Daniels v. Burlington Northern R. Co.
| Decision Date | 19 October 1990 |
| Docket Number | No. 89-35654,89-35654 |
| Citation | 916 F.2d 568 |
| Parties | 135 L.R.R.M. (BNA) 2823, 116 Lab.Cas. P 10,370, 5 Indiv.Empl.Rts.Cas. 1852 Mark S. DANIELS, Plaintiff-Appellant, v. BURLINGTON NORTHERN RAILROAD COMPANY, a Delaware Corporation, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Alexander (Zander) Blewett, III, Hoyt & Blewett, Great Falls, Mont., for plaintiff-appellant.
Robert J. Sullivan, Boone, Karlberg & Haddon, Missoula, Mont., for defendant-appellee.
Appeal from the United States District Court for the District of Montana.
Before HUG, NELSON and BRUNETTI, Circuit Judges.
Plaintiff-appellant Mark S. Daniels ("Daniels") was employed by defendant-appellee Burlington Northern Railroad Company ("Burlington Northern"). On November 19, 1987, Burlington Northern terminated Daniels's employment. Daniels filed an action against Burlington Northern in federal court for constructive fraud and breach of the covenant of good faith arising from his termination. The district court dismissed Daniels's action for lack of subject matter jurisdiction, holding that Daniels had failed to exhaust his administrative remedies under the RLA. The district court subsequently denied Daniels's motion for reconsideration. We reverse the denial of the motion for reconsideration and remand for proceedings consistent with this opinion.
Daniels was employed by Burlington Northern. On November 19, 1987, Burlington Northern terminated his employment. At the time he was terminated, Daniels was a trainmaster at Burlington Northern's Laurel, Montana yard. As a terminal trainmaster, Daniels supervised yardmasters, switch crews, dispatchers, and numerous other Burlington Northern employees. Daniels contends on appeal that he had the authority to hire and dismiss employees. Burlington Northern contends that Daniels had no authority to hire or dismiss employees. Both parties agree that Daniels was not a member of an employee's union, and was not covered by any collective bargaining agreement.
On December 30, 1987, Daniels filed an action against Burlington Northern in federal court for constructive fraud and breach of the duty of good faith and fair dealing arising from his termination. Burlington Northern moved for summary judgment on the grounds that Daniels's claims were preempted by the Railway Labor Act, 45 U.S.C. Sec. 151 et seq. ("RLA"), or, alternatively, by the Montana Wrongful Discharge from Employment Act, Mont.Code Ann. Sec. 39-2-913 et seq. Daniels opposed summary judgment on the ground that his status as a nonunion, management-level employee not covered by a collective bargaining agreement placed him outside the scope of the RLA as a matter of law. In addition, Daniels argued that it would be futile for him to pursue administrative proceedings. However, he did not raise any factual issues, agreeing that "the relevant facts are not in dispute." Daniels also argued that the Montana Wrongful Discharge Act had been found unconstitutional, with a final decision by the Montana Supreme Court pending.
On January 23, 1989, the district court dismissed the action on the ground that it lacked subject matter jurisdiction, noting that "[i]t is undisputed" that Daniels was an "employee" as defined by the RLA and that the RLA "specifically encompasses 'subordinate officials' such as [Daniels]." The court also held that the RLA applied to nonunion employees and that Daniels was required to exhaust his remedies under the RLA before seeking relief in federal court. The court did not address Burlington Northern's alternative argument based on the Montana Wrongful Discharge from Employment Act.
Daniels then moved the district court to reconsider its decision pursuant to Federal Rule of Civil Procedure 59. Daniels argued that, in his capacity as a terminal trainmaster, he was not an "employee" under the RLA, and asserted that the district court had incorrectly concluded that there was no dispute regarding this issue. He provided the court with an affidavit stating:
I was a trainmaster. I was an exempt employee and supervised the entire Laurel terminal. In this regard, I supervised yardmasters, switch crews, dispatchers and other numerous Burlington Northern Railroad Company employees.
