U.S. for Ben. and on Behalf of Glynn v. Capeletti Bros., Inc.

• Decision Date: 23 July 1980
• Docket Number: No. 78-2031,78-2031
• Citation: 621 F.2d 1309
• Parties: 24 Wage & Hour Cas. (BN 904, 89 Lab.Cas. P 33,931 The UNITED STATES of America for the Benefit of and on Behalf of Matthew GLYNN et al., Plaintiffs-Appellants, v. CAPELETTI BROTHERS, INC., a Florida Corporation, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1309

621 F.2d 1309

24 Wage & Hour Cas. (BN 904, 89 Lab.Cas. P 33,931

The UNITED STATES of America for the Benefit of and on Behalf of Matthew GLYNN et al., Plaintiffs-Appellants, v. CAPELETTI BROTHERS, INC., a Florida Corporation, et al Defendants-Appellees.

No. 78-2031.

United States Court of Appeals Fifth Circuit.

July 23, 1980.

Ira J. Kurzban, Marvin Kurzban, Miami, Fla., for plaintiffs-appellants.

Seyfarth, Shaw, Fairweather & Geraldson, William R. Radford, Stuart A. Goldstein, Miami, Fla., for defendants-appellees.

Appeal from the United States District Court for the Southern District of Florida.

Before MORGAN, ANDERSON and RANDALL, Circuit Judges.

LEWIS R. MORGAN, Circuit Judge.

Section 1 of the Davis-Bacon Act, 40 U.S.C. § 276a, ¹ provides that certain federal construction contracts shall contain a provision stating that laborers and mechanics are to be paid no less than the wages prevailing in the community where the construction work is to be performed. Matthew Glynn and Steven C. Octaviano filed a class action under this section seeking to recover wages which they claimed had been wrongfully withheld by their employer. The District Court for the Southern District of Florida, 448 F.Supp. 66, held that section 1 did not authorize a private remedy and dismissed appellants' action for lack of jurisdiction. The principal question for review is whether section 1 impliedly creates a private right of action in favor of wage earners who have been aggrieved by their employer's failure to pay locally prevailing wages.

I.

In October 1975 Capeletti Brothers, Inc. entered into a contract with the Miami-Dade Water and Sewer Authority to construct a sludge treatment facility at Virginia Key, Miami, Florida. This project was financed in part by the federal government through a grant from the Environmental Protection Agency. As a condition to obtaining a contract to work on this project, both Capeletti Brothers, the general contractor, and each of its subcontractors agreed to comply with the provisions of the Davis-Bacon Act, 40 U.S.C. § 276a et seq., as well as other federal statutes and executive orders. ² In another provision of the contract the contractors agreed to pay laborers and mechanics no less than the prevailing Wage Determinations established by the Florida Department of Commerce in accordance with section 215.19 Florida Statutes. In the event that the federal and state prevailing wage rates disagreed, an addendum to the contract specified that "the higher rate shall apply."

Appellants Glynn and Octaviano are ironworkers who were employed by Independent Steel Erectors, Inc., a subcontractor assigned the steel reinforcement work at the sludge treatment facility. Appellants filed this class action ³ contending that they and other ironworkers employed at the facility had been misclassified as laborers by their employers and, as a result, had been paid below both the federal and state prevailing wage rates for ironworkers. Appellants asserted federal claims under section 1 of the Davis-Bacon Act, 40 U.S.C. § 276a, and section 2 of the Miller Act, 40 U.S.C. § 270b. In addition appellants, invoking pendent jurisdiction, asserted state law claims for breach of contract, unjust enrichment, and fraud.

The district court dismissed appellants' Miller Act claim on the ground that suits on the payment bond required by that act can be brought only under contracts for the construction of public works "of the United States." 40 U.S.C. § 270a. Since this construction project was merely federally assisted, the court ruled that the Miller Act was inapplicable. ⁴ The court did agree with appellants that the Davis-Bacon Act, by virtue of the Federal Water Pollution Control Act, 33 U.S.C. § 1372, ⁵ was applicable to the project. Nevertheless, the court determined that appellants' Davis-Bacon Act claim must also be dismissed because section 1 of that act did not authorize a private right of action in favor of appellants. Having found no basis upon which to predicate federal jurisdiction, ⁶ the court dismissed appellants' pendent state law claims.

