United Food & Commercial Workers Union v. Albertson's

• Decision Date: 16 March 2000
• Docket Number: No. 98-2267,98-2267
• Citation: 207 F.3d 1193
• Parties: (10th Cir. 2000) UNITED FOOD & COMMERCIAL WORKERS UNION, Local 1564 of New Mexico, Plaintiff - Appellee, v. ALBERTSON'S, INC., Defendant - Appellant
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1193

207 F.3d 1193 (10th Cir. 2000)

UNITED FOOD & COMMERCIAL WORKERS UNION, Local 1564 of New Mexico, Plaintiff - Appellee, v. ALBERTSON'S, INC., Defendant - Appellant.

No. 98-2267

UNITED STATES COURT OF APPEALS TENTH CIRCUIT

March 16, 2000

Appeal from the United States District Court for the District of New Mexico. D.C. No. CIV-97-789-MV/LFG

Thomas L. Stahl (Edward Ricco with him on the briefs) of Rodey, Dickason, Sloan, Akin & Robb, P.A., Albuquerque, New Mexico, for the appellant.

Shane C. Youtz of Youngdahl & Sadin, P.C., Albuquerque, New Mexico, for the appellee.

Before ANDERSON, HENRY and LUCERO, Circuit Judges.

LUCERO, Circuit Judge.

This case presents the question of whether a federal court has jurisdiction to adjudicate a union's declaratory judgment claim, premised on the federal question statute, 28 U.S.C. § 1331, and the Declaratory Judgment Act of 1934, 28 U.S.C. § 2201, that a collective bargaining agreement contains terms that run afoul of the Fair Labor Standards Act of 1938 ("FLSA"), 29 U.S.C. §§ 201-219. At the time this litigation was filed, federal jurisdiction was soundly based on § 301(a) of the Labor Management Relations Act of 1947 ("LMRA"), 29 U.S.C. § 185(a), as interpreted by this court in McNally Pittsburg, Inc. v. International Ass'n of Bridge, Structural & Ornamental Iron Workers, 812 F.2d 615, 617-19 (10th Cir. 1987). In the interim, however, the Court has handed down its decision in Textron Lycoming Reciprocating Engine Division, AVCO Corp. v. UAW, 523 U.S. 653, 118 S. Ct. 1626 (1998), holding that jurisdiction does not lie under § 301(a) for a declaratory judgment suit alleging the invalidity, but not a party's violation, of a collective bargaining agreement--clearly rejecting our prior interpretation of § 301(a) and eliminating that jurisdictional basis. Appellee now appears before us asserting a different jurisdictional basis, hoping to preserve its favorable decision below by relying on the argument that this case "arises under" the FLSA so as to permit federal question jurisdiction pursuant to 28 U.S.C. § 1331 and the Declaratory Judgment Act. We reluctantly conclude that the FLSA's prohibition on injunctive and representative damages suits by unions, see 29 U.S.C. § 216(b), renders this argument unavailing. If the FLSA bars a labor organization from seeking legal and equitable relief thereunder on behalf of its members, it necessarily follows that declaratory relief is likewise impermissible, and therefore the FLSA cannot furnish grounds for federal question jurisdiction and the case must be dismissed for lack of jurisdiction.

I

This case involves the collective bargaining agreement that applies to grocery clerks working at Albertson's stores in New Mexico. Because Albertson's sells alcoholic beverages, New Mexico's Alcohol Server Education Article of the Liquor Control Act ("ASEA"), N.M. Stat. Ann. § 60-6E-1 to -6E-12 (Michie 1978 & 1999 Supp.), requires that, in order for the company to continue to sell alcohol, it certify that all its employees selling alcohol have completed a state-approved alcohol server education program. See N.M. Stat. Ann. § 60-6E-4. Albertson's imposes as a condition of employment a requirement that employees complete this training, which takes about four to five hours, and must be renewed every five years. See N.M. Stat. Ann. § 60-6E-7. The company does not pay employees for the training time.

The United Food and Commercial Workers Union, Local 1564 of New Mexico ("UFCW") initiated arbitration, alleging that the training time was work covered by the collective bargaining agreement, and that the arbitrator should interpret the agreement in light of the FLSA. The arbitrator stated he had no authority to interpret the FLSA and decided that the agreement does not cover ASEA training time.

In June 1997, the UFCW filed suit in district court, alleging that the agreement, as interpreted, was invalid because it conflicts with the FLSA.¹ According to its complaint, the agreement as interpreted violates the FLSA by denying employees compensation for hours that constitute "work" within the meaning of the statute. On cross-motions for summary judgment, the district court found it had jurisdiction over this controversy under the Declaratory Judgment Act and 28 U.S.C. § 1331, the general federal question statute. Following a bench trial, the district court held that the training was covered work under the FLSA, and therefore the agreement's (implied) term excluding training from covered work contravened the statute. It declared the term invalid and ordered the UFCW and Albertson's to renegotiate the offending provision. Albertson's now appeals.

