Cephas v. Mvm, Inc., 06-5244.

• Decision Date: 28 March 2008
• Docket Number: No. 06-5244.,06-5244.
• Citation: 520 F.3d 480
• Parties: James W. CEPHAS, Appellant v. MVM, INC. and Robert L. Chaney, Department of Justice, United States Attorney's Office, Appellees.
• Court: U.S. Court of Appeals — District of Columbia Circuit

520 F.3d 480

James W. CEPHAS, Appellant v. MVM, INC. and Robert L. Chaney, Department of Justice, United States Attorney's Office, Appellees.

No. 06-5244.

United States Court of Appeals, District of Columbia Circuit.

Argued February 4, 2008.

Decided March 28, 2008.

Appeal from the United States District Court for the District of Columbia (No. 05cv00033).

Richard J. Link, Jr. argued the cause and filed the brief for appellant.

Katherine A. Goetzl argued the cause for appellee MVM, Inc. With her on the brief was Jason M. Branciforte.

Before: GINSBURG, GRIFFITH, and KAVANAUGH, Circuit Judges.

Opinion for the Court filed by Circuit Judge GINSBURG.

GINSBURG, Circuit Judge:

James Cephas sued his employer, MVM, Inc., for damages, claiming the company violated its Collective Bargaining Agreement (CBA) with Cephas's union when it transferred him to another position. The district court first held Cephas's claim arose under § 301 of the Labor Management Relations Act, 29 U.S.C. § 185, because § 301 completely preempts a claim for breach of a CBA cast in terms of state contract law. The court then held the applicable statute of limitations was to be found in § 10(b) of the National Labor Relations Act, 29 U.S.C. § 160(b) (six months), and dismissed the action as untimely. We hold the applicable limitation period was to be found in the District of Columbia Code, § 12-301(7) (three years) pursuant to which this case was timely filed.

I. Background

At all relevant times MVM provided security guards for various premises in Washington, D.C. under a contract with the U.S. Marshals Service. Cephas was employed by MVM as a Court Security Officer at the U.S. Attorney's Office in March 2003 when Robert Chaney, the government official in charge of security there, alleged Cephas failed to respond to an emergency while on duty and invoked the Government's contractual right to have Cephas removed. As a result, MVM transferred Cephas to its security force at the National Courts Building.

Cephas's union filed a grievance with MVM, claiming the transfer was inconsistent with its CBA. MVM denied the grievance on the ground that the transfer of Cephas was "not reviewable" under the CBA because it "was done at the written request of the Government."

In December 2004, Cephas sued Chaney and MVM in the Superior Court of the District of Columbia, alleging Chaney had defamed him and MVM had transferred him in violation of the CBA and unspecified "rights of Cephas." MVM removed the case to the United States district court, which dismissed the suit against MVM in September 2005. The court reasoned that § 301 of the LMRA completely preempted Cephas's claim under D.C. law and that, recast as a federal claim arising under § 301, it was barred by the six-month statute of limitations in § 10(b) of the NLRA. 403 F.Supp.2d 17; see Caterpillar Inc. v. Williams, 482 U.S. 386, 393, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987) ("Once an area of state law has been completely pre-empted, any claim purportedly based on that pre-empted state law is considered, from its inception, a federal claim, and therefore arises under federal law"). In July 2006, the district court dismissed Cephas's action against Chaney as barred by the doctrine of sovereign immunity or, in the alternative, as untimely.

Cephas appealed both rulings. Another panel of this court affirmed the dismissal of the action against Chaney; we address now only the timeliness of Cephas's claims against MVM.

II. Analysis

Cephas argues his contract claim arises under D.C. law, i.e., is not completely preempted, and that, even if the claim is completely preempted and therefore arises under § 301, D.C. law provides the applicable statute of limitations. MVM takes the position that § 301 completely preempts Cephas's state law claim and that the applicable statute of limitations is to be found in § 10(b) of the NLRA. Reviewing these issues of law de novo, we hold that Cephas's claim arises under § 301 but nonetheless was timely filed because, for the type of claim advanced in this case, § 301 borrows the District of Columbia's limitation period for a breach of contract action, which is three years.

A. Complete Preemption

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 ... may be brought in any district court ... without respect to the amount in controversy [and] without regard to the citizenship of the parties.

The Supreme Court has held § 301(a) is a source of substantive federal common law, Textile Workers Union v. Lincoln Mills of Ala., 353 U.S. 448, 456-57, 77 S.Ct. 912, 1 L.Ed.2d 972 (1957), and provides a federal right of action, see Avco Corp. v. Aero Lodge No. 735, 390 U.S. 557, 88 S.Ct. 1235, 20 L.Ed.2d 126 (1968). Moreover, an employee may sue his employer under § 301 for breach of a CBA even if the employer's alleged conduct is also an unfair labor practice prohibited by the NLRA. See Smith v. Evening News Ass'n, 371 U.S. 195, 197, 201, 83 S.Ct. 267, 9 L.Ed.2d 246 (1962).

