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Pacific Coast District, Marine Engineers' Beneficial Association, AFL-CIO v. American Maritime Officers

United States District Court, D. Columbia.

December 5, 2014


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[Copyrighted Material Omitted]

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For AMERICAN MARITIME OFFICERS, DANIEL SHEA, THOMAS BETHEL, Defendants: Michael J. Barta, LEAD ATTORNEY, Vernon Anthony Andrew Cassin, III, BAKER BOTTS LLP, Washington, DC.

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KETANJI BROWN JACKSON, United States District Judge.

Plaintiff District No. 1, Pacific Coast District, Marine Engineers' Beneficial Association, AFL-CIO (" MEBA" ) and Defendant American Maritime Officers (" AMO" ) are rival labor unions that represent maritime industry employees who are stationed at ports throughout the United States and on oceangoing vessels. Both MEBA and AMO are affiliated with the AFL-CIO; their dispute in the instant case arises out of a collective bargaining relationship that MEBA had with a third party, gone bad.

Specifically, until 2011, MEBA had a long-standing collective bargaining agreement with Liberty Maritime Corp. (" Liberty" ), a shipping management company that had employed MEBA-represented individuals aboard its tanker and bulk carrier vessels for more than twenty years pursuant to successive labor contracts. That relationship soured when labor negotiations between MEBA and Liberty that took place in the fall of 2011 failed to produce a successor contract for the first time since 1988. Liberty immediately entered into a new collective bargaining agreement with AMO; indeed, according to MEBA, Liberty and AMO had secretly and improperly met and bargained while the contract negotiations between Liberty and MEBA were still underway, and it was this secret meeting that caused the ongoing successor-contract negotiations to fail. To vindicate what MEBA contends was tortious conduct on AMO's part, MEBA filed the instant lawsuit against AMO in the Superior Court of the District of Columbia, claiming intentional interference with a prospective business advantage (Count I) and unjust enrichment (Count II). ( See Compl. for Intentional Interference with Prospective Bus. Advantage & Unjust Enrichment (" Compl." ), ECF No. 3-1, at 5-19, ¶ ¶ 3, 37-43.)[1] AMO then removed the case to federal court ( see Defs.' Notice of Removal, ECF No. 1, ¶ ¶ 7-9), contending that section 301 of the Labor Management Relations Act (" LMRA" ), 29 U.S.C. § 185, preempts MEBA's common law claims insofar as resolution of MEBA's claims requires interpretation of certain labor agreements under federal law ( see Notice of Removal, ¶ ¶ 7-9).

Before this Court at present are two motions: (1) MEBA's motion to remand this matter to Superior Court (Pl.'s Mot. to Remand & Opp'n to Defs.' Mot. to Dismiss (" Pl.'s Mot." ), ECF No. 7), and (2) AMO's motion to dismiss MEBA's complaint (Defs.' Mot. to Dismiss (" Defs.' Mot." ), ECF No. 4). With respect to remand, MEBA maintains that there is no federal question jurisdiction--and, thus, that removal was improper--because a state court could resolve MEBA's common law claims without analyzing or interpreting any labor contracts. ( See Pl.'s Mem. in Supp. of Pl.'s Mot. (" Pl.'s Br." ), ECF No. 7-1, at 1-3.) AMO responds that resolution of MEBA's common law claims requires interpreting both the AFL-CIO constitution and MEBA's collective bargaining agreement with Liberty in a manner that triggers section 301's preemptive

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effect and bestows federal question jurisdiction upon this Court. ( See Notice of Removal ¶ 9; Defs.' Opp'n to Pl.'s Mot. (" Defs.' Opp'n" ), ECF No. 9, at 1-3.) In addition, AMO maintains that MEBA's complaint must be dismissed, first, because the AFL-CIO constitution requires affiliates to engage in arbitration as the exclusive method of resolving inter-union disputes, and second, because MEBA's state law claims lack federal labor law analogues. (Defs.' Mem. in Supp. of Defs.' Mot. (" Defs.' Br." ), ECF No. 4-1, at 1-2.)

After consideration of the parties' briefs and the applicable law, this Court finds that this case was properly removed to federal court under 28 U.S.C. § 1441 because interpretation of the AFL-CIO constitution under federal labor law is required in order to address MEBA's common law claims. Furthermore, because MEBA has agreed to binding arbitration as the exclusive method of resolving inter-union disputes under the AFL-CIO constitution yet has failed to exhaust those procedures in this case, this Court concludes that MEBA cannot maintain the instant lawsuit. Consequently, MEBA's motion to remand is DENIED, and AMO's motion to dismiss MEBA's complaint, as converted to a motion for summary judgment herein, is GRANTED. A separate order consistent with this memorandum opinion will follow.


