Opinion
Case No. 1:03-CV-255
January 7, 2004
ORDER
In accordance with the Opinion issued on this date,
IT IS HEREBY ORDERED that the Individual Defendants' Motions to Dismiss for Lack of Subject Matter Jurisdiction (docket nos. 47, 50, 55, and 60) are GRANTED and LaSalle's claims against the Individual Defendants are dismissed for lack of subject matter jurisdiction.
OPINION
Plaintiff, LaSalle, Inc. ("LaSalle"), filed this action against Defendants, International Brotherhood of Electrical Workers Local 665 (the "Union") and numerous named individual union workers (the "Individual Defendants"), alleging various claims stemming from performance of a construction contract. Now before the Court are the Individual Defendants' motions to dismiss all claims against them for lack of subject matter jurisdiction pursuant to Fed.R.Civ.P. 12(b)(1). For the reasons stated below, the Court will grant the motions to dismiss the Individual Defendants.
I. BACKGROUND
LaSalle's original Complaint named as defendants the Union and numerous unidentified John Doe union members. At a scheduling conference held on June 2, 2003, it was suggested that LaSalle would have to name the John Does individually. On June 27, 2003, LaSalle filed a Notice of Substitution of Doe Defendants and a First Amended Complaint, substituting the named Individual Defendants for the John Does. On August 27, 2003, the Union and the Individual Defendants filed a motion to dismiss the Individual Defendants for failure to serve process. The Court denied that motion in an Order dated October 28, 2003.
The First Amended Complaint's allegations against the Individual Defendants are found in Count III and are limited to state-law claims of tortious interference with an advantageous business relationship. Count III makes the same tortious interference claims against the Union. Counts I, II, and IV of the First Amended Complaint consist of other federal and state law claims against the Union only. Count I asserts a claim of respondeat superior liability pursuant to 29 U.S.C. § 185(b). Count II asserts a claim of unfair labor practices pursuant to 29 U.S.C. § 158 and seeks treble damages pursuant to 29 U.S.C. § 187. Count IV asserts an alternative claim of third party beneficiary breach of contract.
On October 8, 2003, four groups of Individual Defendants filed the four separate but identical motions to dismiss for lack of subject matter jurisdiction and accompanying briefs now before the Court. The first motion (docket no. 47) was filed by the following Individual Defendants: Justin Cuthbert, Kim Rabh, Mario G. Garcia, and Edward Gave. The second motion (docket no. 50) was filed by the following Individual Defendants: Darrell Mahan, Thomas Mullany, William K. Sanders, Scott Starrak, James Vanslyke, Scott D. Rathburn, and Brian N. Grihorash. The third motion (docket no. 55) was filed by the following Individual Defendants: Robert Dahlin, Darin Bacon, Timothy D. Potts, and Richard J. Whitehead. The fourth motion (docket no. 60) was filed by the following Individual Defendants: David R. Smoker, Mark A. Healey, and Shawn Recollet. LaSalle has not filed a brief in response to the Individual Defendants' motions to dismiss.
The Individual Defendants argue that they should be dismissed from this action because the Court lacks original subject matter jurisdiction over the claims against the Individual Defendants, all of which arise under state law, and the Court cannot exercise supplemental jurisdiction over these claims.
II. MOTION TO DISMISS STANDARD
An action may be dismissed if the complaint fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). The moving party has the burden of proving that no claim exists. Although a complaint is to be liberally construed, it is still necessary that the complaint contain more than bare assertions of legal conclusions. Allard v. Weitzman (In re DeLorean Motor Co.), 991 F.2d 1236, 1240 (6th Cir. 1993) (citing Schied v. Fanny Farmer Candy Shops. Inc., 859 F.2d 434, 436 (6th Cir. 1988)). All factual allegations in the complaint must be presumed to be true, and reasonable inferences must be made in favor of the non-moving party. 2Moore's Federal Practice, § 12.34[1][b] (Matthew Bender 3d ed. 2003). The Court need not, however, accept unwarranted factual inferences. Morgan v. Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir. 1987). Dismissal is proper "only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations." Hishon v. King Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 2232 (1984) (citing Conlevy v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02 (1957)).
