Lead Opinion
This is an appeal from the dismissal of Davis’ complaint against his former employer Ohio Barge Line, Inc. [OBL] and the National Maritime Union of America, AFL-CIO, Port of Pittsburgh [Union]. The central issue on appeal is whether the district court erred in dismissing two counts of his complaint for want of subject matter jurisdiction under section 801 of the Labor Management Relations Act of 1947, 29 U.S.C. § 185. We will vacate the dismissal and remand to the district court.
I.
When a case comes to us from a jurisdictional dismissal granted on defendants’ motion pursuant to Fed.R.Civ.P. 12(b)(1), the factual allegations of the complaint must be taken as true for purposes of our review. Garrett v. Bamford,
On January 2, 1981, OBL again discharged Davis. This time Davis protested to the Union, which processed a grievance pursuant to the collective bargaining agreement. That agreement stated that employees could be “laid off” during the first 90 days work, but has no such express provision in the section dealing with employee “discharge.” For purposes of the arbitration hearing on Davis’ grievance, counsel for OBL and the Union stipulated that deckhands with less than 90 days active service aboard a ship are considered probationary employees who can be discharged without cause. The parties further stipulated that the arbitrator should initially decide whether or not Davis, who at the time of discharge had 83 active onboard work days, was a probationary employee. The arbitrator analyzed both the collective bargaining agreement and the settlement agreement, concluded that Davis was a probationary employee who could be discharged without cause, and entered an award denying the grievance and sustaining the discharge.
Davis then filed this action against both OBL and the Union in the United States District Court for the Western District of Pennsylvania, seeking damages, costs, attorney’s fees, reinstatement, injunctive relief and/or rehearing. His complaint contained three separate counts. Count One asserted a cause of action against OBL for wrongful discharge and a corresponding claim against the Union for breach of its duty of fair representation. Count Two sought to vacate or modify the arbitrator’s award on the ground that the arbitrator exceeded his powers under the collective bargaining agreement, and failed to conform to its procedural requirements. Jurisdiction as to both counts was invoked pur
The district court granted the defendants’ motions to dismiss Counts One and Two for lack of subject matter jurisdiction on the ground that they were based on alleged violations of the settlement agreement, which did not constitute a “contrac[t] between an employer and a labor organization” within the meaning of section 301. The court also dismissed Count Three on the basis that section 503 of the Rehabilitation Act did not confer a private right of action. Davis v. Ohio Barge Line, Inc.,
II.
A.
Count One
As the Supreme Court has stated, it is well established that in passing on a motion to dismiss on the ground, inter alia, of lack of jurisdiction over the subject matter, the allegations of the complaint should be construed favorably to the pleader. Scheuer v. Rhodes,
Section 301(a) of the Labor Management Relations Act provides:
Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, 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). To fall within that section it is necessary only that the plaintiff be asserting a violation of a contract between an employer and a union.
In Chasis v. Progress Manufacturing Co.,
Moreover, the basic purpose of the statute involved, viz., § 301(a), was not to limit, but to expand, the availability of forums for the enforcement of contracts made by labor organizations. Dowd Box Co. v. Courtney,368 U.S. 502 , 508,82 S.Ct. 519 [523],7 L.Ed.2d 483 (1962). The statute is not to be given a narrow reading as Congress intended to have the administration of collective bargaining contracts accomplished under a uniform body of substantive law. Smith v. Evening News Ass’n,371 U.S. 195 , 199,83 S.Ct. 267 [269-270],9 L.Ed.2d 246 (1962).
Id. at 777.
In this case the district court held that the “essence of plaintiff’s allegations
The district court’s conclusion that plaintiff claimed only under the settlement agreement is belied by the clear language of the complaint. The gravamen of plaintiff’s action for wrongful discharge is the discharge in violation of the agreement precluding discharge except for proper cause. As the language of the complaint and the two agreements attached as exhibits make clear, only the collective bargaining agreement imposed a requirement of proper cause before discharge. Thus it is the collective bargaining agreement which is the source of the obligation sought to be enforced. See Wilkes-Barre Publishing Co. v. Newspaper Guild of Wilkes-Barre Local 120,
Davis contends that even if he were relying only on the settlement agreement, there would be section 301 jurisdiction in the district court. Assuming, as alleged, that the Union approved the settlement agreement, including its retroactive seniority provisions, even though it failed to sign it, it does not follow that the agreement qualifies as a contract “between an employer and a labor organization representing employees” within section 301(a). A private agreement between an employer and employee independent of a collective bargaining agreement generally does not fall within section 301(a) even though the complaint alleges some nexus with the union. Cf. Local No. 1 (ACA) v. International Brotherhood of Teamsters,
Therefore, we must consider defendants’ contention that the essence of Count One of the complaint is the alleged violation by the employer of the settlement agreement, rather than the collective bargaining agreement. As we concluded above, the complaint expressly alleges a violation of the collective bargaining agreement. Indeed, it appears that plaintiff’s claim for unlawful discharge is based on alternate theories, one being a violation of the collective bargaining agreement, as to which there is federal jurisdiction, and the other being a violation of the settlement agreement, as to which there is no independent basis for jurisdiction. The inclusion of an alternate theory cannot deprive the federal court of its statutory jurisdiction to decide a claim properly brought, as long as that claim is not on its face incidental, insubstantial or frivolous.
