John RUTHERFORD, et al., Plaintiffs-Appellants, v. JUDGE & DOLPH LTD. n/k/a Judge & Dolph LLC, et al., Defendants-Appellees.
No. 09-3706.
United States Court of Appeals, Seventh Circuit.
Argued April 5, 2012. Decided Feb. 4, 2013.
707 F.3d 710
It is true that after the announcement that employment at the mill would continue past May 2, some mill employees certainly faced a difficult choice between leaving the mill to pursue the employment offers they had obtained in a small town or staying until the mill closed to collect severance. LeFebvre and Reddinger chose to accept new employment instead of continuing to work at the mill, an understandable decision. As relevant here, though, when they decided to stop working on May 2, they could not have reasonably believed that they would receive severance. See McLellan, 758 N.W.2d at 109 (rejecting promissory estoppel argument where plaintiff could not reasonably believe he had valid offer in light of written agreement to the contrary); Dunn v. Milwaukee Cnty., 279 Wis. 2d 370, 693 N.W.2d 82, 89 (Wis.Ct.App.2005) (declining to grant equitable relief of promissory estoppel for plaintiffs’ actions in 2003 where promise had been withdrawn in 2002). In these circumstances the promissory estoppel claim cannot succeed. To the extent the plaintiffs are still pursuing an ERISA estoppel claim, it similarly fails for lack of reasonable reliance. See Kannapien v. Quaker Oats Co., 507 F.3d 629, 636 (7th Cir.2007).
III. CONCLUSION
The judgment of the district court is AFFIRMED.
Michael T. Smith (argued), Attorney, Roselle, IL, for Plaintiffs-Appellants.
Before ROVNER, WOOD, and WILLIAMS, Circuit Judges.
WILLIAMS, Circuit Judge.
In this suit brought under Section 301 of the Labor-Management Relations Act,
But we lack jurisdiction over the employees’ claim against Local 705. “Hybrid” claims for violations of a collective bargaining agreement pursuant to
I. BACKGROUND
Plaintiffs, eight members in good standing with Teamsters Local Union 705 (“Local 705“), were employed as truck drivers with Judge & Dolph Ltd. n/k/a Judge & Dolph LLC (“J & D“). J & D entered into a collective bargaining agreement (“CBA“) with Local 705 and its parent organization, the International Brotherhood of Teamsters. Among other things, the CBA set specific wages, provided for the deduction of union dues from paychecks, and prohibited J & D from firing employees without “just cause.” In addition, Article 18 generally required that any grievance “regarding the application, meaning or interpretation of this Agreement” be subject to arbitration. And importantly, Article 23 included an evergreen clause which provided: “This Agreement shall be in full force and effect from April 1, 2003 to and including March 31, 2007 and shall continue from year to year thereafter unless written notice of desire to cancel or terminate the Agreement is served by either party upon the other at least sixty (60) days prior to date of expiration.”
On November 16, 2006 (before 60 days prior to March 31, 2007), Local 705 served a notice which provided:
Pursuant to the provision of the current, April 1, 2003 through March 31, 2007 Collective Bargaining agreement (CBA) Article 23, Sections 1 and 2 between Judge & Dolph, LTD, and the Union,
please accept this letter as official notice to both terminate and negotiate modifications. In order to clarify the Union‘s bargaining position, relative to successor contract negotiations, it is the Union‘s desire to negotiate modifications to the current CBA, but Local 705 does not desire to continue or extend the current CBA beyond its expiration date of March 31, 2007.
J & D and Local 705 began negotiating a new CBA, and continued negotiations through the March 31, 2007 expiration date. J & D also continued paying the union wages required under the old CBA and deducting union dues after that date. Negotiations ended in August 2008, and no new CBA was signed.
