brought by service employees against their employer seeking damages for lost wages and fringe benefits" that they claimed were owed under the SCA. Id. at 906. The court, while recognizing that plaintiffs had fashioned their case as a diversity action, found that the gravamen of their complaint was that plaintiffs "were not paid by the defendant in accordance with the schedules promulgated under" the SCA. Id. Stripped to its core, that is precisely what the complaint in the instant case alleges. As the Foster court concluded, while such a complaint "may serve as the basis for administrative proceedings by the Secretary of Labor," it cannot enable plaintiffs to bypass such proceedings and seek relief in federal court. Id. at 907.
Nor is the Court persuaded by plaintiffs' arguments that defendants are using the SCA to "immunize" themselves "from all other liability, whether it be tort, contract, or other statutory liability." Pl. UNC. Opp. at 10. Plaintiffs' reliance on Berry v. Andrews, 535 F. Supp. 1317, 1318 (M.D.Ala. 1982), is simply misplaced. In Berry, the court held that a plaintiff's claim for retaliatory discharge under the Fair Labor Standards Act ("FLSA") was not preempted by the SCA. The court agreed that "an employee's sole remedy under the SCA for underpaid wage and lost fringe benefits is the administrative channel created by Congress," but held that a "plaintiff is entitled to pursue private action for an alleged retaliatory discharge under the FLSA since Congress did not provide any administrative redress for retaliatory discharge or attempt to address a suitable remedy in the SCA." Id. at 1319. Thus, the very rationale of the Berry Court belies plaintiffs' arguments. Unlike the situation in Berry, here plaintiffs seek redress for underpaid wages and fringe benefits, claims that are clearly addressed by the SCA.
If RICO were applicable to plaintiffs' claims, then a federal jury would be forced to decide issues that Congress has clearly delegated to the expertise of DOL. For example, plaintiffs allege that DynCorp engaged in "schemes to deny the class members the minimum wage payments determined and required by the Secretary of Labor pursuant to the Service Contract Act." Complaint para. 17. Yet, the Secretary of Labor has not yet determined the minimum wages required under the SCA for DynCorp Contracts #2 and #3 because there has been no final wage determination. Although the Department has issued a wage determination, it is currently on appeal to the Deputy Secretary of Labor. Similarly, as plaintiffs themselves recognize, Complaint paras. 159-160, DOL has not made any final determinations with respect to B-O Contracts #1 and #2. Thus, plaintiffs would ask a jury to determine that defendants had underpaid their workers in violation of the SCA and that such underpayments constitute violations of RICO while DOL, charged with enforcing the SCA, has yet to determine the amount of underpayment, if any.
Finally, the relief that plaintiffs seek is that which is afforded by the SCA, only trebled. Plaintiffs seek the amount of back pay, wages and other benefits defendants would be compelled to pay as a result of alleged violations of the SCA. In order to award damages, the jury would in effect have to engage in a wage determination and retroactively reset any previous wage determinations established by DOL. Clearly, such wage determinations, which involve determining the prevailing wage in the private sector of a given locality for similar work, require the administrative expertise of DOL.
Adoption of plaintiffs' arguments would, in effect, allow a private right of action under the SCA with a treble damage remedy. Because the Court concludes that plaintiffs' RICO claims are inextricably intertwined with wage determinations under the SCA and that Congress intended to confine such claims to the administrative process, Counts I-IV of plaintiffs' complaint must be dismissed for failure to state a claim upon which relief can be granted.
With respect to plaintiffs' claim for common law fraud, Count V of the Complaint, the Court has discretion to hear this claim under the doctrine of pendent jurisdiction. See United Mine Workers v. Gibbs, 383 U.S. 715, 725, 16 L. Ed. 2d 218, 86 S. Ct. 1130 (1966). As the Supreme Court has held, however, "pendent jurisdiction is a doctrine of discretion, not of plaintiff's right . . . if the federal claims are dismissed before trial, even though not insubstantial in a jurisdictional sense, the state claims should be dismissed as well." Gibbs, supra at 726 (citations omitted). In the instant case, although defendants urge that plaintiffs' fraud claim should be preempted as well, the Court will instead decline to exercise its discretion to allow plaintiff's fraud claim to proceed under the doctrine of pendent jurisdiction. See e.g., Long Distance Services v. Telecommunications Corp., 692 F. Supp. 1402, 1406 (D.D.C. 1988). The parties will not suffer undue hardship by dismissing the case from federal court at this early stage in the proceedings. Accordingly, Count V of the complaint will be dismissed for lack of subject matter jurisdiction pursuant to Fed. R. Civ. P. 12(b)(1).
An appropriate order shall accompany this opinion.
ORDER -- August 28, 1990, Filed
Upon consideration of defendants' motions to dismiss, the opposition thereto, the arguments of counsel, the entire record herein, and in accordance with the Court's opinion of this date, it is hereby
ORDERED that defendants' motions to dismiss be and hereby are granted; and it is further
ORDERED that Counts I-IV of the complaint in the above-captioned case be and hereby are dismissed for failure to state a claim upon which relief can be granted pursuant to Fed. A. Civ. P. 12(b)(6); and it is further
ORDERED that Count V of the complaint in the above-captioned case be and hereby is dismissed without prejudice because the Court declines to exercise pendent jurisdiction over this common law based cause of action.