Beriault v. Local 40, Super Cargoes and Checkers of Intern. Longshoremen's and Warehousemen's Union

• Decision Date: 25 July 1974
• Docket Number: No. 72-2118,72-2118
• Citation: 501 F.2d 258
• Parties: 87 L.R.R.M. (BNA) 2070, 74 Lab.Cas. P 10,247 Donn L. BERIAULT et al., Plaintiffs-Appellants, v. LOCAL 40, SUPER CARGOES & CHECKERS OF the INTERNATIONAL LONGSHOREMEN'S& WAREHOUSEMEN'S UNION et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 258

501 F.2d 258

87 L.R.R.M. (BNA) 2070, 74 Lab.Cas. P 10,247

Donn L. BERIAULT et al., Plaintiffs-Appellants, v. LOCAL 40, SUPER CARGOES & CHECKERS OF the INTERNATIONAL LONGSHOREMEN'S& WAREHOUSEMEN'S UNION et al Defendants-Appellees.

No. 72-2118.

United States Court of Appeals, Ninth Circuit.

July 25, 1974.

Sherman Kellar (argued), of Engel & Kellar, Portland, Or., for plaintiffs-appellants.

James H. Clarke (argued), of McColloch, Dezendorf, Spears & Lubersky, Portland, Or., Raymond J. Conboy (argued), of Pozzi, Wilson & Atchison, Portland, Or., for defendants-appellees.

OPINION

Before HAMLEY, WRIGHT and KILKENNY, Circuit Judges.

EUGENE A. WRIGHT, Circuit Judge:

This is a a labor dispute in which plaintiffs appeal from the dismissal of their action for declaratory, injunctive and monetary relief against defendants for breach of the union's duty of fair representation and breach of a collective bargaining agreement. ¹ Jurisdiction is based on 301 of the Labor Management Relations Act (LMRA), 29 U.S.C. 185, and the Declaratory Judgments Act, 28 U.S.C. 2201. We affirm in part, reverse in part, and remand.

Plaintiffs are 'casual checkers' who are non-union members of the employee bargaining unit represented by Local 40, Super Cargoes and Checkers of the International Longshoremen's and Warehousemen's Union (ILWU). They brought suit against the ILWU and the Pacific Maritime Association (PMA) charging, in substance, that (1) they have been discriminated against with respect to their job classification, and have thereby been denied fringe benefits available to union members under the terms of the collective bargaining agreement, and (2) the ILWU and the PMA acted in violation of the collective bargaining agreement in giving union members preference over the plaintiffs in work assignments. Plaintiffs assert that the ILWU has breached its duty of fair representation in the negotiation and enforcement of the collective bargaining agreement.

Following trial on the segregated issues of preemption and exhaustion of remedies, the district court dismissed the complaint for lack of jurisdiction, finding that the matter was within the exclusive jurisdiction of the National Labor Relations Board and, further, that plaintiffs failed to exhaust the grievance procedures provided in their contract.

The Supreme Court has recognized that Congress, by conferring upon the National Labor Relations Board the powers to interpret and enforce the Labor Management Relations Act, necessarily implied that potentially conflicting 'rules of law, of remedy, and of administration' cannot be permitted to operate. San Diego Building Trades Council v. Garmon, 359 U.S. 236, 242, 79 S.Ct. 773, 778, 3 L.Ed.2d 775 (1959). This recognition forms the basis for the doctrine of preemption in labor relations, which, as a general rule, provides that 'neither state nor federal courts have jurisdiction over suits directly involving 'activity (which) is arguably subject to 7 or 8 of the Act." Vaca v. Sipes, 386 U.S. 171, 179, 87 S.Ct. 903, 17 L.Ed.2d 842 (1967), quoting San Diego Building Trades Council v. Garmon, supra 359 U.S. at 245, 79 S.Ct. 773.

The preemption doctrine, despite its apparent clarity, has become best described only by reference to its exceptions. See Symposium, A Matter of Wooden Logic: Labor Law Preemption and Individual Rights, 51 Texas L.Rev. 1037, 1041 (1973). Included in the list of exceptions that permit courts to adjudicate certain cases is one for all suits brought under 301 for breach of the collective bargaining agreement (William E. Arnold Co. v. Carpenters, 417 U.S. 12, 94 S.Ct. 2069, 40 L.Ed.2d 620 (May 20, 1974); Smith v. Evening News Ass'n, 371 U.S. 195, 83 S.Ct. 267, 9 L.Ed.2d 246 (1962); see Sovern, Section 301 and the Primary Jurisdiction of the NLRB, 76 Harv.L.Rev. 529 (1963)), and one for at least some suits brought under the duty of fair representation. Vaca v. Sipes, supra.

