Fraser v. James, Civil No. 1986/123

Decision Date09 March 1987
Docket NumberCivil No. 1986/123
Citation23 V.I. 155
PartiesCLARENCE FRASER, JEAN THELEMAQUE, ANTONIO RODRIGUEZ, and CHRISTIAN FARRELLY, Plaintiffs v. LONNIE JAMES, FREDERICK JOSEPH, GERALD JACKSON, RONALD DAVIS, NOEL EUBEZE, and the STEEL WORKERS OF AMERICA, LOCAL UNION NO. 8526, Defendants
CourtU.S. District Court — Virgin Islands

Defendants' motion for summary judgment, in action by union members against their union for discriminatorily denying strike funds due because of failure to picket during a lockout. The District Court, O'Brien, J., dismissed the complaint on grounds that the six-month statute of limitations embodied in the National Labor Regulations Act was applicable and the complaint was therefore time-barred.

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CORNELIUS EVANS, ESQ., St. Croix, V.I., for plaintiffs

JOHN R. COON, ESQ., St. Croix, V.I., for defendants

O'BRIEN, Judge

MEMORANDUM OPINION

The question we face today is whether the six-month statute of limitations embodied in § 10(b) of the National Labor Relations Act, 29 U.S.C. § 160(b) (1976), is applicable to a union member's action against his union for discriminatorily denying him strike funds due under the union's constitution. We hold that it is, and we dismiss the plaintiffs' complaint.

I. FACTS

This action arises out of the eleven-month lockout at the oil refinery of Hess Oil Virgin Islands Corporation ("HOVIC") which began in April 1984. The plaintiffs are or were undisputed members of the United Steelworkers of America ("Union"), Local No. 8526 ("local") who were embroiled in the lockout.

As we read the plaintiffs' complaint, the gravamen of their actions is their allegation that the local's representatives discriminatorily denied them strike funds because the plaintiffs refused to picket during the lockout.1. Complaint, Count II, ¶ 4. This, the plaintiffs assert, resulted in the breach of the union's duty to fairly represent them, Complaint, Count III, and a violation of the international's constitution amounting to a debt due. Complaint, Count I, ¶14. The plaintiffs bring this action, without pleading a jurisdictional basis for their claim,2 against the local and the individual defendants.

In this renewed motion for summary judgment,3 the defendants contend that the plaintiffs' claims are preempted by the federal labor statutes, and are either barred by the applicable statute of limitations, or fail to state a cognizable claim.4 We agree.5

II. DISCUSSION

[1-4] Section 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185(a) (1976), provides federal jurisdiction for suits involving labor contracts.6 Union constitutions are considered "contracts" for purposes of § 301 jurisdiction. United Asso. of Journeymen & Apprentices of the Plumbing & Pipefitting Industry v. Local 334, (Plumbing & Pipefitting), 452 U.S. 615, 619-22 (1981). Thus, federal jurisdiction extends to suits against unions by its members for breach of the union's constitution. Plumbing & Pipefitting, supra (local versus international), Local U. No. 1075, supra at 184; Papianni v. Intern. Ass'n of B.S. & O.I. Workers, 622 F. Supp. 1559 (D.C.N.J. 1985). Indeed, suits raising contract claims in the labor context are preempted by § 301 jurisdiction. AllisChalmers Corp. v. Lubeck, 471 U.S. 202, 105 S.Ct. 1904, 1910-11 (1985).

[5, 6] Section 301 also provides federal jurisdiction for suits by employees against their union for unfair or discriminatory treatment. Vaca v. Sipes, 386 U.S. 171, 177 (1967); Findley v. Jones Motor Freight, Etc., 639 F.2d 953, 957 (3d Cir. 1981); Lewis v. Local U. No. 100 of Laborers' Intern. U., 750 F.2d 1368, 1374 (7th Cir. 1984). Such claims are governed exclusively by federal law even when filed in state court. Peterson v. Airline Pilots Ass'n Intern., 759 F.2d 1161, 1170 (4th Cir. 1985), cert. denied, 474 U.S. 946, 106 S.Ct. 312 (1986).

[7, 8] This duty of fair representation arises, however, from the union's exlusive right to represent all bargaining unit members in their dealing with the employer;7 Lewis, supra at 1376; see also Deboles v. Trans World Airlines, Inc., 552 F.2d 1005, 1014 (3d Cir. 1977) cert. denied, 434 U.S. 837 (1977), and does not come into play "regarding conduct which affects only an individual's relationship within the union structure." Smith v. Babcock & Wilcox Co. Refractories Div., 726 F.2d 1562, 1566 (11th Cir. 1984) (citations omitted). For example, it has been held that the union's duty of fair representation does not extend to its eligibility rules for strike benefits. Kolinski, supra at 481-82.

[9] Since the plaintiffs' fair representation/discriminations claims fall within this exclusion, Counts II and III of their complaint must be dismissed.

