Miller v. Sw. Airlines Co.

• Decision Date: 13 June 2019
• Docket Number: No. 19-1785,No. 18-3476,18-3476
• Citation: 926 F.3d 898
• Parties: Jennifer MILLER, Scott Poole, and Kevin Englund, Plaintiffs-Appellants, v. SOUTHWEST AIRLINES CO., Defendant-Appellee. David Johnson, individually and on behalf of a class, Plaintiff-Appellee, v. United Airlines, Inc., and United Continental Holdings, Inc., Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

926 F.3d 898

Jennifer MILLER, Scott Poole, and Kevin Englund, Plaintiffs-Appellants,

v.SOUTHWEST AIRLINES CO., Defendant-Appellee.

David Johnson, individually and on behalf of a class, Plaintiff-Appellee,

v.United Airlines, Inc., and United Continental Holdings, Inc., Defendants-Appellants.

No. 18-3476

No. 19-1785

United States Court of Appeals, Seventh Circuit.

Argued May 28, 2019

Decided June 13, 2019

Steven Alan Hart, Esq., John Shannon Marrese, Attorneys, Hart McLaughlin & Eldridge, LLC, Chicago, IL, for Plaintiffs-Appellants.

Melissa A. Siebert, Jonathon Studer, Matthew C. Wolfe, Attorneys, Shook, Hardy & Bacon LLP, Chicago, IL, for Defendant-Appellee.

Before Wood, Chief Judge, and Bauer and Easterbrook, Circuit Judges.

Easterbrook, Circuit Judge.

We have consolidated two appeals that pose a common question: whether persons who contend that air carriers have violated state law by using biometric identification in the workplace must present these contentions to an adjustment board under the Railway Labor Act (RLA), 45 U.S.C. §§ 151 – 88, which applies to air carriers as well as railroads. 45 U.S.C. § 181. The answer is yes if the contentions amount to a "minor dispute"—that is, a dispute about the interpretation or application of a collective bargaining agreement. 45 U.S.C. §§ 151a, 184 ; Hawaiian Airlines, Inc. v. Norris , 512 U.S. 246, 252–53, 114 S.Ct. 2239, 129 L.Ed.2d 203 (1994). Plaintiffs insist that a judge should resolve their contentions, while defendants contend that resolution belongs to an adjustment board.

The claims in each suit arise under the Biometric Information Privacy Act (BIPA), 740 ILCS 14/5 to 14/25, which Illinois adopted in 2008. This law applies to all biometric identifiers, which the statute defines to include fingerprints. 740 ILCS 14/10. Before obtaining any fingerprint, a "private entity" must inform the subject or "the subject’s legally authorized representative" in writing about several things, such as the purpose of collecting the data and how long they will be kept, and obtain the consent of the subject or authorized representative. 740 ILCS 14/15(b). The private entity also must establish and make available to the public a protocol for retaining and handling biometric data, which must be destroyed "when the initial purpose for collecting or obtaining such identifiers or information has been satisfied or within 3 years of the individual’s last interaction with the private entity, whichever occurs first." 740 ILCS 14/15(a). Sales of biometric information are forbidden, 740 ILCS 14/15(c), and transfers are limited, 740 ILCS 14/15(d). Private entities must protect biometric information from disclosure. 740 ILCS 14/15(e).

Both Southwest Airlines and United Airlines maintain timekeeping systems that require workers to clock in and out with their fingerprints. Plaintiffs contend that the air carriers implemented these systems without their consent, failed to publish protocols, and use third-party vendors to implement the systems, which plaintiffs call a forbidden disclosure. Southwest and United contend that the plaintiffs’ unions have consented—either expressly or through the collective bargaining agreements’ management-rights clauses—and that any required notice has been provided to the unions. The air carriers insist that, to the extent these matters are disputed, an adjustment board rather than a judge must resolve the difference—and that if state law gives workers rights beyond those provided by federal law and collective bargaining agreements, it is preempted by the Railway Labor Act.

The suits were assigned to different district judges.

Judge Aspen found that the plaintiffs have standing under Article III but dismissed the suit against Southwest Airlines for improper venue. Fed. R. Civ. P. 12(b)(3). 2018 U.S. Dist. LEXIS 143369 (N.D. Ill. Aug. 23, 2018). He made clear, however, that the suit did not belong in state court or some other federal district court; he held, rather, that it belongs to an adjustment board under the Railway Labor Act and that any attempt by Illinois to give workers rights to bypass their union (Transportation Workers Union Local 555) and deal directly with an air carrier is preempted by federal law. Thus dismissal has nothing to do with venue. See 28 U.S.C. § 1391.

