Grain Processing Corp. v. Culver
| Decision Date | 17 February 2010 |
| Docket Number | No. 3:10-cv-0008-JAJ.,3:10-cv-0008-JAJ. |
| Citation | 708 F.Supp.2d 859 |
| Parties | GRAIN PROCESSING CORPORATION, Plaintiff,v.Chester J. CULVER, Governor of the State of Iowa, Defendant. |
| Court | U.S. District Court — Southern District of Iowa |
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Howard L. Bernstein, Michael F. Hughes, William J. Tarnow, Neal Gerber & Eisenberg LLP, Chicago, IL, Iris E. Muchmore, Kevin J. Visser, Thomas D. Wolle, Simmons Perrine Moyer & Bergman PLC, Cedar Rapids, IA, for Plaintiff.
Julie F. Pottorff, Attorney General of Iowa, Des Moines, IA, for Defendant.
In an effort to resolve an ongoing labor dispute between Grain Processing Corporation and UFCW Local 86D, Governor Chester J. Culver initiated proceedings to appoint a board of arbitration and conciliation pursuant to authority granted in Chapter 679B of the Code of Iowa. Grain Processing Corporation (“GPC”) seeks to enjoin the Governor's action contending that such action is prohibited by federal law. GPC invokes the Supremacy Clause of the United States Constitution contending that the Governor's action is preempted by the National Labor Relations Act (“NLRA”). Because the Governor's action is clearly preempted by the NLRA, the court grants the relief requested by GPC.
On December 28, 2009, Wayne E. Shoultz, chair of the Muscatine County Board of Supervisors, wrote to Governor Culver indicating that 350 workers at GPC had been locked out when labor negotiations between the company and the union broke down in August 2009. The letter indicated that there has been no violence. However, due to the anxiety and uncertainty in the lives of workers, Supervisor Shoultz asked for assistance to end the lockout. He requested that the Governor exercise his authority pursuant to Chapter 679B of the Code of Iowa to appoint a board of arbitration and conciliation to conduct an investigation and make a decision to settle the dispute.
On January 14, 2010, Governor Culver wrote to Dan Olson of GPC and William Poggemiller and Lorraine Orr of the UFCW notifying them of his intent to appoint a board of arbitration and conciliation pursuant to Chapter 679B. The Governor directed each side to nominate members of the board. The Governor indicated that upon the board's appointment, it was to visit the place where the dispute exists and make careful inquiry. The board was to advise the parties what ought to be done to adjust the controversy and to make a written decision. Its decision was to contain findings of fact and recommendations as to how to end the controversy. The decision was to be made available for public inspection and published in two newspapers of general circulation in Muscatine County. The letter concluded as follows:
I am hopeful the appointment of this board of arbitration and conciliation will bring this dispute to a close and allow UFCW members to resume work at GPC under amicable terms.
GPC commenced this action on January 22, 2010. In the complaint, it seeks a declaratory judgment that the proposed action pursuant to Chapter 679B is preempted by the NLRA by operation of the Supremacy Clause of the United States Constitution. GPC further requests permanent injunctive relief prohibiting the Governor from invoking the processes and procedures of Chapter 679B.
Upon receipt of the plaintiff's application for preliminary injunction, the court contacted the parties to determine the process for resolving the complaint. During a status conference, the parties preliminarily indicated that there were no factual disputes to be resolved and that the matter could be resolved by the court without need for an evidentiary hearing. The parties confirmed the agreement during a hearing on the merits held February 12, 2010, in Davenport, Iowa. Specifically, both parties agreed that the factual matters for the court to rely upon could be found in those portions of the complaint that were admitted by the Governor, Supervisor Wayne E. Shoultz's letter of December 28, 2009, and the Governor's January 14, 2010, letter. The parties requested that the court resolve plaintiff's request for permanent injunctive and declaratory relief and enter judgment on the merits.
The parties agree that plaintiff GPC is an Iowa corporation with its principal place of business in Muscatine, Iowa, and that it is engaged in interstate trade relations. They further agree that the Governor is sued in his official capacity as Governor. The court has subject matter jurisdiction over this dispute pursuant to 28 U.S.C. §§ 1331 and 1337(a) and venue is appropriate in this court pursuant to 28 U.S.C. § 1391(b)(2).
