Skyline Roofing & Sheet Metal Co.  v. Ziolkowski Constr., Inc.

• Decision Date: 25 October 2011
• Docket Number: No. 71A03–1105–PL–202.,71A03–1105–PL–202.
• Parties: SKYLINE ROOFING & SHEET METAL COMPANY, INC., Appellant–Plaintiff, v. ZIOLKOWSKI CONSTRUCTION, INC., and United Union of Roofers, Waterproofers and Allied Workers Local # 26, Appellees–Defendants.
• Court: Indiana Appellate Court

192 L.R.R.M. (BNA) 2441

2011-2 Trade Cases P 77,649

957 N.E.2d 176

SKYLINE ROOFING & SHEET METAL COMPANY, INC., Appellant–Plaintiff,

v.ZIOLKOWSKI CONSTRUCTION, INC., and United Union of Roofers, Waterproofers and Allied Workers Local # 26, Appellees–Defendants.

No. 71A03–1105–PL–202.

Court of Appeals of Indiana.

Oct. 25, 2011.

Troy M. Miller, V. Samuel Laurin III, Bryan H. Babb, Bose McKinney & Evans, LLP, Indianapolis, IN, Attorneys for Appellant.

Edward B. Keidan, Conway & Mrowiec, Chicago, IL, Beverly J. Mack, Huelat Mack & Kreppein, P.C., Michigan City, IN, Attorneys for Appellee Ziolkowski Construction, Inc.

Paul T. Berkowitz, Paul T. Berkowitz & Associates, Ltd., Chicago, IL, Attorney for Appellee United Union of Roofers, Waterproofers and Allied Workers Local # 26.

OPINION

BARTEAU, Senior Judge.

STATEMENT OF THE CASE

Plaintiff–Appellant Skyline Roofing & Sheet Metal Company, Inc. (“Skyline”), appeals the trial court's dismissal with prejudice of its amended complaint against Defendants–Appellees Ziolkowski Construction, Inc. (“Ziolkowski”), and United Union of Roofers, Waterproofers, and Allied Workers Local # 26 (“Local 26”). We reverse and remand.

ISSUE

Skyline raises several issues, which we consolidate and restate as: whether the trial court erred by dismissing its amended complaint.

FACTS AND PROCEDURAL HISTORY

The following facts were alleged in the amended complaint. The Kankakee Valley School Corporation (“Kankakee Valley”) planned to construct a new middle school in Wheatfield, Indiana. To that end, Kankakee Valley mapped out a campaign that included enlisting unions to help pass a referendum that would eventually fund the new middle school project (“the Project”). Unions placed union members at voting sites to show their support for the referendum and the Project. The referendum passed.

In August 2009, Kankakee Valley issued an advertisement requesting bids for the Project and setting September 17, 2009, as the deadline for such bids. General contractor Ziolkowski, who planned to submit a bid for the Project, invited non-union subcontractor Skyline to bid for the roofing subcontract. On September 16, 2009, union subcontractor Midland Engineering (“Midland”) provided its total bid of $2,572,200 for the roofing subcontract. Skyline provided its total bid to Ziolkowski on September 17, 2009. Skyline's bid was $1,986,984.

Ziolkowski submitted its bid to Kankakee Valley on September 17, 2009. After bids were opened, Kankakee Valley notified Ziolkowski that it was the successful bidder for the Project. Ziolkowski informed Skyline that Skyline had submitted the lowest bid for the roofing subcontract and that Ziolkowski had used Skyline's roofing bid to prepare its bid.

On September 30, 2009, Kankakee Valley received a public records request from Local 26 asking for copies of Ziolkowski's bid documents for the Project, including Ziolkowski's subcontractor list. Local 26 subsequently discovered that Ziolkowski intended to use Skyline as its roofing subcontractor. Ziolkowski and Kankakee Valley began receiving “calls and threats from various unions and union contractors threatening to picket and disrupt the Project and that other union contractors would walk off the Project if a union subcontractor was not used by Ziolkowski for the Roof Work.” Appellant's App. p. 114.

Kankakee Valley and Ziolkowski entered into a contract for the Project. Local 26 made a post-bid contribution of funds to Midland to offset the difference between Skyline's bid and Midland's bid for the roofing subcontract. Ziolkowski awarded the roofing subcontract to Midland. “Kankakee proclaimed its success ... in limiting participation to only union contractors on the Project when its superintendent stated on Kankakee's blog[,] ‘[F]olks may remember we intended our Project to be a local stimulus package and to the best of our ability we have kept that promise.’ ” Id. at 116.

In September 2010, Skyline filed a complaint against Ziolkowski alleging that it colluded with Kankakee Valley to exclude Skyline as the roofing subcontractor in favor of Midland in violation of the Indiana Antitrust Act. Ziolkowski filed a motion to dismiss the complaint for failure to state a claim under Indiana Trial Rule 12(B)(6) and failure to join Local 26, Midland, and Kankakee Valley as necessary parties under Indiana Trial Rule 12(B)(7). In the motion, Ziolkowski also asserted that any antitrust claims were preempted by federal labor laws. Skyline responded, and Ziolkowski replied. After a hearing, the trial court dismissed the complaint without prejudice for failure to state a claim.