Meanwhile, in June and July 2008, Plaintiffs were each terminated without “just cause“—for example, for refusing to sign new at-will employment agreements, among other reasons—in alleged violation of the CBA. J & D, howеver, refused to participate in arbitration concerning these alleged violations because it considered the CBA to have expired. Plaintiffs then asked Local 705 to bring unfair labor practices charges based on these alleged violations before the National Labor Relations Board (“NLRB“) on their behalf, which it did. Around April 2009, however, Local 705 and J & D agrеed to a settlement, which would give Plaintiffs about 25% of their claimed damages ($104,000 out of $409,709 total). But Plaintiffs refused to consent to the settlement, and Local 705 did not continue pursuing the NLRB action. And the parties seem to have assumed that Plaintiffs could not litigate their claims before the NLRB on their own without Local 705.
Plaintiffs filed suit in federal district court under Section 301 of the Labor-Managеment Relations Act (“LMRA“),
II. ANALYSIS
A. The Motions to Dismiss Should Have Been Converted into Motions for Summary Judgment Pursuant to Rule 12(d)
We first address the proper posture of this case.
Nоnetheless, in this case that is not cause for reversal or remand. Appellants were the ones who first submitted evidence outside the pleadings (J & D did initially submit a copy of the CBA, but that was the cornerstone of Appellants’ complaint and may be considered part of the pleadings, see 188 LLC, 300 F.3d at 735). J & D and Local 705 discuss this confused procedural posture in their briefs, and Apрellants have not suggested that they would have been, or would be, prejudiced by consideration of these motions as motions for summary judgment. We therefore treat this appeal as if the motions had been converted into motions for summary judgment, because we too rely on evidence submitted outside the pleadings, and because we do not reach the adequacy-of-pleading issue for reasons discussed below. Cf. Fleischfresser v. Dirs. of Sch. Dist. 200, 15 F.3d 680, 684-85 (7th Cir.1994) (district court decision to treat motion to dismiss as motion for summary judgment is not reversible error if there is no prejudice).
B. We Lack Jurisdiction to Consider Appellants’ Claim Against Local 705 Because It Is Not a “Hybrid” Claim Under Section 301
Appellants’ claims against Local 705 must be dismissed for lack of jurisdiction.1 Section 301 of the LMRA provides for federal subject-matter jurisdiction “without respect to the amount in controversy or without regard to the citizenship of the parties,” but only over “[s]uits for violation of contracts between an employer and a labor organization....”
In Vaca v. Sipes, 386 U.S. 171, 87 S.Ct. 903, 17 L.Ed.2d 842 (1967), however, the Supreme Court recognized a narrow exceрtion to the statute‘s jurisdictional bar. Acknowledging that the statute permits suits by employees against employers for CBA violations, it recognized that as a practical matter, an employee often cannot go straight to federal court with such a claim because many CBAs (like the one in this case) have mandatory provisions that require the employee, represented by his union, to pursue his grievances through arbitration. As the Supreme Court explained, if the union then decides, for whatever reason, not to arbitrate on behalf of the employee pursuant to the mandatory arbitration clause, only then may the employee allege a CBA violation in federal court. In doing so however, the employee may—indeed must—sue not only the employer for violating the CBA, but also the union for violating its duty of fair repre-
Appellants’ claim against Local 705 does not, however, fit into this narrow hybrid exception to the strict jurisdictional bar of Section 301. In Vaca, union-initiated arbitration was the employee‘s only avenue of relief because the CBA required it, whereas here, a union-initiated NLRB action was not the only avenue of rеlief because the CBA in this case did not require it. Nor is there a statutory obligation to exhaust NLRB remedies for this kind of claim—indeed, as we have recently explained, to the extent that a violation of the CBA can also be considered an unfair labor practice, the NLRB and the federal courts actually have concurrent jurisdiction over such claims. See Copeland, 675 F.3d at 1044 (citing Smith v. Evening News Assoc., 371 U.S. 195, 83 S.Ct. 267, 9 L.Ed.2d 246 (1962)). So the very reason for Vaca‘s creation of the hybrid exception does not exist here. Furthermore, we have explicitly recognized that when, as here, the employer refuses