[10] In addition, § 301 does not provide for actions against individual defendants. Complete Auto Transit, Inc. v. Reis, 451 U.S. 401 (1981). Such suits, as the defendants' counsel conceded at oral argument, would seem to arise under the provision of § 501 of the LMRDA, 29 U.S.C. § 501 (1985). That section provides for suits by members brought on behalf of their union against union officials who have violated certain fiduciary obligations imposed by the act.8United States v. Boffa, 688 F.2d 919, 930-31 (3d Cir. 1982), cert. denied, 465 U.S. 1066, (1983).

[11] In fact, § 501 has been applied to suits alleging the wrongful handling of strike funds. Erkins v. Bryan, 663 F.2d 1048 (11th Cir. 1981), reversing, 494 F. Supp. 732 (N.D. Ala. 1980), cert. denied, 459 U.S. 989 (1982); Agola v. Hagner, 556 F. Supp. 296, 299-300 (E.D.N.Y. 1982) (citing United States v. Robinson, 512 F.2d 491, 495 n.7 (2d Cir. 1975), cert. denied, 423 U.S. 853 (1975)). It cannot, however, be a basis for suits against the labor organization itself.9. Sabolsky v. Budzanoski, 457 F.2d 1245, 1249 (3d Cir.), cert. denied, 409 U.S. 853 (1972). Thus, our task here is to decide whether the plaintiffs' remaining § 501 claims against the individual union representatives, and their § 301 claim against the local are viable under these facts. We find that they are not.

A. Section 501

Although § 501(a) creates the fiduciary duties union officers owe their union, § 501(b) establishes conditions precedent for suits brought by members alleging breach of those duties.10 A plaintiff must first unsuccessfully demand that the union or its governing board or officers bring the action, Purcell v. Keane, 406 F.2d 1195 (3d Cir. 1969), unless such a request would be futile. Sabolsky, 457F.2d at 1252-53. Second, a plaintiff must secure court permission to institute the suit by filing a verified application with the court showing good cause. Third, the "[p]laintiff must be seeking relief on behalf of the union rather than on his own behalf . . . ." Reed v. United Trans Union, 633 F. Supp. 1516, 1522 (W.D.N.C. 1986) (citing Phillips v. Osborne, 403 F.2d 826, 828 (9th Cir. 1968); see also Agola, 556 F. Supp. at 300.11

[12] In the instant action, the plaintiffs did not seek leave of court prior to the institution of this suit, nor did they make a demand on the union officials. The first flaw is not fatal, however, where the plaintiffs did file a verified complaint and the allegations contained within are sufficient to determine whether there is good cause. Sabolsky, supra at 1250. Since the plaintiff's have filed a verified complaint, we will not rest the resolution to this issue on these grounds.

[13] The second flaw is also not fatal where as here a demand would be futile. It is uncontroverted that the policy of denying nonpicketers strike funds was handed down by the union to be enforced by the local's representatives. See plaintiffs' exhibit 6, affidavit of Clarence Fraser. Thus, we decline to dismiss this action based on this requirement.

[14] A third flaw is fatal, however, because this suit is clearly for the benefit of the plaintiffs themselves, rather than the union. Any monies owed to the plaintiffs are alleged as a debt due to them individually. Complaint, Count I. Moreover, such monies, ifrecovered, would directly proceed to the plaintiffs' account. Thus, we agree with the reasoning of Judge Mishler in Agola, who, facing a similar question wrote:

[I]n the case before us, plaintiffs' claim for wrongfully withheld strike benefit payments is essentially a jointly-made request for the recovery of individual claims. It is clear that if plaintiffs were able to bring this claim on behalf of a labor organization, as required by § 501(b), any recovery by such union would be only for the purpose of distributing the individual awards. The labor organization would serve as a mere filter, rather than as a participant in the recovery. Any benefit to the union would be non-monetary, e.g., the enforcement of the union's commitments to new members. We conclude that plaintiffs' suit is brought for the benefit of individual plaintiffs and not for the benefit of a labor organization.

556 F. Supp. at 301.

Because the plaintiffs have brought their suit for their own benefit, they have not satisfied the requirement of § 501(b), and their claims against the individual defendants will be dismissed.12 See e.g., Reed, 633 F. Supp. at 1528. We now turn to the plaintiffs' remaining § 301 claim against the union.

B. Section 301

[15] The defendants argue that any § 301 claim for breach of the union's constitution is time barred. Section 301, however, has no applicable statute of limitations within its provisions. Delcostello v. International Brotherhood of Teamsters, 462 U.S. 151, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983). Generally, the Supreme Court has concluded that analogous state statutes of limitations should be applied except where such state statutes of limitations are unsatisfactory vehicles for the enforcement of federal law. Id. at 158-161.

[16] One such situation where the Court has held state statute of limitations inapplicable are in the so called hybrid actions involving an employee's suit against the employer for breach of...

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