Under no circumstances was I ever considered a subordinate official under the Railway Labor Act.
At the Rule 59 hearing, Burlington Northern produced an affidavit of William R. Grimstad stating that trainmasters "do not have the authority to employ or dismiss employees of Burlington Northern Railroad that they supervise." Daniels submitted an Employment Manual of Burlington Northern, dated September 1, 1977, indicating that trainmasters, such as Daniels, may have the authority to hire employees. Daniels also submitted a Burlington Northern Management Appraisal of him rating, among other things, his job knowledge as in compliance with all federal, state, and local EEO and affirmative action regulations. Daniels also moved to supplement the record with the deposition of William Grimstad, a Division Superintendent for Burlington Northern, and Burlington Northern's Offer to Arbitrate. In his deposition, Grimstad stated that the duties of a terminal trainmaster include "Getting the people, ... and supervising the people to get the trains made up, cars in the proper trains, and moving efficiently." Exhibit 2 to the Grimstad Deposition defines the functions of a Terminal Trainmaster to include holding investigations, reviewing, and recommending discipline of employees.
On August 28, 1989, the district court denied Daniels's motion for reconsideration. The court also ordered that Daniels be allowed to file the Grimstad deposition and Burlington Northern's Offer to Arbitrate.
On September 6, 1989, Daniels filed his notice of appeal from the final judgment entered on January 23, 1989, and from the order, entered on August 28, 1989, denying his motion for reconsideration of that judgment.
On appeal, Daniels contends that his claims are not subject to the exclusive jurisdiction of the Board for three reasons. First, Daniels argues that he was not an "employee" under the RLA because he was a management level terminal trainmaster. Second, Daniels argues that his claims do not constitute a "grievance" under the RLA because the RLA applies only to the disputes relating to collective bargaining agreements. Third, Daniels argues that the RLA does not apply to nonunion employees who are not subject to collective bargaining agreements.
We review the district court's grant of summary judgment de novo. Kruso v. International Telephone & Telegraph Corp., 872 F.2d 1416, 1421 (9th Cir.1989). We review the district court's decision concerning a motion for a new trial pursuant to Fed.R.Civ.P. 59 for an abuse of discretion. Hard v. Burlington Northern R.R., 812 F.2d 482, 483 (9th Cir.1987).
Under the RLA, if a claim is classified as a "minor dispute," the claim is subject to compulsory and binding arbitration before the National Railroad Adjustment Board or before an adjustment board established by the employer and the unions representing the employees (collectively, the "Board"). Consol. Rail Corp. v. Railway Labor Exec. Ass'n, --- U.S. ----, 109 S.Ct. 2477, 2480, 105 L.Ed.2d 250 (1989) ("Conrail "). When a claim constitutes a "minor dispute," state law is preempted and the exclusive remedy lies under the RLA. Magnuson v. Burlington Northern, Inc., 576 F.2d 1367 (9th Cir.1978), cert. denied, 439 U.S. 930, 99 S.Ct. 318, 58 L.Ed.2d 323 (1978). The district court has no original jurisdiction over such claims; the claims are within the exclusive jurisdiction of the Board. Conrail, 109 S.Ct. at 2481.
A "minor dispute" subject to the exclusive jurisdiction of the Board includes "[a]ll disputes between a carrier or carriers and its or their employees, arising out of grievances or out of the interpretation or application of agreements concerning the rates of pay, rules, or working conditions." 45 U.S.C. Sec. 152 Second (emphasis added); Conrail, 109 S.Ct. at 2480. An "employee" is "every person in the service of a carrier (subject to its continuing authority to supervise and direct the manner of rendition of his service) who performs any work defined as that of an employee or subordinate official in the Orders of the Interstate Commerce Commission." 45 U.S.C. Sec. 151 Fifth (emphasis added). Thus, the status of any person in the service of a carrier is determined by the character of his work and the applicable orders of the I.C.C. See Brotherhood of L.F. & E. v....
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