In the present case, the district court found that although plaintiffs' contentions are couched in terms of breach of the collective bargaining agreement, 'their basic and underlying complaint is really directed to the terms of that agreement itself.' 340 F.Supp. at 156. The court appeared to conclude, therefore, that the 301 exception to preemption was inapplicable and that it lacked jurisdiction over the matter. The court concluded moreover that important questions of labor policy and federal concern pervaded the matters under submission, further warranting a deferral of jurisdiction to the Board. In addition, the court concluded that the defendant ILWU committed not act constituting a breach of its duty of fair representation. That exception to the preemption doctrine therefore remained inoperative.

We are of the opinion that these conclusions of the district court were erroneous and we remand for further consideration, but we affirm as to the need to exhaust grievance procedures.

I. BREACHES OF THE COLLECTIVE BARGAINING AGREEMENT

Section 301, 29 U.S.C. 185, confers jurisdiction on district courts in 'suits for violation of contracts between an employer and a labor organization representing employees . . ..' In Smith v. Evening News Ass'n, supra, the Supreme Court held that the Garmon preemption doctrine had no application to 301 suits. Later, in Humphrey v. Moore, 375 U.S. 335, 84 S.Ct. 363, 11 L.Ed.2d 370 (1964), the Court held that an individual employee could maintain a 301 action to enforce his rights under a collective bargaining agreement. See Amalgamated Ass'n of Street Employees v. Lockridge, 403 U.S. 274, 298, 91 S.Ct. 1909, 29 L.Ed.2d 473 (1971); Feller, A General Theory of the Collective Bargaining Agreement, 61 Calif.L.Rev. 663, 693-95 (1973).

We disagree with the district court here and conclude that plaintiffs actually claim breaches of the collective bargaining agreement and properly invoke federal court jurisdiction. True, 'it is the conduct being regulated, not (plaintiffs') formal description of governing legal standards, that is the proper focus of concern.' Amalgamated Ass'n of Street Employees v. Lockridge, supra at 292, 91 S.Ct. at 1920. And true, much of plaintiffs' complaint is clearly beyond the reach of 301, being concerned not with breaches of the collective bargaining agreement but with the substance of the agreement itself. Nevertheless, plaintiffs do make two specific allegations of breach of the contract.

Plaintiffs allege that the ILWU and the PMA entered into an agreement, supplemental to the contract, providing for dispatch of 'A' longshoremen from Locals 4 and 8 to checker jobs in preference to plaintiffs if there was insufficient longshore work to utilize all 'A' longshoremen, and that the agreement has been continually breached by dispatching such longshoremen to do checking work even when there was longshoring available. Plaintiffs claim additionally that the ILWU and the PMA have dispatched striking unionists to checker jobs in preference to plaintiffs, thereby violating the anti-discrimination clause (13.1) of the contract.

As to these contentions, therefore, federal jurisdiction exists under 301, and the district judge erred in applying the preemption doctrine. The judge proffered an alternative, valid rationale for dismissing plaintiffs' action, however, at least as to the breach-of-contract contentions: plaintiffs' failure to exhaust contractual remedies.

Plaintiffs concede that the contract provides a comprehensive grievance and arbitration procedure which they failed to utilize fully. Approximately three weeks before filing their complaint in district court, plaintiffs filed a statement of grievances pursuant to the contract. They failed, however, to present evidence to support them at a hearing before the Joint Port Labor Relations Committee. Plaintiffs were invited to return and present additional evidence at a later time but failed to do so. ² They argue that their failure to pursue contractual remedies should not work to their detriment because resort to the grievance procedures would have been futile. The district judge rejected this argument, finding it to be purely 'academic' since plaintiffs made no real effort to present and prosecute their grievance as provided in the contract.

As a general rule, employees must attempt to exhaust the grievance and arbitration procedures established by the bargaining agreement before seeking judicial enforcement of their rights. Vaca v. Sipes, supra 386 U.S. at 184-185, 87 S.Ct. 903; ³ Republic Steel Corp. v. Maddox, 379 U.S. 650, 85 S.Ct. 614, 13 L.Ed.2d 580 (1965). Under certain circumstances, however, an employee may obtain judicial review of his breach-of-contract claim despite his failure to pursue contractual remedies.

The Court noted two such circumstances in Vaca v. Sipes. First, an employee is not limited to contractual remedial procedures when the conduct of the employer amounts to a repudiation of them. 'In such a situation (and there may of course be others), the employer is estopped by his own conduct to rely on the unexhausted grievance and arbitration procedures as a defense to the employee's cause of action.' 386 U.S. at 185, 87 S.Ct. at 914. Secondly, an employee is excused from exhausting his contractual remedies if he was prevented from doing so by the union's wrongful refusal to process the grievance. Id.

Plaintiffs in the present case have made no showing of the existence of either of these situations. Nor have they proved any other set of facts tending to excuse their conceded failure to exhaust the contractual grievance and arbitration procedures. As to the two purely breach-of-contract claims, therefore, the district court correctly dismissed the action.

II DUTY OF FAIR REPRESENTATION

In Steele v. Louisville & N.R.R., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173 (1944), a case involving the Railway Labor Act, the Supreme Court first announced that a union has the statutory duty to represent fairly...