OBL also argues that determination of the claim based on the collective bargaining agreement will require an interpretation of the effect of the retroactive seniority provision of the settlement agreement. If Davis prevails on his contention that the proper cause provision of the collective bargaining agreement applied to all employees, there would be no need to refer to the settlement agreement. Only if he is unsuccessful on that claim would the court have to consider his secondary position under the collective bargaining agreement, i.e., that, in any event, the retroactive seniority awarded him under the settlement agreement raised him to the status of a non-probationary employee for purposes of the proper cause provision of the collective bargaining agreement. The mere fact that for that purpose reference to a document other than the collective bargaining agreement would be required does not dilute the essence of Davis’ claim that he was discharged by OBL in violation of the proper cause provision of the collective bargaining contract. Cf. Wilkes-Barre Publishing Co. v. Newspaper Guild of Wilkes-Barre Local 120,
Since the district court has jurisdiction to consider plaintiff’s claim that his discharge was in violation of the collective bargaining agreement, it follows that the court can consider plaintiff’s alternate claim that the discharge was also in breach of the settlement agreement. The relationship between the agreements presents an archetypical situation for finding pendent jurisdiction under the test enunciated in United Mine Workers v. Gibbs,
Given our conclusion that the complaint alleged a breach of the collective bargaining contract under section 301, it follows that plaintiff’s claim against the Union for breach of its duty of fair representation in the handling of Davis’ grievance was also within the jurisdiction of the district court. See Vaca v. Sipes,
Whether the contract will support plaintiff’s interpretation of its terms and whether the evidence will support plaintiff’s contentions as to the Union’s actions is not presently before us. The district court dismissed the action for lack of subject matter jurisdiction under Rule 12(b)(1), not for failure to state a claim under Rule 12(b)(6). The issue of subject matter jurisdiction must be considered as separate from an evaluation of the merits as long as the
B.
Count Two
The district court dismissed Count Two of the complaint for the same reason given in dismissing Count One, i.e., that plaintiff’s claims are anchored upon the settlement agreement rather than the collective bargaining agreement. The court construed Count Two as attacking the arbitrator’s decision “on the basis that the arbitrator either ignored or improperly construed provisions of the ‘Settlement Agreement.’ ”
Count Two of the complaint was brought to vacate or modify the arbitrator’s award, and specifies that jurisdiction arises under section 301. The collective bargaining agreement provided for a grievance procedure culminating in binding arbitration, as set forth in paragraph 8 of the complaint. In paragraph 16, the complaint alleges that the collective bargaining agreement provides that the arbitrator is precluded from adding to, subtracting from, or modifying the terms of this agreement. Paragraph 17 alleges that the arbitrator held that plaintiff was a probationary employee with less than 90 days experience despite the express language of the plaintiff’s settlement agreement. Paragraph 18 then alleges that the award “is wholly void in that the arbitrator exceeded his powers in adding to or modifying the express language of the agreement and further failed to conform to the procedural requirements of the agreement regarding the time of the award.” Paragraph 19 alleges that “the arbitrator’s award fails to draw its essence from the agreements” (emphasis added). It alleges that the arbitrator ignored the express language of the settlement agreement with regard to retroactive seniority and that “there exists no express provision providing for discharge without cause.”
Defendants apparently concede that a suit to set aside an arbitration award entered pursuant to a collective bargaining agreement falls within federal jurisdiction under section 301 if it alleges that the award failed to draw its essence from the collective bargaining agreement or that the arbitrator exceeded his powers thereunder. See, e.g., Kane Gas Light & Heating Co. v. International Brotherhood of Firemen & Oilers Local 112,
The major thrust of plaintiff’s attack on the arbitration award is that there was no- basis in the collective bargaining agreement for the arbitrator’s decision that only non-probationary employees were entitled to be discharged for cause. It is plaintiff’s position that the arbitrator developed the concept that Davis was a probationary employee and hence dischargeable at will without any support in the language of the
As was the case in Count One, there are allegations in Count Two referring to the settlement agreement, such as the claim that the arbitrator’s award renders the settlement agreement a nullity and meaningless. Neither the Union nor the employer objected to the arbitrator’s reference to the settlement agreement, and the arbitrator held that it was necessary to interpret the collective bargaining agreement and the settlement agreement in tandem. Plaintiff claims that the settlement agreement, properly construed, gave him the status of a non-probationary employee for purposes of the collective bargaining agreement. The issue whether the arbitrator correctly interpreted the settlement agreement is not before us. It is apparent, however, from the express language of the arbitrator’s award that the Union and OBL stipulated that the threshold question before the arbitrator was “whether Mr. David A. Davis, at the time of his discharge from Ohio Barge Line, Inc., in January of 1981, was a ‘probationary’ employee as that quoted term is used in the collective bargaining agreement and in the testimony taken on September 8, 1981, in the within arbitration case” (emphasis added). Therefore, Count Two of the complaint, which is directed to the arbitrator’s power under the collective bargaining agreement, properly invoked federal jurisdiction under section 301.
