Hotel & Restaurant Employees Union Local 217 v. J.P. Morgan Hotel

Decision Date14 June 1993
Docket NumberNo. 722,D,722
Citation996 F.2d 561
Parties143 L.R.R.M. (BNA) 2586, 62 USLW 2009, 125 Lab.Cas. P 10,737 HOTEL & RESTAURANT EMPLOYEES UNION LOCAL 217, Plaintiff-Appellant, v. J.P. MORGAN HOTEL, Defendant-Appellee. ocket 92-7925.
CourtU.S. Court of Appeals — Second Circuit

Thomas W. Meiklejohn, Hartford, CT (Gould, Livingston, Adler & Pulda, Hartford, CT, of counsel), for plaintiff-appellant.

Anthony A. Ball, Hartford, CT (Pepe & Hazard, Hartford, CT, of counsel), for defendant-appellee.

Before: CARDAMONE, PIERCE and ALTAMARI, Circuit Judges.

CARDAMONE, Circuit Judge:

The issue before us is one of jurisdiction under § 301(a) of the Labor Management Relations Act of 1947 (Act), 29 U.S.C. § 185(a) (1988). An employer and labor organization signed a contract which, upon the employer's purported repudiation, the union sought to have enforced in the district court. Viewing the agreement as implicating a matter of representation and therefore subject to the primary jurisdiction of the National Labor Relations Board (NLRB or Board), the district court declined jurisdiction. Plainly, a district court should forbear, in obedience to reasoned prudential concerns, from exercising its jurisdiction. But there is a limit beyond which such forbearance ceases to be a virtue. Here, where no prudential concerns are found, that point is reached and jurisdiction over this § 301 contract should have been exercised.

J.P. Morgan Hotel (employer or hotel), operating a hotel and restaurant in Hartford, Connecticut, and Local 217 of the Hotel and Restaurant Employees Union (Local 217 or union) signed a contract that governed their conduct during a union organizing campaign. This so-called neutrality contract designated a procedure by which the union could obtain employer recognition, and further provided that any dispute would be submitted to arbitration. Unfortunately, bad feelings displaced good intentions. A dispute arose regarding whether--using the designated procedure--Local 217 had garnered a majority of hotel employees so as to be entitled to recognition. When this dispute went to the arbitrator, he held for the union, whereupon the hotel repudiated the contract. As a result Local 217 instituted the instant action in August 1991 in the United States District Court for the District of Connecticut (Nevas, J.), seeking declaratory and injunctive relief in the form of an order confirming and enforcing the arbitration award.


Local 217 and the J.P. Morgan Hotel signed a three-page "Memorandum of Agreement" on June 28, 1990. In it the parties contracted that Local 217 could solicit support from a designated bargaining unit of 90 hotel employees, not previously represented by any union. Local 217 undertook to forego the right to picket authorized under the Act, 29 U.S.C. § 158(b)(7)(C) (1988), and in turn the hotel promised the union access to its employees in non-public areas of the hotel. Local 217 pledged it would notify the hotel in advance of visits by its representatives and that during those visits it would not coerce or threaten hotel employees or interfere with hotel operations. The employer agreed not to interfere with the organizing effort or to mount a campaign with its employees opposing the union.

The neutrality contract set forth a "card check" procedure by which the union could show that it had the support of a majority of the employees. The validity of the cards signed by employees was to be determined by a neutral third party. If that third party found a majority of employees had designated Local 217 as their exclusive collective bargaining representative, the contract went on to state, then the employer bound itself to recognize the Local. The hotel further agreed not to file a petition with the NLRB asking for a recognition election. The contract bound the parties to submit any disputes concerning the contract's interpretation or application to arbitration.

An arbitrator was thereafter mutually selected by the parties to review the cards and to resolve any contractual disputes. The union then began its organizing campaign. On January 11, 1991 it informed the hotel that it had cards signed by a majority of hotel employees. A week later the arbitrator conducted a hearing to determine their validity. At the hearing the hotel presented a petition signed by 37 employees who stated they had been coerced into signing designating cards, and it also filed handwritten requests from ten employees seeking to revoke their previously given authorizations. In a ruling dated January 28, 1991 the arbitrator decided the revocations would be ineffective if they were made after January 11, 1991, the date when the union claimed it had gained majority support. He also stated the card count would be delayed until the coercion charges were resolved because authorization cards obtained through coercion were invalid.