II

As an initial matter, we must determine whether federal jurisdiction is proper in this action. Although the district court concluded that jurisdiction "is proper where the real dispute revolves around whether the parties have a valid collective bargaining agreement," United Food & Commercial Workers Union, Local 1564 v. Albertson's, Inc., No. CIV 98-0789 (D.N.M. July 23, 1998), mem. op. at 4 (citing Teamsters, Local 1872 v. New York State Teamsters Health & Hosp. Fund, 909 F. Supp. 102 (N.D.N.Y. 1995)), the issue of federal court jurisdiction over declaratory judgment suits alleging invalidity of collective bargaining agreements has become substantially more complicated since the Supreme Court's recent decision in Textron, 118 S. Ct. at 1626.

A

Section 301(a) of the LMRA provides, in relevant part, that "[s]uits for violation of contracts between an employer and a labor organization . . . may be brought in any district court of the United States." 29 U.S.C. § 185(a). In McNally Pittsburg, Inc., 812 F.2d at 619, we interpreted this provision broadly to confer jurisdiction on the federal courts over a declaratory judgment "complaint which address only the validity and not a violation of a collective bargaining agreement," id. at 617.

In Textron, 118 S. Ct. at 1629, however, the Supreme Court held, based on a dictionary definition analysis of the language of LMRA § 301(a), that "'[s]uits for violation of contracts' under § 301(a) are not suits that claim a contract is invalid, but suits that claim a contract has been violated." This holding overrules our decision in McNally Pittsburg, Inc., 812 F.2d at 617-19, wherein we held that § 301(a) provides for federal jurisdiction over a union's declaratory judgment action asserting only the invalidity of a collective bargaining agreement, but not a violation of that agreement by a party thereto.

The Textron Court also considered whether federal jurisdiction extends to the declaratory judgment aspect of a union's suit alleging that a collective bargaining agreement is invalid due to fraud. Assuming (albeit skeptically) without deciding that "a declaratory-judgment complaint raising a nonfederal defense [i.e. fraud] to an anticipated federal claim [i.e., breach of the collective bargaining agreement]--would confer § 1331 jurisdiction," 118 S. Ct. at 1630, the Court held that there was no federal jurisdiction because the union had demonstrated no case or controversy. See id. at 1631. The Court noted--and Justice Breyer's concurrence emphasized--that there was no allegation that a strike was imminent and the union faced suit for striking in violation of the collective bargaining agreement. See id.; see also id. at 1632-33 (Breyer, J., concurring). The Court specifically declined to reach the issue of the union's assertion that "there may well be jurisdiction over this case under 28 U.S.C. § 1331 as well as under § 301, since the case 'arises under' the federal common law of contract." Id. at 1628 n.1.

Therefore, because Textron has squarely overruled McNally Pittsburg, federal jurisdiction does not exist solely by virtue of the fact that this case implicates a declaratory judgment suit challenging the validity of a federally regulated collective bargaining agreement. We must rather inquire whether § 1331, the general federal question statute, combined with the declaratory judgment posture of the case, permits federal jurisdiction over this case as one "arising under" federal law, namely the FLSA. The UFCW does not rely on the dubious "federal common law of contract" to establish jurisdiction under 28 U.S.C. § 1331; rather, it claims the case "arises under" the FLSA. Cf. International Union of Operating Eng'rs, Local 150 v. Rabine, 161 F.3d 427, 431 (7th Cir. 1998) (holding that there is "no general federal power over the law of contract") (citing Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938)).

Textron contemplated the possibility of federal jurisdiction in a case where a union files a declaratory judgment action seeking to raise a defense of invalidity based on federal law against an anticipated action by an employer for breach of contract. In a declaratory judgment posture, "if, but for the availability of the declaratory judgment procedure, the federal claim would arise only as a defense to a state created action, jurisdiction is lacking." Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 16 (1983) (internal quotation and citation omitted). Under the Supreme Court's declaratory judgment jurisdiction cases, however the presumptive anticipated suit--a federal defense, FLSA invalidity, to a federal claim that an anticipated strike will violate the collective bargaining agreement--would appear to permit jurisdiction. See id. at 19 n.19. This is because federal jurisdiction would clearly exist over the employer's anticipated suit for violation of the labor agreement pursuant to 29 U.S.C. § 185(a). Despite this apparent basis for federal jurisdiction, the Court in Textron stringently applied the case or controversy requirement for standing, and concluded that federal jurisdiction would be lacking absent allegations of a threat to strike in violation of the collective bargaining agreement. See Textron, 118 S. Ct. at 1630-31. Such...