A. Factual Background

MEBA and AMO are labor organizations that represent licensed deck and engineering officers in the U.S. maritime industry. ( See Compl. ¶ ¶ 1-2; Notice of Removal ¶ 1.) Both unions are affiliated with the AFL-CIO. (Notice of Removal ¶ 1.) According to the complaint, Liberty has traditionally used MEBA-represented employees on its vessels pursuant to a series of collective bargaining agreements that began with Liberty's formation in 1988. (Compl. ¶ 7.) On August 25, 2010, MEBA entered into a Memorandum of Understanding (" MOU" ) with Liberty that extended the existing collective bargaining agreement (" CBA" ) for one year--until September 30, 2011--and that also provided for negotiations in the event that either party sought to amend the CBA. ( Id. ¶ ¶ 9-10.) In this regard, the MOU contained the following statement:

In the event either the Company or the Union serves notice to amend the Agreement, the terms of the Agreement in effect at that time of the notice to amend shall continue in effect until mutual agreement on the proposed amendments or an impasse has been reached.

( Id. ¶ 10.) MEBA alleges that it provided Liberty with timely notice of its desire to amend the agreement on July 8, 2011, and that, thereafter, MEBA and Liberty began negotiating the terms of a successor contract. ( Id. ¶ ¶ 11-13.)

It is undisputed that the subsequent negotiations between MEBA and Liberty focused on Liberty's request that MEBA transition from a " defined benefit plan" to a " defined contribution plan," and also various other operational issues that the parties referred to as the " 20 points." ( Id. ¶ ¶ 15-16.)[2] MEBA alleges that, while it

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was negotiating with Liberty over these terms, AMO's National President Thomas Bethel and Assistant Vice President Daniel Shea (referred to herein collectively with the union as " AMO" )--who were aware of the ongoing negotiations--attended a secret meeting with Liberty representatives. ( Id. ¶ 17, 19.) According to the complaint, during that meeting in August of 2011, Bethel and Shea made clear to Liberty that AMO would readily accept the terms that Liberty was demanding of MEBA--that is, the defined contribution plan and the 20 points. ( Id. ¶ ¶ 20-21.) MEBA further alleges that AMO and Liberty reached " an agreement in principal [sic]" at the close of the meeting to enter into a new collective bargaining agreement together ( id. ¶ 22), and that both AMO and Liberty concealed their meeting and agreement from MEBA ( id. ¶ 19 (" Neither Liberty nor AMO disclosed to the MEBA that they were meeting and negotiating for a CBA[.]" ); id. ¶ 24 (" [T]he AMO defendants and Liberty acted to conceal their meeting and agreement on a CBA." )). Moreover, according to the complaint, although Liberty resumed negotiations with MEBA after its meeting with AMO, Liberty thereafter " refused to alter its bargaining position with MEBA," and " took an 'all or nothing' approach that made it much more difficult for the parties to make progress in their negotiations." ( Id. ¶ 26.)

Eventually, MEBA realized that Liberty was not budging " and that the parties would not reach a successor agreement unless the Union reevaluated its position." ( Id. ¶ 28.) On September 28, 2011, with little time left to act before expiration of the MOU's September 30th extension period, MEBA purportedly informed Liberty that it would agree to both a defined contribution plan and Liberty's recent economic proposals, and requested that MEBA and Liberty return to the bargaining table to conclude negotiations on the 20 points and to finalize a successor agreement. ( Id. ¶ ¶ 29-30.) MEBA alleges that, in response, Liberty " stated that it was 'too late'" ( id. ¶ 31), and then refused to negotiate further ( id. ¶ 32). This refusal, according to MEBA, was based on the fact that Liberty had already " called AMO to confirm their agreement in principal [sic]" and had begun making plans for " AMO represented personnel to take the place of MEBA represented personnel" aboard Liberty's ships. ( Id. ¶ 33.) Consequently, MEBA alleges, when the clock struck midnight on October 1, 2011, AMO members began staffing Liberty's vessels, leaving MEBA members high and dry. ( Id. ¶ ¶ 35-36.)

B. Procedural History

On June 12, 2013, MEBA filed the instant two-count complaint against AMO in D.C. Superior Court. ( See id. at 5; Notice of Removal ¶ 1.) Count I alleges that AMO " intentionally interfered with" MEBA's contractual relationship with Liberty when it wrongfully induced Liberty to " breach its labor contract with MEBA" and to " end good faith bargaining between Liberty and MEBA" through improper " conduct, communications and contact" with Liberty, " including its August, 2011 meeting[.]" (Compl. ¶ 39.) Count II alleges that AMO has been unjustly enriched by " financial payments and other benefits" from Liberty because, absent AMO's interference, MEBA would have received those benefits. ( Id. ¶ 42.) Accordingly, MEBA's complaint--which

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sounds in tort law--seeks compensatory and punitive damages against AMO. ( Id. at 18, ¶ 5.)[3]

AMO removed this action to federal court on July 8, 2013, pursuant to 28 U.S.C. § 1441, arguing that, under section 301 of the LMRA, this Court has federal question jurisdiction over MEBA's asserted state common law claims. ( See Notice of Removal at 1-2 & ¶ ¶ 7-9.) One week later, on July 15, 2013, AMO moved to dismiss the complaint in its entirety pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). ( See Defs.' Mot. at 1.) Specifically, AMO argues that because both parties are AFL-CIO affiliates, the AFL-CIO constitution requires that AMO and MEBA resolve the instant dispute in a mandatory arbitration procedure, not in federal or state court. ( See Defs.' Br. at 14-17.) AMO also contends that the complaint fails to state a claim upon ...

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