Creamer v. General Teamsters Local Union 326

• Decision Date: 06 January 1984
• Docket Number: Civ. A. No. 81-515-WKS.
• Parties: Stephen M. CREAMER and Spud M. Burns, Plaintiffs, v. GENERAL TEAMSTERS LOCAL UNION 326, and Inland Container Corporation, a Delaware corporation, Defendants.
• Court: U.S. District Court — District of Delaware

579 F. Supp. 1284

Stephen M. CREAMER and Spud M. Burns, Plaintiffs, v. GENERAL TEAMSTERS LOCAL UNION 326, and Inland Container Corporation, a Delaware corporation, Defendants.

Civ. A. No. 81-515-WKS.

United States District Court, D. Delaware.

January 6, 1984.

COPYRIGHT MATERIAL OMITTED

Kenneth M. Roseman, D'Angelo, Ciconte & Roseman, Wilmington, Del., for plaintiffs.

Thomas L. Little, Wilmington, Del., for defendant Local 326.

Edward P. Welch, Stephen P. Lamb, Skadden, Arps, Slate, Meagher & Flom, Wilmington, Del., Edward O. DeLaney, David L. Swider, Barnes & Thornburg, Indianapolis, Ind., for defendant Inland.

OPINION

STAPLETON, Chief Judge:

The defendants, Inland Container Corporation ("Inland") and General Teamsters Local Union 326 ("Local 326") have moved for reconsideration of this Court's March 23, 1983 opinion, reported at 560 F.Supp. 495, denying Inland's Motion for Summary Judgment. The Court held that a material issue of fact existed as to whether fraudulent concealment by the defendants tolled the statute of limitations. Since the alleged acts of fraudulent concealment occurred before the expiration of even the shortest limitations period cited by the parties, it was unnecessary for the Court to decide which statute of limitations applies to the claims in this suit. Defendants now argue that the recent Supreme Court decision in Del Costello v. International Brotherhood of Teamsters, et al., ___ U.S. ___, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983) sets forth the statute of limitations applicable to all of the plaintiffs' claims. If the six-month statute of limitations of Del Costello is applicable to all claims in this case, then, say the defendants, the suit must be dismissed as the alleged acts of concealment occurred after the statute of limitations had already run.

Defendants argue that Del Costello adopts a six-month statute of limitations for all suits brought under section 301 of the Labor Management Relations Act, 29 U.S.C. § 185, and that, under Wilkes-Barre Pub. v. Newspaper Guild, Etc., 647 F.2d 372 (3d Cir.1981), all state causes of action that will require the court to construe and enforce the provisions of a collective bargaining agreement are preempted and absorbed, where appropriate, as part of the federal common law developed under section 301. Defendants further argue that the Del Costello rationale requires that the six-month statute of limitations be applied as well to the plaintiffs' claims under the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. §§ 1961 et seq.

The issue facing the Court in this case is the familiar one of what statute of limitations to apply where Congress has enacted federal legislation but failed to provide a limitations period as an integral part of such legislation. This is only one example of the interstitial federal lawmaking that the courts are required to engage in because of the inevitable incompleteness of legislation. It is presumed that Congress did not intend that there be no time limit on bringing such suits, and, as a general rule, the federal courts "borrow" the most analogous state statute. However, the federal courts are not required to mechanically apply state statutes of limitations where resort to state law would "frustrate or interfere with the implementation of national policies." Del Costello, ___ U.S. at ___, 103 S.Ct. at 2289, quoting Occidental Life Insurance Co. v. EEOC, 432 U.S. 355, 367, 97 S.Ct. 2447, 2455, 53 L.Ed.2d 402 (1977).

In Auto Workers v. Hoosier Corp., 383 U.S. 696, 86 S.Ct. 1107, 16 L.Ed.2d 192 (1966), the Supreme Court held that the general rule of resort to state law is not inapplicable in the labor-management relations context despite the need for uniformity in the field of federal labor law. Hoosier involved a suit brought by the union against the employer for breach of a collective bargaining agreement. In finding the suit governed by the state limitations period for actions on an unwritten contract, the Court likened this variety of section 301 suit to an ordinary breach of contract action. The Court explicitly declined, however, to consider whether other kinds of section 301 suits might not call for a uniform federal limitations period. Id. at 705, n. 7, 86 S.Ct. at 1113, n. 7. The Court concluded that the federal labor policies underlying this type of section 301 suit did not require departure from the general rule: "The need for uniformity, then, is greatest where its absence would threaten the smooth functioning of those consensual processes that federal labor law is chiefly designed to promote—the formation of the collective bargaining agreement and the private settlement of disputes under it. For the most part, statutes of limitations come into play only when these processes have already broken down. Lack of uniformity in this area is therefore unlikely to frustrate in any important way the achievement of any significant goal of labor policy." Id. at 702, 86 S.Ct. at 1111.

