Jones v. General Elec. Co.

• Decision Date: 24 June 1996
• Docket Number: No. 95-2281,95-2281
• Citation: 87 F.3d 209
• Parties: 152 L.R.R.M. (BNA) 2599, 132 Lab.Cas. P 11,606 Jerry JONES, Plaintiff-Appellant, v. GENERAL ELECTRIC COMPANY, Defendant-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 209

87 F.3d 209

152 L.R.R.M. (BNA) 2599, 132 Lab.Cas. P 11,606

Jerry JONES, Plaintiff-Appellant, v. GENERAL ELECTRIC COMPANY, Defendant-Appellee.

No. 95-2281.

United States Court of Appeals Seventh Circuit.

Argued Dec. 6, 1995.

Decided June 24, 1996.

Scott A. Benkie (argued), Timothy P. Brazill, Brazill & Benkie, Indianapolis, IN, for Plaintiff-Appellant.

Thomas A. Herr (argued), Fort Wayne, IN, William Sweet, Beckman, Lawson, Sandler, Snyder & Federoff, Fort Wayne, IN, for Defendant-Appellee.

Before POSNER, Chief Judge, and HARLINGTON WOOD, Jr., and EVANS, Circuit Judges.

HARLINGTON WOOD, Jr., Circuit Judge.

Jerry Jones, as the representative of a group of employees of the General Electric Company's Decatur, Indiana plant, appeals the dismissal of his complaint which sought enforcement of plant closing provisions of a collective bargaining agreement under § 301 of the Labor and Management Relations Act of 1947 ("LMRA"), 29 U.S.C. § 185. Because we find the applicable statute of limitations makes the suit untimely, we affirm the district court's dismissal of the complaint.

I. BACKGROUND

Plaintiff-appellant Jerry Jones brought this case on behalf of a group of former employees of defendant-appellee General Electric's plant in Decatur, Indiana. While at that location, the employees were members of Local 924 of the International Union of Electronic Salaried Machine and Furniture Workers, and were employed under the terms of a collective bargaining agreement in effect from 1988-1991. When the Decatur plant was closed in March of 1989, its former employees were permitted to bid on jobs at General Electric's Fort Wayne, Indiana plant. Plaintiff alleges that they were "told that their seniority and accompanying service credits would start when they commenced work at the Fort Wayne plant," and that the collective bargaining agreement then in force provided that individuals re-employed at a new plant location would have seniority and service credits pursuant to any existing practices and procedures at the new location.

Upon joining the Fort Wayne plant, however, the group discovered that their seniority and service credits accumulated at the Decatur plant had been lost. This was allegedly due to the methods (or lack thereof--the record is unclear) used at the Fort Wayne plant for "endtailing" seniority and service credits. Since no special agreement had been negotiated by the employer and unions concerning plant closing procedures, Jones asserts that these "endtailing" methods violated the terms of the collective bargaining agreement.

Jones alleges the group filed a grievance to restore the lost seniority, and that some former employees filed a complaint with the National Labor Relations Board in June of 1991. While the complaint to the NLRB was dismissed as untimely, the resolution of the grievance is not stated in the record. Jones asserts, however, that all such dispute resolution avenues have been exhausted. Jones also argues that his local union became "defunct" with the closing of the Decatur plant, and that any duty of the union to represent the group was therefore dissolved.

Jones and fellow plaintiffs filed this suit on January 11, 1995, claiming several breaches of the collective bargaining agreement in violation of § 301 of the LMRA. They also requested that their cause be certified as a class action under Fed.R.Civ.P. 23. Defendants responded with a motion to dismiss under Fed.R.Civ.P. 12(b)(6), claiming the complaint was filed beyond the applicable statute of limitations.

The district court granted defendant's motion to dismiss, applying Indiana's two-year statute of limitations for employment-related contract actions, Ind. Code § 34-1-2-1.5. The motion to proceed as a class action was denied as moot. Jones appeals on the sole ground that their claim should be subject to Indiana's ten-year statute of limitations for written contract actions, Ind. Code § 34-1-2-2(6).