Prior to the institution of this action, appellants requested the Department of Labor to initiate an investigation of charges that Independent Steel had paid appellants below the prevailing wage rates required by the contract. ⁷ Within a month from the date of this request, the Department of Labor notified appellants that an investigation would be made and, if violations were found to have occurred, an attempt would be made to recover back wages from Independent Steel. Although the Department of Labor was aware that appellants were also seeking relief in federal district court, it refused to defer its investigation due to the pending litigation. ⁸ On May 5, 1978, the Department of Labor advised Capeletti Brothers (1) that the Department's investigation disclosed violations by Independent Steel in failing to pay the applicable prevailing wage rates and (2) that funds were being withheld from the funds due Capeletti Brothers to cover the payment of back wages due to the employees of Independent Steel. Independent Steel requested a hearing, and in October 1978 the Secretary of Labor entered into a settlement agreement with Capeletti Brothers and Independent Steel concerning the wage dispute. Under the terms of the settlement agreement, Matthew Glynn and Steven C. Octaviano received the full amount of back wages owed to them by Independent Steel. With one or two exceptions, the remaining 28 ironworkers employed by Independent Steel received only a percentage of their computed back wages. The Administrative Law Judge in charge of the case approved the settlement and entered a judgment disposing of "all wage claims made by the Secretary (of Labor) on behalf of employees of Respondent" Independent Steel. ⁹

Appellants raise two arguments on appeal. First, appellants assert that the district court erred in refusing to imply a private right of action under section 1 of the Davis-Bacon Act, 40 U.S.C. § 276a. Second, appellant argues that irrespective of the court's decision on the federal claim, the court erred in dismissing appellants' pendent state law claim.

II.

Possessing no legislative or policymaking authority, a federal court can recognize a cause of action only if it has been created by statute. It follows, therefore, that the sole basis for judicially inferring a private right of action from a statute that does not expressly provide for one is a finding by the court that Congress intended to create a private right. Transamerica Mortgage Advisors, Inc. v. Lewis, 444 U.S. 11, 16, 100 S.Ct. 242, 245, 62 L.Ed.2d 146 (1979) (TAMA); Touche Ross & Co. v. Redington, 442 U.S. 560, 568, 99 S.Ct. 2479, 2485, 61 L.Ed.2d 82 (1979); Cannon v. University of Chicago, 441 U.S. 677, 703, 99 S.Ct. 1946, 1961, 60 L.Ed.2d 560 (1979). Absent such a finding, the court cannot entertain the plaintiff's action even though it determines that a federal statute has been violated and that harm has come to the plaintiff as a result of that violation. In this case we must decide whether, when the Davis-Bacon Act was enacted in 1931 or amended in 1935, Congress intended a private remedy under section 1 of the Act. ¹⁰

When seeking to determine if Congress meant more than it said when it enacted a particular statute, we look to established principles of statutory construction. In Cort v. Ash, 422 U.S. 66, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975), a unanimous Supreme Court listed four factors it considered relevant in determining whether a private remedy is implicit in a statute not expressly providing one:

First, is the plaintiff "one of a class for whose especial benefit the statute was enacted," that is, does the statute create a federal right in favor of the Plaintiff? Second, is there any indication of legislative intent, explicit or implicit, either to create such a remedy or to deny one? Third, is it consistent with the underlying purposes of the legislative scheme to imply such a remedy for the plaintiff? And finally, is the cause of action one traditionally relegated to state law, in an area basically the concern of the States, so that it would be inappropriate to infer a cause of action based solely on federal law?

422 U.S. at 78, 95 S.Ct. at 2088 (citations omitted). While we have cautioned against a mechanical application of these four criteria, this court continues to employ the Cort analysis as a useful tool for discerning legislative intent. Rogers v. Frito-Lay, Inc., 611 F.2d 1074, 1078 (5th Cir. 1980), petition for cert. filed, 48 U.S.L.W. 3769 (May 5, 1980). Using Cort as our guide, we see little evidence that Congress intended to grant a private right of action under section 1.

1. Especial benefit.

The threshold question under Cort is whether the plaintiff is one of the class for whose especial benefit the statute was enacted. This question is answered by looking to the language of the statute itself. Cannon v. University of Chicago, supra, 441 U.S. at 689, 99 S.Ct. at 1953, 60 L.Ed.2d at 571; see TAMA, supra, 444 U.S. at 16, 100 S.Ct. at 245, 62 L.Ed.2d at 152; Touche Ross & Co. v. Redington, supra, 442 U.S. at 568, 99 S.Ct. at 2485, 61 L.Ed.2d at 91 (1979).

Section 1 of the Davis-Bacon Act establishes a minimum wage requirement for laborers and mechanics employed under certain federal construction contracts. The language, indeed the purpose, of the statute clearly reveals that laborers and mechanics are the principal beneficiaries of the act. ¹¹ Recognizing that Congress intended to benefit laborers and mechanics, however, does not establish that Congress intended additionally that section 1 would be enforced through private litigation. TAMA, supra, 444 U.S. at 17, 100 S.Ct. at 246, 62 L.Ed.2d at 153. Therefore, in applying the first Cort factor, the Supreme Court has considered not merely whether the statute was intended to benefit a particular class but whether Congress...