Section 301 completely preempts any action predicated upon state law if that action "depends upon the meaning of a collective-bargaining agreement." Lingle v. Norge Div. of Magic Chef Inc., 486 U.S. 399, 405-06, 108 S.Ct. 1877, 100 L.Ed.2d 410 (1988). As the Supreme Court has explained,

the pre-emptive 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." Any such suit is purely a creature of federal law, notwithstanding the fact that state law would provide a cause of action in the absence of § 301.

Franchise Tax Bd. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 23, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983) (citing Avco Corp., 390 U.S. 557, 88 S.Ct. 1235, 20 L.Ed.2d 126).

Cephas's complaint charges MVM breached the CBA and violated unspecified "rights" of his. Neither his complaint nor his brief, however, identifies any source of right — such as an individual employment agreement — other than the CBA. We conclude his action depends entirely upon the meaning of the CBA and is, therefore, completely preempted by § 301. Lingle, 486 U.S. at 405-06, 108 S.Ct. 1877; cf. Caterpillar Inc., 482 U.S. at 394-95, 107 S.Ct. 2425 (Section 301 does not completely preempt action for breach of individual employment contract).

B. Timeliness

Although Cephas's only cause of action arises under a federal statute, that is, § 301, federal law does not necessarily displace the statute of limitations that would apply under D.C. law. Section 301 does not specify a statute of limitations,^* and "the general rule [is] that statutes of limitation" for federal rights of action that do not specify a limitation period "are to be borrowed from state law." Reed v. United Transp. Union, 488 U.S. 319, 324, 109 S.Ct. 621, 102 L.Ed.2d 665 (1989); see also Holmberg v. Armbrecht, 327 U.S. 392, 395, 66 S.Ct. 582, 90 L.Ed. 743 (1946) ("As to actions at law, the silence of Congress has been interpreted to mean that it is federal policy to adopt the local law of limitation"). We presumptively apply the limitation period that would apply to the state law claim that is "most closely analogous" to the federal claim in suit. North Star Steel Co. v. Thomas, 515 U.S. 29, 34, 115 S.Ct. 1927, 132 L.Ed.2d 27 (1995); see also Graham County Soil & Water Conservation Dist. v. United States ex rel. Wilson, 545 U.S. 409, 414-15, 125 S.Ct. 2444, 162 L.Ed.2d 390 (2005) ("we ... `borrow' the most closely analogous state limitations period" in all but "the rare case").

The presumption favoring state law is overcome only "when the state limitations period ... would frustrate or interfere with the implementation of national policies or be at odds with the purpose or operation of federal substantive law." North Star Steel, 515 U.S. at 34-35, 115 S.Ct. 1927 (citations and quotations omitted). In that event, the courts must borrow a limitation period from an analogous federal statute. Id.; see also RICHARD H. FALLON, JR. ET AL., HART & WECHSLER'S THE FEDERAL COURTS AND THE FEDERAL SYSTEM 761-62 (5th ed.2003) (discussing cases in which the Supreme Court has "fashion[ed] a federal rule of decision" by borrowing from a federal statute).

Cephas argues federal law does not displace the state (here, D.C.) statute of limitations for a breach of contract action, wherefore his case was timely filed. MVM counters, on the authority of DelCostello v. International Brotherhood of Teamsters, 462 U.S. 151, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983), that the six-month statute of limitations in § 10(b) of the NLRA displaces the presumptively applicable state limitation period whenever an employee sues his employer for breach of a CBA.

(1) DelCostello and the Hybrid Claim

Before DelCostello, the Supreme Court had held in a § 301 suit for breach of a CBA that the applicable statute of limitations was to be borrowed from analogous state law. Thus, in UAW v. Hoosier Cardinal Corp., a § 301 action for damages brought by a union alleging the employer had breached the CBA and various unwritten contracts of employment with the employees, the Court applied the state statute of limitations for breach of contract. 383 U.S. 696, 86 S.Ct. 1107, 16 L.Ed.2d 192 (1966). In DelCostello, however, the Court addressed a different sort of claim and reached a different result.

Although an employee may sue an employer under § 301 for breach of a CBA, the employee first must exhaust the grievance and arbitration procedures in the CBA. Republic Steel Corp. v. Maddox, 379 U.S. 650, 652-53, 85 S.Ct. 614, 13 L.Ed.2d 580 (1965). If, however, "the union representing the employee in the grievance/arbitration procedure acts in such a discriminatory, dishonest, arbitrary, or perfunctory fashion as to breach its duty of fair representation" (DFR), then the "employee may bring suit against both the...