II. STANDARD OF REVIEW

We review statute of limitations determinations de novo. Anderson v. Flexel, Inc., 47 F.3d 243, 247 (7th Cir.1995). Dismissal of a complaint is appropriate only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations in the complaint. Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 2232-33, 81 L.Ed.2d 59 (1984) (citing Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957)). We accept as true all well-pleaded factual allegations and draw all reasonable inferences in favor of the plaintiff. Dawson v. General Motors Corp., 977 F.2d 369, 372 (7th Cir.1992).

III. DISCUSSION

Claims asserted under § 301 of the LMRA are not governed by a specific statute of limitations, and therefore courts reviewing claims under that section must borrow an appropriate limitations period. When federal statutes are silent as to limitations periods, federal courts usually borrow the most closely analogous statute of limitations from state law. See Int'l Union, United Auto. Workers of Am. v. Hoosier Cardinal Corp., 383 U.S. 696, 703-04, 86 S.Ct. 1107, 1112-13, 16 L.Ed.2d 192 (1966). A narrow exception to this standard borrowing rule exists when analogous state statutes of limitations would frustrate or significantly interfere with the implementation of national policies or would be at odds with the purpose or operation of federal substantive law. North Star Steel Co. v. Thomas, --- U.S. ----, ---- - ----, 115 S.Ct. 1927, 1930-31, 132 L.Ed.2d 27 (1995) (internal citations omitted).

The question of what time limits apply to § 301 actions is not a new one to this court. The question admits of several answers, however, depending on various contextual factors. To summarize briefly, in so-called "hybrid" cases involving claims against both the employer for breach of contract and against the union for a breach of its duty of fair representation, the Supreme Court has held that federal law provides a six-month time limit in accordance with § 10(b) of the National Labor Relations Act. 29 U.S.C. § 160(b); see DelCostello v. Int'l Bhd. of Teamsters, 462 U.S. 151, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983). Such "hybrid" cases, which implicate federal labor law and important national policies, invoke the "narrow exception" and are to be distinguished from "straightforward" § 301 cases. For cases of the latter type, borrowing an applicable state statute of limitations for breach of contract remains the rule. Indiana law provides three possible limitations periods. For contracts not in writing, six years are allowed. Ind. Code § 34-1-2-1. For "[a]ll actions relating to the terms, conditions, and privileges of employment except actions based upon a written contract (including, but not limited to, hiring or the failure to hire, suspension, discharge, discipline, promotion, demotion, retirement, wages, or salary)," two years is the applicable limit. Ind. Code § 34-1-2-1.5. Finally, for all other contract actions, suit must be brought within ten years. Ind. Code § 34-1-2-3.

We mention these various limitation periods because all of them have been raised in this case. As an initial matter, the parties dispute whether this action should be characterized as a "hybrid" suit, with the defendant asserting that a claim should have been brought against the union. The plaintiff argues, however, that with the Decatur plant's closure his union became "defunct" and thus had no duty to represent him. For reasons that will become apparent below, we find it unnecessary to unravel this issue. For purposes of argument, we may assume, as the parties do, that one of the longer Indiana statutory periods governs. The defendant argues, as the district court found, that the two-year limit for employment-related actions applies on the basis of International Union of Elevator Constructors v. Home Elevator Co., 798 F.2d 222 (7th Cir.1986). The plaintiff counters that the correct limitation period is the general ten-year limit for contracts in writing.

In Home Elevator, we held that Indiana's two-year statute of limitations applies to § 301 cases brought to enforce contractual obligations contained in a collective bargaining agreement. In that case, the plaintiff union discovered that the defendant employer had not paid its employees certain wage rates established by a collective bargaining agreement. In its complaint, the union alleged that the employer had violated the agreement and therefore sought specific performance and damages under § 301 for breach of contract. Id. at 224. Acknowledging that Indiana's two-year statute of limitations for suits involving terms, conditions, and privileges of employment includes the phrase "except actions based on a written contract," we nonetheless concluded that for actions in which "the basic...