III. DISCUSSION
A. Local Rule for Filing Response Brief
The local rules governing practice before this Court give a party 28 days to file a brief in response to a dispositive motion. See LCivR 7.2(c) ("Any party opposing a dispositive motion shall, within twenty-eight (28) days after service of the motion, file a responsive brief and any supporting materials.") In this case, the Individual Defendants have certified that they served their motions to dismiss and accompanying briefs on LaSalle on October 7, 2003. The 28 days in which LaSalle had an opportunity to respond have long since passed. Consequently, for purposes of this Opinion the Court has considered only the arguments and authorities offered by the Individual Defendants, as well as the authorities that the Court has found on its own.
B. Jurisdiction Over Claims Against Individual Defendants
LaSalle's First Amended Complaint, paragraph 4, alleges that this Court has subject matter jurisdiction pursuant to 29 U.S.C. § 185 over the claims against the Union, and has "pendent" jurisdiction over the claims against the Individual Defendants. The Court understands LaSalle's use of the word "pendent" to mean "supplemental" as that term is used in the federal supplemental jurisdiction statute, 28 U.S.C. § 1367. The Court concludes that it can and should exercise its discretion to decline an exercise of supplemental jurisdiction over the state-law claims against the Individual Defendants.
1. Subject Matter Jurisdiction
As LaSalle's First Amended Complaint appears to contemplate, and as the applicable law makes clear, the Court lacks original federal subject matter jurisdiction over the Individual Defendants. Section 301 of the Labor Management Relations Act of 1947 ("LMRA"), 29 U.S.C. § 185, governs suits by and against labor organizations. The basis by which LaSalle asserts subject matter jurisdiction over its claims against the Union is set forth in 29 U.S.C. § 185(c), which provides:
For the purposes of actions and proceedings by or against labor organizations in the district courts of the United States, district courts shall be deemed to have jurisdiction of a labor organization (1) in the district in which such organization maintains its principal office, or (2) in any district in which its duly authorized officers or agents are engaged in representing or acting for employee members.29 U.S.C. § 185(c). Section 301 of the LMRA also states:
Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this Act, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.29 U.S.C. § 185(a).
Pursuant to the LMRA, a union may be sued for the acts of its members, but union members are not liable for judgments against the union. "Any money judgment against a labor organization in a district court of the United States shall be enforceable only against the organization as an entity and against its assets, and shall not be enforceable against any individual member or his assets." 29 U.S.C. § 185(b). Courts have interpreted this provision to mean that only unions themselves, not individual union members, can be liable for breach of a collective bargaining agreement such as the contract in this case. For example, inJersey Farms Milk Service, Inc. v. Amalgamated Meat Cutters and Butcher Workmen of North America. AFL-CIO, 297 F. Supp. 1098, 1100 (M.D. Tenn. 1969), the court explained that under 29 U.S.C. § 185(b), "an employer's complaint which seeks damages against individual employees for violation of a collective bargaining agreement does not state a claim for which relief can be granted." In reaching this determination, the Jersey Farms court cited Atkinson v. Sinclair Refining Co., 370 U.S. 238, 82 S.Ct. 1318 (1962), which offers the following historical and policy overview of section 301 of the LMRA, 29 U.S.C. § 185:
When Congress passed s 301, it declared its view that only the union was to be made to respond for union wrongs, and that the union members were not to be subject to levy. Section 301(b) has three clauses. One makes unions suable in the courts of the United States. Another makes unions bound by the acts of their agents according to conventional principles of agency law (cf. s 301(e)). At the same time, however, the remaining clause exempts agents and members from personal liability for judgments against the union (apparently even when the union is without assets to pay the judgment). The legislative history of s 301(b) makes it clear that this third clause was a deeply felt congressional reaction against the Danbury Hatters case (Loewe v. Lawlor, 208 U.S. 274, 28 S.Ct. 301, 52 L.Ed. 488; Lawlor v. Loewe, 235 U.S. 522, 35 S.Ct. 170, 59 L.Ed. 341), and an expression of legislative determination that the aftermath (Loewe v. Savings Bank of Danbury, 236 F. 444 (C.A. 2d Cir.)) of that decision was not to be permitted to recur. In that case, an antitrust treble damage action was brought against a large number of union members, including union officers and agents, to recover from them the employer's losses in a nationwide, union-directed boycott of his hats. The union was not named as a party, nor was judgment entered against it. A large money judgment was entered, instead, against the individual defendants for participating in the plan "emanating from headquarters" ( 235 U.S., at 534, 35 S. Ct., at 173), by knowingly authorizing and delegating authority to the union officers to do the acts involved. In the debates, Senator Ball, one of the Act's sponsors, declared that s 301, "by providing that the union may sue and be sued as a legal entity, for a violation of contract, and that liability for damages will lie against union assets only, will prevent a repetition of the Danbury Hatters case, in which many members lost their homes" (93 Cong. Rec. 5014).370 U.S. at 247-48, 82 S.Ct. at 1324-25.
As the aforementioned authorities demonstrate, the Court lacks original subject matter jurisdiction for breach of contract claims against union members such as the Individual Defendants in this case, and the Individual Defendants cannot be held liable for any judgment against the Union.
2. Supplemental Jurisdiction
Apparently realizing that the Court lacks original federal subject matter jurisdiction over claims against the Individual Defendants, LaSalle's First Amended Complaint alleges that the Court has "pendent" (i.e., supplemental) jurisdiction over the state law claims against the Individual Defendants. The supplemental jurisdiction statute, 28 U.S.C. § 1367, provides in relevant part:
Except as provided in subsections (b) and (c) or as expressly provided otherwise by Federal statute, in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article HI of the United States Constitution. Such supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties.28 U.S.C. § 1367(a), Supplemental jurisdiction is a matter of discretion, not of a plaintiffs right. Habich v. City of Dearborn, 331 F.3d 524, 535 (6th Cir. 2003). In exercising its discretion, the court must look to "considerations of judicial economy, convenience and fairness to litigants" and avoid needless decisions of state law. United Mine Workers of America v. Gibbs, 383 U.S. 715, 726, 86 S.Ct. 1130, 1139 (1966). A district court's ruling declining supplemental jurisdiction will not be disturbed by an appeals court absent an abuse of discretion.Brandenburg v. Housing Auth. of Irvine, 253 F.3d 891, 900 (6th Cir. 2001). The supplemental jurisdiction statute lists circumstances in which a court may decline to exercise supplemental jurisdiction:
(c) The district courts may decline to exercise supplemental jurisdiction over a claim under subsection (a) if —
(1) the claim raises a novel or complex issue of State law,
(2) the claim substantially predominates over the claim or claims over which the district court has original jurisdiction,
(3) the district court has dismissed all claims over which it has original jurisdiction, or
(4) in exceptional circumstances, there are compelling reasons for declining jurisdiction.28 U.S.C. § 1367(c).