GPC is an Iowa corporation with its principal place of business in Muscatine, Iowa. It annually contracts with, sells and transports products directly to customers located outside the State of Iowa, producing annual gross revenue in excess of $50,000. As such, it is subject to the jurisdiction of the National Labor Relations Board.
GPC has been involved in a labor dispute with the United Food and Commercial Workers Union, Local 86D for approximately seventeen months. On January 19, 2010, GPC received the certified letter from Governor Culver, a copy of which is attached as Exhibit A. As noted above, the letter indicated the Governor's intention to invoke Iowa Code Chapter 679B to appoint a board of arbitration and conciliation to resolve the ongoing labor dispute between GPC and UFCW, Local 86D.
The parties present two issues for resolution. First, GPC contends that Chapter 679B does not apply to it. Second, it contends that the Governor does not have authority to invoke this chapter under these circumstances because such action is preempted by the NLRA. The first issue does not need to be resolved because of the resolution of the second issue.
The Governor contends that Chapter 679B applies to this dispute, that only one or two provisions of Chapter 679B are preempted and that he is entitled to take action pursuant to the local interest exception to NLRA preemption.
Chapter 679B of the Code of Iowa provides in pertinent part:
When any dispute arises between any ... corporation and their employees ... of this state, except employers or employees having trade relations directly or indirectly based upon interstate trade relations operating through or by state or international boards of conciliation, which has or is likely to cause a strike or lockout, involving ten or more wage earners, and which does or is likely to interfere with the due and ordinary course of business, or which menaces the public peace, or which jeopardizes the welfare of the community, and the parties thereto are unable to adjust the same, either or both parties to the dispute, ... or the chairperson of the board of supervisors of the county in which said employment is carried on ... after investigation, may make written application to the Governor for the appointment of a board of arbitration and conciliation ...
Iowa Code § 679B.1. If the Governor is satisfied that the dispute comes within the provisions of § 679B.1, he is required to appoint a board of arbitration and conciliation. Iowa Code § 679B.2. The method of selecting members of the board of arbitration and conciliation are outlined in Iowa Code §§ 679B.2-4. The parties are given the option as to whether the board's “decision” will be binding. The board has all of the powers of a state district court in civil cases to compel the attendance of witnesses, administer oaths, compel testimony and require the production of books, papers and other documents or things as the board may deem requisite to the full investigation of the matters into which it is inquiring. Iowa Code §§ 679B.8, 10. The board is not bound by rules of evidence and may accept any evidence “as in equity and good conscience it thinks material and proper”. Iowa Code § 679B.9.
The board is commanded pursuant to Chapter 679B to visit the place where the controversy exists and make careful inquiry into the cause of the dispute. The board shall hear all persons interested who come before it, advise the respective parties what ought to be done or submitted by either or both of the parties to the dispute to adjust said controversy, and make a written decision thereof which shall at once be made public and open to public inspection and shall be recorded by the secretary of the Board. Iowa Code § 679B.11. Strikes and lockouts are prohibited pending completion of the board's investigation. Iowa Code § 679B.12.1 The board must render a decision stating such details as will clearly show the nature of the controversy and make a written report to the Governor of its findings of fact and its recommendation to each of the parties to the controversy. Iowa Code § 679B.13. Finally, the decision of the board must be published in two newspapers of general circulation in the county in which the business is located upon which the dispute arose. Iowa Code § 679B.14.
In passing the National Labor Relations Act (“NLRA”), Congress had the intent to enact comprehensive federal law of labor relations. Golden State Transit Corp. v. City of Los Angeles, 493 U.S. 103, 110-11, 110 S.Ct. 444, 107 L.Ed.2d 420 (1989); 29 U.S.C. § 151. The Supreme Court has long held that the act is meant to “prevent unfair labor practice in interstate commerce on the part of those engaged in such commerce....” Foster Bros. Mfg. Co. v. N.L.R.B., 85 F.2d 984, 986 (1936).
When considering whether preemption applies, the Court must first scrutinize the “purpose of Congress” as the “ultimate touchstone” in any preemption analysis. Malone v. White Motor Corp., 435 U.S. 497, 504, 98 S.Ct. 1185, 55 L.Ed.2d 443 (1978) (quoting Retail Clerks v. Schermerhorn, 375 U.S. 96, 103, 84 S.Ct. 219, 11 L.Ed.2d 179 (1963)). Next, the analysis must establish as a “basic assumption” that, despite deference to the Supremacy...
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