Howerton v. EarthGrains Baking Cos., Inc.
| Decision Date | 11 December 2013 |
| Docket Number | Case No. 1:13-cv-01397-AWI-SMS |
| Court | U.S. District Court — Eastern District of California |
| Parties | DARREN HOWERTON, Plaintiff, v. EARTHGRAINS BAKING COMPANIES, INC., a Delaware corporation, et al., Defendants. |
ORDER DENYING
MOTION FOR REMAND
(Doc. 8)
Plaintiff Darren Howerton, by his attorneys, Cornwell & Sample, LLC, and Penner, Bradley & Simonian, moves to remand this case to Fresno County Superior Court. The Court took this motion under submission on October 30, 2013. Having reviewed the complete file, including the parties' briefs and applicable law, the Court concludes that § 301 (29 U.S.C. § 185(a)) of the Labor Management Relations Act of 1947 (29 U.S.C. § 141 et seq.) (the "LMRA") completely preempts Plaintiff's state claims. Accordingly, the Court denies Plaintiff's motion for remand.
On July 30, 2013, Plaintiff filed a complaint in Fresno County Superior Court alleging claims of defamation, violation of California Labor Code §§ 1050 and 1054, intentional andnegligent infliction of emotional distress, and intentional and negligent interference with prospective economic advantage. On August 30, 2013, Defendants removed the case to federal district court, alleging that the LMRA completely preempted Plaintiff's claims and that because Defendants Chuck Linthicum and Kimberly Zepeda, both California residents, were improper and sham parties, the federal district court also had diversity jurisdiction over the dispute.
On September 6, 2013, Defendants moved to dismiss the complaint. On September 27, 2013, Plaintiff moved for remand and sanctions.
According to the complaint, the corporate defendants are entities organized outside the state of California who owned and controlled a bakery plant in Fresno County, California. The individual defendants, Chuck Linthicum and Kimberly Zepeda, were plant managers. Plaintiff began working at the plant in 1987.
In 2004, Plaintiff was promoted to the position of receiving clerk. His job responsibilities included accounting for the flour received and used in plant operations. At some unspecified time following Plaintiff's promotion, an unnamed plant manager recognized that plant operations consumed more flour than that specified by plant policies and product formulations, resulting in a discrepancy between the amount of flour received and the amount of bakery produced. Plaintiff had no control of those policies and formulations.
In 2010, Plaintiff told Linthicum that he was accounting for the additional flour being consumed in plant operations by allocating it to a computer account designated "201-Usage." Linthicum directed Plaintiff not to account for the discrepancy using the 201-Usage account. Plaintiff considered Linthicum to be directing him to depart from proper procedures.
On August 1, 2012, Defendants suspended Plaintiff from his job, alleging that Plaintiff was responsible for the lost inventory. On August 6, 2012, he was terminated formisappropriation of inventory based on Zepeda's written statement, authorized by Linthicum, that Plaintiff was "'misappropriating' and 'altering' ingredient inventory 'contrary to personal and business standards of ethical conduct.'" Doc. 1 at 14. Copies of the notice were served on Plaintiff and placed within his personnel file. Plaintiff maintains that he neither misappropriated nor altered ingredient inventory, but that the flour was being used to produce bakery. Plaintiff interprets Zepeda's statement as stating that he had embezzled or stolen from his employer and contends that her statement injured his reputation and potential for employment.
Federal law empowers a defendant to remove an action to federal court if the district court has original jurisdiction. 28 U.S.C. § 1441(a). "Only state court actions that originally could have been filed in federal court may be removed to federal court by the defendant." Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987). Subject matter jurisdiction may be invoked under 28 U.S.C. § 1331 (federal question) or 28 U.S.C. § 1332(a)(diversity). Defendants argue that both federal question and diversity jurisdiction justified removing this case to federal court. Not surprisingly, Plaintiff disagrees.