The Individual Defendants mistakenly argue that in order to exercise "pendent" (i.e., supplemental) jurisdiction over Plaintiff's state law claims, the Court must first have original jurisdiction over some federal claim against the Individual Defendants. According to the Individual Defendants, "[i]f there is no federal law claim against the individuals and if there is no statute creating federal court subject matter jurisdiction over these individual defendants, then there is no pendent jurisdiction over any of the claims against these individuals, and those claims must all be dismissed." (Ind. Def.'s Br. Supp. Mot. Dismiss at 7.) In support of this view they cite a 1986 case, Prater v. United Mine Workers of America, 793 F.2d 1201 (11th Cir. 1986). The Individual Defendants' flawed argument derives from the pendent jurisdiction doctrine rendered obsolete by the 1990 supplemental jurisdiction statute. A provision of that statute, 28 U.S.C. § 1367(a), gives federal district courts supplemental jurisdiction over all claims that "form part of the same case or controversy" as the claims over which the court exercises original jurisdiction, and "[s]uch supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties." In other words, federal courts may exercise supplemental jurisdiction over "pendent" parties, not just "pendent" claims. See 16 Moore's Federal Practice, § 106.05[2] (Matthew Bender 3d ed. 2003) ("The last sentence of subsection (a) provides that supplemental jurisdiction includes claims that involve the joinder or intervention of additional parties. This sentence clearly overrules both Aldinger v. Howard and Finley v. United States . . . by permitting pendent-parry jurisdiction in all federal question cases.") (footnotes omitted). There is no requirement for a pre-existing federal claim against the Individual Defendants, so long as the state law claims stem from the same case or controversy — and there can be no question in this case that they do.
Although the Individual Defendants' foregoing argument is unavailing, other grounds exist for the Court to deny LaSalle's assertion of supplemental jurisdiction over the claims against the Individual Defendants. Federal courts must decline to exercise supplemental jurisdiction in certain circumstances, and have discretion to do so in other circumstances. See 28 U.S.C. § 1367(a) (permitting supplemental jurisdiction over claims and parties "[e]xcept as provided in subsections (b) and (c) or as expressly provided otherwise by Federal statute").
First, subsection (b) bars supplemental jurisdiction in certain diversity cases. Because this is a federal question case, that subsection does not apply. Next, the statute requires a court not to exercise supplemental jurisdiction if a "federal statute" "expressly provided" that federal district courts should not do so. In addition to examining the express language of a statute, courts must inquire whether the statute negates supplemental jurisdiction by implication. Aldinger v. Howard, 427 U.S. 1, 16, 96 S. Ct 2413, 2421 (1976). The Court can find nothing in the LMRA expressly barring supplemental jurisdiction over LaSalle's state law claims against the Individual Defendants, but the policy and case law surrounding the LMRA discussed earlier in this Opinion suggest that individual union members should not be defendants in a lawsuit that in essence is against a union. These authorities would seem to caution against the exercise of supplemental jurisdiction in this case, where the allegations against the Individual Defendants are closely intertwined with the claims against the Union. Indeed, Count III, which asserts tortious interference claims against the Individual Defendants, asserts the very same claims against the Union and purports to seek relief "as a result of the Union's tortious conduct." (emphasis added).
Even so, the Court need not answer the question of whether the LMRA expressly or by implication bars the exercise of supplemental jurisdiction over the state law claims against the Individual Defendants. Instead, the Court will dismiss those claims pursuant to its discretionary powers under 28 U.S.C. § 1367(c). Subsection (c) grants a court discretion to decline to exercise supplemental jurisdiction over claims that raise novel or complex issues of state law, or that substantially predominate over the claims over which the court has original jurisdiction. Additionally, pursuant to subsection (c), a court may decline to exercise supplemental jurisdiction when the court has dismissed all the claims over which it has original jurisdiction. While the Court can discern no reason for declining to exercise supplemental jurisdiction based on any of these aforementioned rationales, subsection (c) also gives courts discretion to decline jurisdiction when "in exceptional circumstances, there are other compelling reasons" to do so. 28 U.S.C. § 1367(c)(4). As discussed above, without deciding the question, the Court has serious reservations as to whether exercising supplemental jurisdiction over the Individual Defendants would be proper in this case, given the LMRA's language and policy shielding union members from suits that are really against the union itself. Perhaps more importantly, LaSalle has failed to submit a brief offering to the Court any arguments or authorities weighing against dismissal. These circumstances, taken together, provide the Court compelling reason to order dismissal.
III. CONCLUSION
For the reasons stated above, the Court will grant the Individual Defendants' Motions to Dismiss for Lack of Subject Matter Jurisdiction. An Order consistent with this Opinion will be entered.