Hahn v. Rauch
| Decision Date | 15 August 2008 |
| Docket Number | Case No. 5:08CV1204. |
| Citation | 602 F.Supp.2d 895 |
| Parties | Robert L. HAHN, Plaintiff, v. Daniel J. RAUCH, et al., Defendants. |
| Court | U.S. District Court — Northern District of Ohio |
Natalie F. Grubb, John Stephan Lobur, Grubb & Associates, Medina, OH, for Plaintiff.
Ronald G. Macala, Timothy Paul Piatt, Timothy R. Piatt, Macala, Gore & Piatt, Canton, OH, for Defendants.
This case is before the Court on a motion to remand based upon lack of subject matter jurisdiction filed by the plaintiff Robert L. Hahn ("Hahn" or "Plaintiff"), and a motion for default judgment filed by the counterclaimants based upon Plaintiffs failure to file a timely answer. For the reasons that follow, the Court finds that it lacks subject matter jurisdiction because the defendants fail to establish that Plaintiff's claims are completely preempted. Accordingly, the Court grants the motion to remand and, consequently, declines to rule on the motion for default judgment.
On April 21, 2008, Plaintiff filed this action in the Summit County, Ohio Common Pleas Court (Doc. No. 1-2) (the "Complaint"). In the Complaint, Plaintiff asserts causes of action for slander, libel, and tortious interference with business relationship.
On May 14, 2008, defendants Daniel J. Rauch ("Rauch"), Operative Plasters' and Cement Masons' International Association Local Union 109 (the "Local"), Operative Plasters' and Cement Masons' International Association Local Union 109 Apprenticeship Fund, (the "Fund"), and Operative Plasters' and Cement Masons' International Association (the "Union"), (collectively, "Defendants"), removed this action to federal court on the basis of federal question jurisdiction. (Doc. No. 1.) On June 4, 2008, Defendants filed an answer, and Rauch and the Fund filed a counterclaim, asserting that Hahn breached the fiduciary duty imposed upon him by Section 404(a) of ERISA, 29 U.S.C. § 1104, and engaged in transactions prohibited by Section 406 of ERISA, 29 U.S.C. § 1106. (Doc. No. 6.)
Plaintiff served as the Business Manager and Financial Secretary of the Local from January 1, 2001, to May 23, 2007. (Compl. ¶ 10.) During the same time period, Plaintiff also served as the Trustee, Coordinator, and Secretary Treasurer of the Fund. (Id. ¶ 11.) Plaintiff alleges that on May 22, 2007, Rauch, the International Representative of the Union, wrote a letter to the Union's General President, Patrick Finley, indicating that Plaintiffs driver's license had been revoked after Plaintiff was involved in a traffic accident on May 20, 2007. (Id. ¶ 12.) In the same letter, Rauch also allegedly accused Plaintiff of being responsible for thousands of dollars of unaccounted-for expenditures by the Fund and the Local. (Id. ¶ 13.) According to Plaintiff, on May 23, 2007, the Local submitted the statements contained in Rauch's letter to all of its officers. (Id. ¶ 14.) That same day, Plaintiff was suspended from employment, effectively ending contributions to Plaintiffs health and welfare fund, pension plans, and annuity. (Id. ¶ 15.) On June 21, 2008, Finley commissioned a hearing, during which a report based on Rauch's letter was made. (Id. ¶ 16.) Plaintiff was terminated on July 20, 2007. (Id. ¶ 17.)
In Count I, Plaintiff claims he was slandered by Rauch, whom Plaintiff asserts (Id. ¶ 20.) Plaintiff contends that Rauch submitted the allegedly false statements intentionally and maliciously, and did so without ascertaining the truth or veracity of the statements. (Id. ¶ 21.) Count II accuses Rauch of libeling Plaintiff by "wrongly printing and publishing false and misleading statements." (Id. ¶ 25.) Count II further alleges that Defendants libeled Plaintiff by publishing Rauch's false statements to a third party (presumably by submitting the statements to the Local's officers on May 23, 2007.) Finally, in Count III, labeled "Tortious Interference with Business Relationship," Plaintiff accuses Defendants of tortiously interfering with his employment relationship, alleging that his termination "was a direct and proximate result of the Defendants' intentional contact with the employer." (Id. ¶ 36.)
In the notice of removal, Defendants asserted that resolution of Plaintiffs claims requires interpretation of the Union's constitution, the constitution and bylaws of the Local, and the rules and regulations of ERISA applicable to the Fund. (Notice of Removal, ¶ 3.) Defendants assert that Plaintiffs complaint therefore is completely preempted by section 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185(a) ("Section 301"). (Id.)
Plaintiff moved to remand (Doc. No. 5), arguing that Defendants failed to establish complete preemption, and therefore the Court lacks subject matter jurisdiction. In their opposition to the motion to remand (Doc. No. 7), Defendants added to their preemption argument, asserting that, in addition to LMRA preemption, Plaintiffs complaint also is preempted by Section 2(9) of the National Labor Relations Act ("NLRA"), 29 U.S.C. § 152(9), the Labor Management Reporting and Disclosure Act ("LMRDA"), and ERISA. Plaintiff filed a reply. (Doc. No. 11.)1
In the interim, on June 27, 2008, Rauch and the Fund filed a motion seeking entry of default and default judgment on their counterclaims based upon Plaintiffs failure to respond. (Doc. No. 8.) Later the same day, Plaintiff filed a brief in opposition to the motion for default judgment (Doc. No. 9), and an answer to the counterclaims. (Doc. No. 10.) Because the motion to remand implicates this Court's subject matter jurisdiction, that motion is addressed first.