to arbitrate pursuant to a mandatory arbitration provision, the only obstacle to going directly to federal court has been removed. See McLeod v. Arrow Marine Transp., Inc., 258 F.3d 608, 616 (7th Cir.2001) (“Generally, an employee must exhaust the CBA‘s grievance procedures before pursuing judicial remedies; however, an employee may be excused from doing so if: (1) resorting to the grievance procedure would be futile; (2) the employer through its conduct repudiated the grievance procedure itself; or (3) the union breached its duty of fair representation.” (emphasis added)); see also Vaca, 386 U.S. at 185 (“An obvious situation in which the employee should not be limited to the exclusive remedial procedures established by the contract occurs when the conduct of the employer amounts to a repudiation of those contractual procedures.“); Roman v. U.S. Postal Serv., 821 F.2d 382, 388 (7th Cir.1987) (“The Supreme Court has held that an employee may be excused from
Section 301 only provides jurisdiction over “[s]uits for violation of contracts between an employer and a labor organization,” and because it was unnecessary for the employees to ask the union to bring an NLRB action once the employer repudiated the mandatory arbitration provision, it is also unnecessary—and therefore, impermissible jurisdictionally—for us to resolve whether or not Local 705 actеd improperly when it settled the NLRB proceeding. The claim against Local 705 simply is not part of a legitimate Section 301 “hybrid” claim, and so we dismiss the claim against Local 705 for lack of jurisdiction and do not reach whether the district court correctly found that the claim was inadequately pled. See Copeland, 675 F.3d at 1044 (dismissing unfair labor practice claim against union for lack of jurisdiсtion since it was not really part of a Section 301 hybrid). In other words, Appellants’ federal lawsuit—now consisting of a straightforward breach of CBA claim against the employer—turned out to be more complicated than it needed to be.
C. Because Local 705 Provided Notice to Terminate, J & D Did Not Breach the CBA
We turn next to Appellants’ claim against J & D for violating the CBA and readily conclude that it fails on the merits.
The evergreen clause in Article 23 of the CBA expressly provided that thе CBA would continue after March 31, 2007 “unless written notice of desire to cancel or terminate the Agreement is served by either party upon the other at least sixty (60) days prior to date of expiration.” On November 16, 2006—well before 60 days prior to the expiration date of March 31, 2007—Local 705 served a notice which explicitly provided that it was a “notice to terminаte,” and that “Local 705 does not desire to continue or extend the current CBA beyond its expiration date of March 31, 2007.” We cannot imagine a “notice of desire to cancel or terminate the Agreement” that is any more clear. Because the terms of the notice were unambiguous, it is unnecessary to turn to parol evidence, such as the fact that J & D сontinued deducting union dues or continued paying union wages.2
The two cases to which the employees devote most of their attention, OPEIU v. Wood Cnty. Telephone Co., 408 F.3d 314 (7th Cir.2005) and Baker v. Fleet Maintenance, Inc., 409 F.2d 551 (7th Cir.1969), involved essentially identical evergreen clauses to the one in this case but are easily distinguishable. In Wood County, the union served notice of a “desire to reopen this Agreement and to negotiate on wages, hours and conditions of еmployment for a successor agreement,” and did not include the word “terminate” or any similar such word. Observing that “‘reopen’ and ‘terminate’ are different ideas as well as different words,” Wood Cnty., 408 F.3d at 315, we found that this was not a notice to terminate. See id. at 315-17.
In Baker, thе union served notice of a desire to negotiate a “new contract wage agreement ... modifying the current contract wage agreement ..., which terminates March 31, 1967.” We said that the word “terminates” was ambiguous in this context because the word “could have been read to emphasize the word ‘modify,‘” Wood Cnty., 408 F.3d at 316 (discussing Baker), instead of an expression of an intent to terminate. Id. Here, however, the word “terminates” was not used in such a passive voice; it was clear that the union actively sought to terminate the CBA.
We lastly reject Appellants’ request for leave to amend their complaint. They never moved for leave to amend the latest complaint before the district court or filed a
III. CONCLUSION
For the above-stated reasons, we AFFIRM the judgment of the district court.