Accordingly, we will also vacate the judgment dismissing Count II of the complaint and remand for further proceedings.
C.
Count Three
The district court, correctly anticipating our decision in Beam v. Sun Shipbuilding & Dry Dock Co.,
III.
For the foregoing reasons, we will vacate the district court order dismissing the complaint and will remand for further proceedings in accordance with this opinion.
Notes
. Because we are remanding to the district court, we take no position on the court’s ruling dismissing the claim based on the initial discharge.
Dissenting Opinion
dissenting.
I would affirm the judgment of the district court, dismissing for want of federal jurisdiction, essentially for the reasons set
Although I agree with Judge Cohill, I quickly admit that a very respectable case can be made for the opposite result, as the majority forcefully demonstrate. Of the four federal judges who have carefully examined this matter, two find federal jurisdiction, and two do not. By virtue of the assignment of competence in the judicial hierarchy, however, a total calculus does not control, and only the arithmetic in the court of appeals is conclusive.
What divides us here is not an earthshaking matter, and, in a phrase often used by Judge Wade H. McCree, Jr., when he served as Solicitor General, “the Republic will still stand” if federal jurisdiction is found to exist in this case. We are divided merely because of differing value judgments about whether this labor case belongs in federal court or in state court.
In resolving this issue, two important legal principles compete for our attention: (1) because federal courts are courts of limited jurisdiction, we must presume that state courts have jurisdiction absent a contrary showing, for “it would not simply be wrong but indeed would be an unconstitutional invasion of the powers reserved to the states if the federal courts were to entertain cases not within their jurisdiction;”
It is well established that § 301(a) is available to vindicate individual employee rights arising from a collective bargaining agreement.
The present case rests somewhere between the two poles, but I place it closer to the state court pole. I agree with Judge Cohill that the essence of the complaint is a claim of wrongful discharge in breach of a provision in Davis’ private settlement agreement (count one), and a request that the court vacate or modify the arbitrator’s award because the arbitrator either ignored or improperly construed provisions of that settlement agreement (count two). To be sure, the plaintiff averred a violation of the collective bargaining agreement, as more particularly set forth by the majority. But I do not think that surplusage in a complaint is sufficient to sustain federal jurisdiction. Averred facts—not asserted abstractions—control. To make a naked averment that diversity jurisdiction obtains when the pleaded facts show that the parties are from the same state will not invest the federal court with authority to hear the case. Similarly, to make a naked averment that a grievance comes under a collective bargaining agreement will not confer federal jurisdiction when the averred facts that describe the specific contours of the grievance do not purport to show a bargaining agreement violation.
Where the law gives no rule, the demand of the plaintiff must furnish one; but*558 where the law gives the rule, the legal cause of action, and not the plaintiff’s demand, must be regarded.
McNutt v. General Motors Acceptance Corp.,
Thus, to me the issue is not whether § 301(a) should be construed narrowly or broadly; rather, it is whether § 301(a) is in the case at all. I do not think it is. I recognize, of course, that a respectable school of thought believes that the federal courts should assume, or even reach out for, jurisdiction if a litigant incants a naked averment of our jurisdiction, irrespective of the absence of a federal interest in the pleaded factual underpinning of the claim. I have never subscribed to that theory in the past, nor do I do so here. Federal judges are the final arbiters of whether a case comes within our gigantic power and authority. But at all times we should heed the admonition of the Bard of Stratford-onAvon:
O, it is excellent To have a giant’s strength, but it is tyrannous To use it like a giant.4
. C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure § 3522, at 45 (1975) (citing cases).
. In Smith v. Evening News Association, the Court noted that
Textile Workers v. Lincoln Mills ... of course, has long since settled that § 301 has substantive content and that Congress has directed the courts to formulate and apply federal law to suits for violation of collective bargaining contracts. There is no constitutional difficulty and § 301 is not to be given a narrow reading.
. See cases collected in Smith v. Evening News Association,
. W. Shakespeare, Measure for Measure, II, ii, 107-08 (The Riverside Shakespeare 309 (Houghton-Mifflin Co. 1974)).