A. Motion to Remand
A defendant may remove to federal court only state court actions that originally could have been filed in federal court. Caterpillar, Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987). As a court of limited jurisdiction, a federal district court must proceed cautiously in determining that it has subject matter jurisdiction. Musson Theatrical, Inc. v. Fed. Express Corp., 89 F.3d 1244, 1252 (6th Cir.1996). The court must give "due regard" to the power reserved to the states under the Constitution to provide for the determination of controversies in the state courts. Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100, 108-09, 61 S.Ct. 868, 85 L.Ed. 1214 (1941). Accordingly, removal statutes must be construed strictly to promote comity and preserve jurisdictional boundaries between state and federal courts. Alexander v. Elec. Data Sys. Corp., 13 F.3d 940, 949 (6th Cir.1994). "[A]ll doubts as to the propriety of removal are resolved in favor of remand." Coyne v. Am. Tobacco Co., 183 F.3d 488, 493 (6th Cir.1999). The defendant seeking removal bears the burden of proving the court's jurisdiction. See Rogers v. Wal-Mart Stores, Inc., 230 F.3d 868, 871 (6th Cir.2000).
The parties agree that diversity is incomplete, and therefore cannot provide a basis for jurisdiction. Accordingly, this Court has jurisdiction over this case, if at all, based upon the presence of a federal question. The district court has federal question jurisdiction in cases "arising under the Constitution, laws, or treaties of the United States." 28 U.S.C. § 1331. Ordinarily, the "well-pleaded complaint" rule governs the presence or absence of federal question jurisdiction. Caterpillar, 482 U.S. at 392, 107 S.Ct. 2425. Federal question jurisdiction "extends over `only those cases in which a well-pleaded complaint establishes either that federal law creates the cause of action or that the plaintiff's right to relief necessarily depends on resolution of a substantial question of federal law,' in that `federal law is a necessary element of one of the well pleaded ... claims.'" Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 808, 108 S.Ct. 2166, 100 L.Ed.2d 811 (1988) (quoting Franchise Tax Bd. of State of Cal. v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 13, 27-28, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983)).
"[S]tate courts are generally presumed competent to interpret and apply federal law." Mikulski v. Centerior Energy Corp., 501 F.3d 555, 560 (6th Cir. 2007) (citing Zwickler v. Koota, 389 U.S. 241, 245, 88 S.Ct. 391, 19 L.Ed.2d 444 (1967)). The plaintiff is the master of his claim, and may avoid federal jurisdiction by relying exclusively on state law. Beneficial Nat'l Bank v. Anderson, 539 U.S. 1, 12, 123 S.Ct. 2058, 156 L.Ed.2d 1 (2003) (citing Caterpillar, 482 U.S. at 392, 107 S.Ct. 2425). "In particular, the existence of a federal defense normally does not create statutory `arising under' jurisdiction, Louisville & Nashville R.R. Co. v. Mottley, 211 U.S. 149, 29 S.Ct. 42, 53 L.Ed. 126 (1908), and `a defendant may not [generally] remove a case to federal court unless the plaintiffs complaint establishes that the case `arises under' federal law,' Franchise Tax Bd., 463 U.S. at 10, 103 S.Ct. 2841." Aetna Health Inc. v. Davila, 542 U.S. 200, 207, 124 S.Ct. 2488, 159 L.Ed.2d 312 (2004).
An exception to the well-pleaded complaint rule exists, and a state law claim may be removed to federal court "when a federal statute wholly displaces the statelaw cause of action through complete preemption." Beneficial, 539 U.S. at 8, 123 S.Ct. 2058. "When the federal statute completely pre-empts the state law cause of action, a claim which comes within the scope of that cause of action, even if pleaded in terms of state law, is in reality based on federal law." Id. The Sixth Circuit has noted, however, "that `complete preemption' — no matter how powerful when properly present in a case — is of very...
To continue reading
Request your trial
-
Ross v. Haw. Nurses' Ass'n Office & Prof'l Emps. Int'l Union Local 50
...under state law[.]" In re Miles , 430 F.3d 1083, 1088 (9th Cir. 2005).3 The LMRDA is not one of them. See, e.g., Hahn v. Rauch , 602 F.Supp.2d 895, 910 (N.D. Ohio 2008) ("The Supreme Court has never held that the LMRDA completely preempts state law."). And although lower courts may also con......
-
Meritage Homes Corp. v. JPMorgan Chase Bank, N.A.
...in support of removal, which is prohibited after the time for filing the notice of removal has passed. See, e.g., Hahn v. Rauch, 602 F.Supp.2d 895, 909 (N.D.Ohio 2008) (“Defendants did not assert ... complete preemption in the notice of removal. These bases were raised for the first time in......
-
Hechter v. Nationwide Fire Ins. Co.
..."Accordingly, this Court has jurisdiction over this case, if at all, based upon the presence of a federal question." Hahn v. Rauch, 602 F. Supp. 2d 895, 903 (N.D. Ohio 2008). The district court has federal question jurisdiction in cases "arising under the Constitution, laws, or treaties of ......
-
Madsen v. Am. Fed'n of Musicians of the U.S. & Can.
...a labor contract that the Court would be required to interpret, then the first step does not demand preemption. See Hahn v. Rauch, 602 F.Supp.2d 895, 906–07 (N.D.Ohio 2008) ; see also Pearson, 99 Fed.Appx. at 53 (elements of fraud and intentional misrepresentation claims did not require ana......