In February 2011, Skyline filed an amended complaint against Ziolkowski and Local 26. The amended complaint alleged that Ziolkowski and Local 26 colluded with Kankakee Valley to exclude Skyline as the roofing subcontractor in favor of Midland in violation of the Indiana Antitrust Act:

Thereafter, Kankakee, in an act of quid pro quo and because it was indebted to the unions that supported the Referendum, Ziolkowski and [Local 26] entered into a scheme, contract or combination whereby Ziolkowski would cancel its prior agreement with Skyline for the Roof Work and award the subcontract for the Roof Work to Midland in exchange for [Local 26's] post-bid contribution of funds to Midland to offset the difference between Skyline's bid ... and Midland's bid....

Id. at 114. Skyline claimed that as a result of the antitrust violation, it suffered damages in the form of lost time in preparing a useless bid and lost profits.

Ziolkowski and Local 26 each filed a motion to dismiss the complaint. Each motion claimed that: (1) Skyline's complaint failed to state a claim under Indiana Trial Rule 12(B)(6); (2) Skyline failed to join Midland and Kankakee Valley as necessary parties under Indiana Trial Rule 12(B)(7); and (3) Skyline's allegations were preempted by federal labor laws. Skyline responded to Ziolkowski's motion, and Ziolkowski replied. The trial court dismissed Skyline's complaint with prejudice without a hearing. Skyline now appeals.

DISCUSSION AND DECISION

The purpose of the Indiana Antitrust Act is to prevent fraud and collusion in the letting of contracts and to protect trade and commerce against unlawful restraints and monopolies. Gariup Constr. Co. v. Carras–Szany–Kuhn & Assocs., P.C., 945 N.E.2d 227, 233 (Ind.Ct.App.2011), trans. denied. Here, Skyline filed its complaint under two sections of the Indiana Antitrust Act. Indiana Code section 24–1–2–3 (1978) provides, “A person who engages in any scheme, contract, or combination to restrain or restrict bidding for the letting of any contract for private or public work, or restricts free competition for the letting of any contract for private or public work, commits a Class A misdemeanor.” Indiana Code section 24–1–2–7(a) (2008), in turn, provides a private right of action allowing treble damages, costs, and attorney's fees to “[a]ny person whose business or property is injured by a violation of this chapter.”

The trial court did not specify the grounds on which it dismissed Skyline's complaint. Skyline thus addresses on appeal each of the three grounds set forth in Ziolkowski's and Local 26's motions to dismiss. Skyline contends that the trial court erred by dismissing its amended complaint because: (1) the complaint sufficiently stated a claim under the Indiana Antitrust Act; (2) Skyline did not fail to join necessary parties; and (3) the allegations are not preempted by federal labor laws. We first discuss preemption before addressing the other issues.

I. PREEMPTION

Skyline contends that the trial court erred by dismissing its amended complaint because its Indiana Antitrust Act claim is not preempted by federal labor laws. Local 26 and Ziolkowski respond that the activities described by Skyline in its amended complaint are arguably prohibited by Section 8(b)(4)(ii)(B) of the National Labor Relations Act, which provides in pertinent part, “It shall be an unfair labor practice for a labor organization or its agents ... to threaten, coerce, or restrain any person engaged in commerce or in an industry affecting commerce, where ... an object thereof is ... forcing or requiring any person ... to cease doing business with any other person....” 29 U.S.C. § 158(b)(4)(ii)(B) (1974). Local 26 thus argues that Skyline's claim as to Local 26 is preempted by federal labor laws. In turn, Ziolkowski argues that Skyline's claim as to Ziolkowski must also be preempted by federal labor laws.

Our discussion of preemption in the context of federal labor laws is guided by the United States Supreme Court's decision in San Diego Building Trades Council v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775 (1959). In Garmon, an employer brought an action in California state court when unions picketed the employer's place of business and pressured customers and suppliers to stop dealing with the employer. The Supreme Court of California held that the unions' activities constituted a tort based on an unfair labor practice under state law and affirmed the lower court's award of damages to the employer. On certiorari, the Garmon Court found the state claim preempted and reversed. The Court held that “[w]hen an activity is arguably subject to [Section] 7 or [Section] 8 of the [National Labor Relations] Act, the States as well as the federal courts must defer to the exclusive competence of the National Labor Relations Board if the danger of state interference with national policy is to be averted.” Id. at 245, 79 S.Ct. 773. The Court reasoned:

... To leave the States free to regulate conduct so plainly within the central aim of federal regulation involves too great a danger of conflict between power asserted by Congress and requirements imposed by state law. Nor has it mattered whether the States have acted through laws of broad general application rather than laws specifically directed towards the governance of industrial relations....