Del Costello does not alter the Court's holding in Hoosier. Rather, it considers the statute of limitations issue in the area left open in Hoosier, the area where there is the greatest danger that private dispute resolution under labor contracts will be disrupted. In particular, Del Costello applies to the so-called Vaca-Hines suit, a hybrid action involving two claims: a section 301 claim against the employer for breach of the collective bargaining agreement, and a suit against the union for breach of the duty of fair representation. See Vaca v. Sipes, 386 U.S. 171, 87 S.Ct. 903, 17 L.Ed.2d 842 (1967); Hines v. Anchor Motor Freight, 424 U.S. 554, 96 S.Ct. 1048, 47 L.Ed.2d 231 (1976). The Supreme Court has characterized these suits as constituting a "direct challenge to the private settlement of disputes under the collective bargaining agreement." Del Costello, ___ U.S. at ___, 103 S.Ct. at 2291. The Court noted that this type of lawsuit has no close state law counterpart, but that it bears a strong family resemblance to claims of unfair labor practices brought before the National Labor Relations Board. The Court then concluded that state limitations periods were either too short or too long to adequately protect the interests of the employees and yet ensure the proper functioning of the various grievance and arbitration mechanisms so vital to the prompt and efficient resolution of labor disputes. By contrast, section 10(b) of the National Labor Relations Act, which sets a six-month period for filing charges of unfair labor practices before the NLRB, was designed with precisely these competing interests in mind. The Court determined, therefore, that hybrid section 301/fair representation suits are governed by a six-month statute of limitations.

Although the pleadings in this case are duplicative and far from explicit as to the causes of action being alleged, the Court understands plaintiffs' amended complaint to state the following five claims:

1) Breach by Local 326 of its duty of fair representation/breach by Inland of the collective bargaining agreement (under the theory that Inland is a co-employer).

2) Intentional interference by Inland with the performance by Local 326 and Universal Coordinators of their business obligations to plaintiffs.

3) Breach of fiduciary duty by Local 326.

4) Civil conspiracy to deprive plaintiffs of contractual rights.

5) Racketeering under 18 U.S.C. § 1961.

The first claim falls squarely within that type of hybrid section 301/fair representation suit described in Vaca and Hines. Under Del Costello, this claim is governed by the six-month statute of limitations of section 10(b) of the NLRA, and the parties are in agreement as to this issue. Similarly, the parties agree that under Wilkes-Barre, the charges of intentional interference with business obligations and breach of fiduciary duty do not have any independent existence as state law claims. Whether these allegations state a claim upon which relief can be granted is a matter of the federal common law of labor contracts under section 301. Although not every claim brought under section 301 is automatically governed by a six-month statute of limitations, these claims arise in the context of a Vaca-Hines suit and focus on the collective bargaining agreement. I hold, therefore, that these claims are likewise subject to a six-month limitations period.

The fourth claim charges defendants with participation in a civil conspiracy to deprive plaintiffs of their rights under the collective bargaining agreement. Plaintiffs argue that state civil conspiracy claims are an exception to the preemption rule because states have a deep and compelling interest in dealing with such matters. It is apparent, however, that merely tacking an allegation of conspiracy to any set of facts does not magically invest the claim with a compelling state interest. If that were the case, the doctrine of federal preemption of labor law would be virtually wiped out, considering the ease of appending a charge of conspiracy to any fact pattern. Abrams v. Carrier Corp., 434 F.2d 1234, 1253 (2d Cir.1970), does not indicate that state conspiracy claims in the labor field are not preempted because of some overwhelming state interest. To the contrary, the Court held that the conspiracy claim there asserted was preempted by federal law. In any event, the Wilkes-Barre case strongly suggests that plaintiffs' civil conspiracy claim, based as it is upon the collective bargaining agreement, states a claim, if at all, within section 301. Since it arises in the context of a Vaca-Hines suit and involves the same facts, it is governed by the six-month statute of limitations adopted in Del Costello.

The final claim alleges violations of the RICO statute. RICO creates a new federal cause of action independent of the "predicate acts" that make up the "pattern of racketeering activity." 18 U.S.C. § 1961(5). The defendants argue that under the rationale of Del Costello we...