Dismissal should have been labeled either as a judgment on the pleadings, Fed. R. Civ. P. 12(c), or a dismissal for lack of subject-matter jurisdiction, as this circuit’s decisions suggest. See, e.g., Carlson v. CSX Transportation, Inc ., 758 F.3d 819, 824–25 (7th Cir. 2014) ; Brotherhood of Maintenance of Way Employees v. Norfolk Southern Ry ., 745 F.3d 808 (7th Cir. 2014) ; Brown v. Illinois Central R.R ., 254 F.3d 654 (7th Cir. 2001). But see, e.g., Oakey v. U.S. Airways Pilots Disability Plan , 723 F.3d 227 (D.C. Cir. 2013) (need to resolve a dispute under the Railway Labor Act’s procedures does not imply lack of subject-matter jurisdiction); Emswiler v. CSX Transportation, Inc ., 691 F.3d 782 (6th Cir. 2012) (same). None of this circuit’s decisions considers the effect of the Supreme Court’s modern understanding of the difference between "jurisdiction" and other kinds of rules. See Fort Bend County v. Davis , ––– U.S. ––––, 139 S.Ct. 1843, 204 L.Ed.2d 116 (2019) (discussing the difference); Carlson , 758 F.3d at 831 (recognizing that this court has yet to consider how the distinction applies to the Railway Labor Act). It is unnecessary to do so here, for either a substantive or a jurisdictional label ends the litigation between these parties and forecloses its continuation in any other judicial forum.

The suit against United Airlines was filed in state court and removed to federal court on two theories: federal-question jurisdiction under the Railway Labor Act plus removal jurisdiction under 28 U.S.C. § 1453, part of the Class Action Fairness Act (CAFA). Judge Kendall concluded that the subject is in the bailiwick of plaintiffs’ union (International Association of Machinists and Aerospace Workers) and an adjustment board; this aspect of her decision reaches the same conclusion as Judge Aspen. But Judge Kendall added that the complaint did not present a case or controversy, because the class asserted only a bare procedural right. This led her to dismiss for lack of jurisdiction. 2018 U.S. Dist. LEXIS 127959 (N.D. Ill. July 31, 2018).

The class, which wants to litigate in state court, protested, observing that if there is no federal jurisdiction then the suit must be remanded. 28 U.S.C. § 1447(c). Judge Kendall agreed. United also complained about the initial decision. Observing that the jurisdictional question had not been raised or briefed by the parties, United maintained that plaintiffs have standing because they allege (or at least imply) that biometric data had been transmitted outside United and may have reached inappropriate hands. Judge Kendall refused to revisit that subject, however, and entered an order returning the case to state court. 2019 U.S. Dist. LEXIS 43484 (N.D. Ill. Mar. 18, 2019).

The remand of a suit removed under the Class Action Fairness Act is appealable with judicial permission, 28 U.S.C. § 1453(c)(1), and United asked us to accept its appeal. The statute makes appellate authority turn on removal under the Class Action Fairness Act, not on whether the appeal presents an issue about the interpretation of that statute. This, plus the disparate outcomes of the two suits, led us to accept the appeal even on the assumption that the only issues concern the interaction between Illinois law and the Railway Labor Act. (That assumption may be incorrect. We’ll return to the question how the Class Action Fairness Act applies to the removal of the suit against United.)

Subject-matter jurisdiction is the first issue in any case, and as far as we can see the two suits are identical in this respect. Judge Aspen found that fingerprinted workers have standing, but Judge Kendall thought that a violation of the state statute does not cause concrete injury to anyone, so that the workers lack standing. See, e.g., Spokeo, Inc. v. Robins , ––– U.S. ––––, 136 S. Ct. 1540, 194 L.Ed.2d 635 (2016) ; Groshek v. Time Warner Cable, Inc ., 865 F.3d 884 (7th Cir. 2017) ; Casillas v. Madison Avenue Associates, Inc ., No. 17-3162, 926 F.3d 329, 2019 WL 2353211 (7th Cir. June 4, 2019). We disagree with Judge Kendall’s conclusion, for two principal reasons.

First, the stakes in both suits include whether the air carriers can use fingerprint identification. If the unions have not consented, or if the carriers have not provided unions with required information, a court or adjustment board may order a change in how workers clock in and out. The prospect of a material change in workers’ terms and conditions of employment gives these suits a concrete dimension that Spokeo , Groshek , and Casillas lacked. Either the discontinuation of the practice, or the need for the air carriers to agree to higher wages to induce unions to consent, presents more than a bare procedural dispute. See Robertson v. Allied Solutions, LLC , 902 F.3d 690, 697 (7th Cir. 2018) ("Article III’s strictures are met not only when a plaintiff complains of being deprived of some benefit, but also when a plaintiff complains that she was deprived of a chance to obtain a benefit.").

Second, plaintiffs assert that the air carriers are not following the statutory data-retention limit and may have used outside parties to administer their timekeeping systems. The longer data are retained, and the more people have access, the greater the risk of disclosure (including by dissatisfied employees who misuse their access or by criminals who hack into a computer system). This was Judge Aspen’s rationale for finding standing. 2018 U.S. Dist. LEXIS 143369 at *5–10. Some employees devote time and money to safeguards against identity theft. That’s why we held in Remijas v. Neiman Marcus Group, LLC , 794 F.3d 688 (7th Cir. 2015), that a suit contending that...