District courts have "original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States." 28 U.S.C. § 1331. This means that a complaint must establish either (1) that federal law creates the cause of action or (2) that the plaintiff's right to relief necessarily depends on resolution of a substantial question of federal law. Williston Basin Interstate Pipeline Co. v. An Exclusive Gas Storage Leasehold & Easement in the Cloverly Subterranean, Geological Formation, 524 F.3d 1090, 1100 (9th Cir. 2008). Defendants contend that because Plaintiff was employed under a collective bargaining agreement, the LMRA preempts state laws and creates a federal question in lieu of Plaintiff's state common law claims.
Section 301 of the LMRA, codified at 29 U.S.C. §185(a), provides:
Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce . . . 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.
To ensure uniformity and predictability in the meaning of collective bargaining agreements, § 301 preempts state law rules that substantially implicate the meaning of the terms of collective bargaining agreements. Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 210-11 (1985). A state court suit alleging violation of a provision of a collective bargaining agreement must be brought under § 301 and be resolved by reference to § 301. Id. Section 301 does not preempt substantive rights provided to workers by a state so long as the claim of state-granted rights can be resolved without reference to the collective bargaining agreement. Lingle v. Norge Div. of Magic Chef, Inc., 486 U.S. 399, 409-10 (1988). Put another way, a state court may adjudicate a worker's state law claims "involving labor-management relations only if such [claims] do not require construing collective-bargaining agreements." Id. at 411.
Generally, the "well-pleaded complaint rule" governs the determination of the presence or absence of federal jurisdiction. Caterpillar, 482 U.S. at 392. Under the rule, federal jurisdiction exists only if a federal question is presented on the complaint's face. Id. As Plaintiff points out, a case may not ordinarily be removed to federal court based solely on the defendant's assertion of a federal defense, including a defense of federal preemption. Id. at 393; Franchise Tax Bd. of Cal. v. Construction Laborers Vacation Trust for So. California, 463 U.S. 1, 12 (1983).
But controversies involving collective bargaining agreements fall within an exception to the rule dubbed the "complete preemption doctrine." Galvez v. Kuhn, 933F.2d 773, 776 (9th Cir. 1991). Under the complete preemption doctrine, when federal law has completely preempted an area of state law, any claim based on the preempted state law is a federal claim from its inception and is deemed to have arisen under federal law. Caterpillar, 482 U.S. at 393. Thus, even though Plaintiff purportedly makes his claims under California law, if the Court determines that those claims are completely preempted by § 301, the case was properly removed to federal court, and remand is inappropriate.
See Busey v. P.W. Supermarkets, Inc., 368 F.Supp.2d 1045, 1048 (N.D.Cal. 2005).
Whether or not the complaint explicitly refers to the collective bargaining agreement is not dispositive. Allis-Chalmers, 471 U.S. 202, 210-11 (1985). Instead, preemption exists if the state claims require the court to interpret the collective bargaining agreement or if the state claims are "substantially dependent upon the analysis of the terms of an agreement made between the parties in a labor contract." Lingle, 486 U.S. at 410; Allis-Chalmers, 471 U.S. at 213. As a result, even tort claims such as those advanced by Plaintiff are governed by federal law if their evaluation is "inextricably intertwined with consideration of the terms of [a] labor contract." Allis-Chalmers, 471 U.S. at 213. See also Young v. Anthony's Fish Grottos, Inc., 830 F.2d 993, 999 (9th Cir. 1987) ().
Nonetheless, § 301 does not preempt every claim concerning employment or tangentially implicating a provision of the collective bargaining agreement. Id. at 211. A state claim is not preempted if the court can uphold it without interpreting the terms of the collective bargaining agreement. Id. Thus, a court must determine whether each state claim is a "non-negotiable state law right" that exists independent of the collective bargaining agreement. Id. at 213. The analysis requires the court to look beyond the literal wording of the complaint to its substance.
"Plaintiffs may not avoid removal by 'artfully pleading' their claims to omit references to preemptive federal law." Hyles v. Mensing, 849 F.2d 1213, 1215 (9th Cir. 1988). When federal law completely preempts the state law on which the claim relies, the case may be removed to federal court even if the...
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