case was removed improvidently and without jurisdiction, the district court shall remand the case.... ⁴

In Thermtron, the district judge had not purported to remand on a § 1447(c) basis; the statute was never mentioned and there was no suggestion that the case had been removed "improvidently and without jurisdiction." Since the remand had instead been based "on grounds wholly different from those upon which § 1447(c) permits remand," 423 U.S. at 344, 96 S.Ct. at 589, the judge had exceeded his authority and the remand order was reviewable.

In Carnegie-Mellon University v. Cohill, 484 U.S. 343, 108 S.Ct. 614, 98 L.Ed.2d 720 (1988), the Court reaffirmed that the facially unequivocal language of § 1447(d) does not, in fact, preclude review of all remand orders. The district court in that case had remanded pendent state claims after the plaintiffs had withdrawn their lone federal claim. Remand had not been predicated on any provisions in the removal statutes. Section 1447(c) did not apply because removal of the case (federal and related state claims together) had been proper, and § 1441(c), authorizing discretionary remand of "separate and independent" claims, did not apply because the state claims had been pendent to the federal claim. Reviewing this non-statutorily-based remand, the Supreme Court resolved a circuit split and clarified that the doctrine of pendent jurisdiction does indeed allow district courts to remand pendent state claims. The Court repudiated Thermtron 's implication that remand orders could be based only on the grounds specified in the removal statute. Carnegie-Mellon, 484 U.S. at 355-56, 108 S.Ct. at 621-22. Finally, since the remand had not been based on § 1447(c), it was subject to review by extraordinary writ.

Since Thermtron, appellate courts have paved other detours around § 1447(d)'s bar to review. Under the so-called Pelleport/ Clorox doctrine first advanced by the Ninth Circuit, a remand based upon the district court's resolution of "a substantive [issue] on the merits apart from any jurisdictional decision" was reviewable as a final order. Pelleport Investors, Inc. v. Budco Quality Theatres, 741 F.2d 273, 276 (9th Cir.1984). The remand in Pelleport --a diversity case--was not based on lack of subject matter jurisdiction or any defect in removal but, rather, on the court's determination that the parties' forum-selection agreement was enforceable. To immunize this variety of remand orders from review "would deprive [the objecting party] of its right to appeal a substantive determination of contract law," a determination that was conclusive on the parties. Id. at 277. The court noted that the policy behind § 1447(d) is to prevent parties from using "the appeal process to protract litigation over jurisdictional issues." Id. This policy is "inapplicable," however,

where a district court bypasses the jurisdictional arguments and reaches the merits of a contract dispute.... Any delay caused by an appeal of the contract issue is a delay which must be countenanced.

Id.

The Ninth Circuit subsequently relied on Pelleport to review a remand order that had been based on a district court's conclusion that the defendant had contractually waived its removal rights. Clorox Co. v. United States Dist. Court, 779 F.2d 517 (9th Cir.1985). Like the remand in Pelleport, the Clorox remand turned on the consideration of a collateral, non-jurisdictional issue, and thus fell outside the purview of § 1447(d).

This circuit endorsed the Ninth Circuit's reasoning, concluding that § 1447(d) did not bar review of a remand order issued after a hearing on the validity of a forum-selection clause. In Regis Associates v. Rank Hotels (Management) Ltd., 894 F.2d 193 (6th Cir.1990), we agreed that a remand order is reviewable "when it is based on a substantive decision on the merits of...