The arbitrator proceeded to survey by mail the hotel employees who had both signed authorization cards and either signed the employer's petition or submitted written revocations. None of those surveyed responded--although each received a stamped, self-addressed return envelope--that he or she had been coerced. The arbitrator thereupon ruled on February 18, 1991 that there had been no coercion. Subsequently, on April 10, 1991, the NLRB also dismissed a coercion charge filed on February 15 by a hotel employee against Local 217. The Board found insufficient evidence that the union had restrained or coerced hotel employees during the course of its organizational campaign.

The card count originally had been scheduled by the arbitrator for January 1991. But he had held the matter in abeyance pending the NLRB's just-cited investigation into a coercion charge. Before the Board ruled on that charge, the hotel terminated the agreement. In a letter dated March 7, 1991 it cited "union coercion" and "the union's other actions in violation of the Agreement" as justifications for its withdrawal. The employer subsequently refused to deal with the arbitrator because the contract from which he derived his authority was now, as a result of the hotel's action, "defunct."

The arbitrator nonetheless issued a ruling on May 20, 1991 in which he found the hotel bound by the neutrality contract because it was not terminable at will and because there was no evidence the union had been guilty of violating its terms. The arbitrator ordered the hotel to produce documents to allow him to validate employee signatures on the union authorization cards. This validation check was completed on July 3, and it was determined that the union had attained majority support. Local 217 attempted unsuccessfully to schedule bargaining sessions with the hotel on July 8 and July 18, 1991.

When the union commenced the instant action in August 1991 the hotel moved to dismiss the suit for lack of subject matter jurisdiction, pursuant to Fed.R.Civ.P. 12(b)(1). The union cross-moved for summary judgment enforcing the arbitration award. In a judgment filed February 12, 1992 the district court held that § 301(a) of the Act did not grant it jurisdiction over this representation dispute and dismissed Local 217's complaint. It also dismissed as moot the union's motion for summary judgment.

I Federal Courts' Jurisdiction Under § 301(a)
A. The Statute

In granting the employer's motion to dismiss, the district court believed the parties' neutrality agreement was not a "contract" falling within § 301(a) because it did not govern the terms and conditions of hotel workers' employment. It also believed the pact sought to bypass Board procedures for representation elections. Hence, it ruled that it lacked subject matter jurisdiction to grant the declaratory and injunctive relief sought.

Questions of subject matter jurisdiction are questions of law that we review de novo. The NLRB has primary jurisdiction over matters unique to labor management relations arising under the Act. It is charged with resolving unfair labor practices and representation issues, such as defining a bargaining unit and certifying an exclusive bargaining agent. See 29 U.S.C. §§ 159, 160 (1988) (referring respectively to representation and unfair labor practices); see also Amalgamated Clothing & Textile Workers Union v. Facetglas, Inc., 845 F.2d 1250, 1251-52 (4th Cir.1988). But those disputes that arise under a contract may under § 301(a) of the Act be determined in a judicial, rather than the administrative, forum.

An examination of § 301 leads us to conclude there is federal court jurisdiction. The statute states:

Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.

29 U.S.C. § 185(a) (1988). The section grants subject matter jurisdiction to a district court in an action for violation of a contract between an employer and a labor organization in an industry affecting commerce. This plain language confers jurisdiction on the district court on the facts of this case.

B. Courts' Concurrent Jurisdiction with the NLRB Under § 301(a)

Concededly, the Board enjoys broad authority in the representation area of labor law. For example, an employer generally may insist upon a Board-conducted election to determine whether a majority of its workers supports an organizing union. See Linden Lumber Div., Summer & Co. v. NLRB, 419 U.S. 301, 310, 95 S.Ct. 429, 434, 42 L.Ed.2d 465 (1974). Further, the Board's selection of an appropriate bargaining unit is so firmly within its discretionary power that it is seldom if ever disturbed. See South Prairie Constr. Co. v. Local No. 627, Int'l Union of Operating Eng'rs, 425 U.S....

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