Smith v. Cigna Healthplan of Arizona, 2 CA-CV 2001-0125.

Citation52 P.3d 205,203 Ariz. 173
Decision Date30 July 2002
Docket NumberNo. 2 CA-CV 2001-0125.,2 CA-CV 2001-0125.
PartiesSandra SMITH, Plaintiff/Appellant, v. CIGNA HEALTHPLAN OF ARIZONA, an Arizona Corporation; Mitchell Hall and Jane Doe Hall, husband and wife; and Gilbert Burkel and Jane Doe Burkel, husband and wife, Defendants/Appellees.
CourtCourt of Appeals of Arizona

Raven & Awerkamp, P.C., By Don Awerkamp, Tucson, for Plaintiff/Appellant.

Titus, Brueckner & Berry, P.C., By John R. Tellier, Scottsdale, for Defendants/Appellees CIGNA and Burkel.

Mesch, Clark & Rothschild, P.C., By Alan N. Ariav, Tucson, for Defendants/Appellees Hall.



¶ 1 Appellant Sandra Smith, M.D., sued appellees, CIGNA HealthPlan of Arizona, Mitchell Hall, and Gilbert Burkel (collectively, "CIGNA") for tortious interference with her employment and wrongful discharge. The trial court granted CIGNA's motion for summary judgment, concluding that Smith's claim was preempted by the National Labor Relations Act, 29 U.S.C. §§ 141 through 187 (the Act). Smith appeals that ruling. Because we conclude the present record establishes that Smith was a supervisor in her position with CIGNA, her claim is not preempted, and we reverse the trial court's judgment.


¶ 2 In reviewing a ruling on a motion for summary judgment, we view the facts and inferences therefrom in the light most favorable to the nonmoving party. Link v. Pima County, 193 Ariz. 336, ¶ 12, 972 P.2d 669, ¶ 12 (App.1998). CIGNA hired Smith as a physician in September 1993 and promoted her to the position of chief of staff of one of its facilities in 1994. CIGNA terminated Smith's employment in October 1995.

¶ 3 In March 1996, Smith filed a claim with the National Labor Relations Board (NLRB), alleging that CIGNA had discharged her in violation of the Act for engaging in protected activity. She alleged that, while working for CIGNA, she had met with other CIGNA physicians "to discuss various issues relevant to working conditions," and CIGNA executives had reprimanded her for organizing the meeting. Smith also alleged that she had voiced concern to other CIGNA physicians about alleged financial mismanagement by CIGNA administrators and that, in response, a CIGNA executive had "severely criticized" her and the other physicians. According to Smith, CIGNA thereafter terminated her employment under the pretext of a staff reduction when "the true motive ... [was] to remove Dr. Smith so she could not continue her protected concerted activity [under the Act] in organizing medical providers to improve their working conditions."

¶ 4 In its position statement to the NLRB, CIGNA argued that Smith's claim was precluded because, in her employment with CIGNA, she "was a supervisory or managerial employee not entitled to [the] protection" of the Act. CIGNA also claimed that the reasons for her termination were not pretextual, but rather, that she had been terminated "due to a reduction in force and consequent job elimination which had nothing to do with any alleged protected concerted activity."

¶ 5 The NLRB regional director denied Smith's claim and refused to issue a complaint against CIGNA, and Smith appealed. In affirming the denial, the NLRB Office of Appeal stated that, "[a]part from the issue of whether Dr. Smith was a `supervisor' within the meaning of [the Act], ... there was insufficient evidence to establish that" CIGNA had violated the Act, adding that "the evidence failed to indicate ... the need for cost reduction was a pretext" for Smith's discharge.

¶ 6 Thereafter, Smith sued CIGNA in Pima County Superior Court, claiming that she had been wrongfully discharged and that appellees Hall and Burkel had tortiously interfered with her employment. Smith based these claims on the same facts she had presented to the NLRB. After CIGNA answered and denied the allegations, it moved to dismiss the complaint for failure to state a claim pursuant to Rule 12(b)(6), Ariz. R. Civ. P., 16 A.R.S., Pt. 1, or, in the alternative, for summary judgment pursuant to Rule 56(c), Ariz. R. Civ. P., 16 A.R.S., Pt. 2. CIGNA contended that the Act preempted Smith's state claims and that the NLRB's decision barred her claims under the doctrines of res judicata and collateral estoppel. Smith responded that her state complaint was not preempted because she had been a supervisor in her employment with CIGNA and, therefore, was not covered by the Act. She also disputed CIGNA's res judicata and collateral estoppel arguments. In reply, CIGNA presented no facts to refute Smith's claim that she had been a supervisor.

¶ 7 The trial court granted CIGNA's motion, concluding that Smith's complaint was preempted because the NLRB's denial indicated that the NLRB had assumed jurisdiction over her claim and her state claim was "largely, if not completely ... identical" to her NLRB claim. The court did not address Smith's contention that she had been a supervisor not covered by the Act. Smith appeals the trial court's ruling.

¶ 8 The trial court did not state whether it treated the motion as one for dismissal or one for summary judgment. But, because CIGNA presented matters extrinsic to the pleadings, and because the court considered these matters in its ruling, we treat the ruling as one granting summary judgment. See Ariz. R. Civ. P. 12(b); Blanchard v. Show Low Planning & Zoning Comm'n, 196 Ariz. 114, ¶ 11, 993 P.2d 1078, ¶ 11 (App.1999). We review a grant of summary judgment de novo. Strojnik v. General Ins. Co. of Am., 201 Ariz. 430, ¶ 10, 36 P.3d 1200, ¶ 10 (App.2001). A motion for summary judgment should be granted if "there is no genuine issue as to any material fact and... the moving party is entitled to judgment as a matter of law." Ariz. R. Civ. P. 56(c); see also Orme School v. Reeves, 166 Ariz. 301, 309, 802 P.2d 1000, 1008 (1990)

. We also review de novo whether the Act preempts a state claim. Hill v. Peterson, 201 Ariz. 363, ¶ 5, 35 P.3d 417, ¶ 5 (App.2001).


¶ 9 Smith argues the trial court erred in ruling her state claims were preempted, asserting that she was a supervisor and that her claim was thus excluded from coverage under the Act. CIGNA counters that Smith may not now claim she was a supervisor, contending she did not raise the issue before the trial court. But the record belies this contention. In her opposition to CIGNA's summary judgment motion, Smith pointed out that the NLRB Office of Appeal had not determined whether she was a supervisor and, citing the facts CIGNA had presented to the NLRB, stated that, "as argued by [CIGNA] previously, [Smith], as a supervisor, is not subject to the protection" of the Act. Accordingly, we address the issue.

¶ 10 Congress promulgated the Act in order to "achieve uniform and effective enforcement of a national labor policy." Hill, 201 Ariz. 363, ¶ 5, 35 P.3d 417, ¶ 5; accord San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775 (1959)

. The Act prescribes a "`comprehensive amalgam of substantive law and regulatory arrangements.'" Chavez v. Copper State Rubber of Arizona, Inc., 182 Ariz. 423, 427, 897 P.2d 725, 729 (App.1995),

quoting Local 926, Int'l Union of Operating Eng'rs v. Jones, 460 U.S. 669, 675, 103 S.Ct. 1453, 1458, 75 L.Ed.2d 368, 375 (1983).

¶ 11 If a state cause of action cannot coexist with the Act's provisions, then preemption applies. Chavez, 182 Ariz. at 427, 897 P.2d at 729. When a party asserts that the Act in fact preempts a state cause of action, it "is a claim that the state court has no power to adjudicate the subject matter of the case," but the question of preemption "must be considered and resolved by the state court." International Longshoremen's Assn., AFL-CIO v. Davis, 476 U.S. 380, 393, 106 S.Ct. 1904, 1913, 90 L.Ed.2d 389, 402 (1986). And, in resolving any such preemption issue, the "first question" is whether the conduct forming the basis of the claim "`is actually or arguably protected or prohibited by [the Act].'" Chavez, 182 Ariz. at 427, 897 P.2d at 729, quoting Local 926, 460 U.S. at 676, 103 S.Ct. at 1458, 75 L.Ed.2d at 375; Rodriguez v. Yellow Cab Coop., 206 Cal. App.3d 668, 253 Cal.Rptr. 779 (1988). Before a state cause of action is preempted, the party asserting preemption has the burden to "put forth enough evidence to enable a court to conclude that the activity is arguably subject to the Act." Davis, 476 U.S. 380 at 396, 397-98, 106 S.Ct. 1904 at 1915, 1916, 90 L.Ed.2d at 404, 405.

¶ 12 At oral argument before this court, CIGNA contended that state courts have jurisdiction over a controversy like the one here only after the NLRB has ruled that the NLRB does not. In support, CIGNA cited Table Talk Pies of Westchester v. Strauss, 237 F.Supp. 514, 519 (S.D.N.Y.1964), which states it is "only if and when the Board has decided that the activities are not within the scope of the federal act that the state courts may thereafter deal with them." But Table Talk dealt with conduct arguably protected or prohibited by the Act. And this district court case was decided before Davis, which makes it clear that state courts determine whether conduct is arguably protected or prohibited by the Act for purposes of preemption. We thus address whether the trial court here correctly decided the preemption issue.

¶ 13 An employer violates the Act by discharging an employee for engaging in protected union activity. 29 U.S.C. § 158(a)(3). However, a supervisor is not an employee explicitly covered by the Act; therefore, if a plaintiff was employed as a supervisor, "the conduct at issue was [not] arguably protected or prohibited by the [Act] ... and there is no preemption." Davis, 476 U.S. at 394, 106 S.Ct. at 1914, 90 L.Ed.2d at 403; accord Chavez, 182 Ariz. at 428,

897 P.2d at 730 ("[A] supervisor's discharge usually is not of concern to the NLRB."). Under the Act, a "supervisor" is

any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off,

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