Opinion
CIVIL NO. 1:02CV00959
January 22, 2003
MEMORANDUM OPINION
On October 8, 2002, Plaintiffs Star Kelly and Rick Kelly ("Plaintiffs") brought this action in the General Court of Justice, Superior Court Division, Rowan County, North Carolina, alleging violations of the Family Medical Leave Act ("FMLA"), interference/retaliation under the FMLA, and breach of contract. On November 7, 2002, Defendant Philip Morris, Inc. ("Defendant") removed this action pursuant to 28 U.S.C. § 1331, 1332, and 1441. This case is now before the court on Defendant's motion to dismiss and/or for partial summary judgment on Plaintiffs' third and sixth claims for relief. Defendant avers that Plaintiffs' breach of contract claims allege breach of a collective bargaining agreement and are, therefore, preempted by Section 301 of the Labor-Management Relations Act ("LMRA"), 29 U.S.C. § 185. Because Plaintiffs have not had notice or an opportunity to conduct discovery, the court will not consider matters outside the pleadings and will treat Defendant's motion only as one to dismiss under Federal Rule of Civil Procedure 12(b)(6).
FACTS
According to the complaint, Plaintiffs were employed by Defendant at Defendant's facility in Concord, North Carolina, pursuant to a "written labor contract." (Compl. at 7.) It is undisputed that each Plaintiff's "written labor contract" was a collective bargaining agreement between Defendant and Plaintiffs' union.
DISCUSSION
I. Motion to Dismiss Standard
The court may dismiss a complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) only if "it appears beyond a doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957). In considering a motion to dismiss, the court accepts as true all well-pleaded allegations and views the complaint in the light most favorable to the plaintiff. Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134 (4th Cir. 1993). "`The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims.'" Revene v. Charles County Comm'rs, 882 F.2d 870, 872 (4th Cir. 1989) (quoting Scheuer v. Rhodes, 416 U.S. 232, 236 (1974), abrogated on other grounds by Harlow v. Fitzgerald, 457 U.S. 800 (1982)).
II. Plaintiffs' Breach of Contract Claims are Preempted by Section 301
Plaintiffs' third and sixth claims for relief are based upon "breaches of the contract of employment between the Plaintiffs and defendant." (Compl. at 1.) Defendant claims that Plaintiffs' two breach of contract claims are preempted under Section 301 of the LMRA because the "contract of employment" alleged to be breached is a collective bargaining agreement. Section 301 provides federal courts with jurisdiction over disputes arising out of employment relationships governed by collective bargaining agreements and "authorizes federal courts to fashion a body of federal law for the enforcement of these collective bargaining agreements." Textile Workers v. Lincoln Mills, 353 U.S. 448, 451 (1957). Section 301 is afforded a broad preemptive effect over state law to ensure "that federal law will be the basis for interpreting collective-bargaining agreements." Lingle v. Norge Div. of Magic Chef. Inc., 486 U.S. 399, 409 (1988). The reasoning behind this is that uniform application of the law as to the interpretation of collective bargaining agreements is crucial to the continued vitality and use of these agreements. See Teamsters v. Lucas Flour Co., 369 U.S. 95, 103-04 (1962)
"[N]ot every dispute concerning employment, or tangentially involving a provision of a collective-bargaining agreement," however, "is pre-empted by § 301." Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 211 (1985). It was in Allis-Chalmers that the United States Supreme Court set the standard for Section 301 preemption of state law claims. The Court held that when resolution of state law claims "substantially depend[s] upon analysis of the terms of an agreement made between the parties in a labor contract," then the state law claims are preempted. Id. at 220; see also McCormick v. ATT Techs., Inc., 934 F.2d 531, 535 (4th Cir. 1991) (en banc) (where "resolution of the [state law] cause of action requires interpretation of a collective bargaining agreement," the claim is preempted)
Looking to the complaint, Plaintiffs' third claim of relief is entitled "Star Kelly's Breach of Contract Claim." (Compl. at 14.) Similarly, Plaintiffs' sixth claim of relief is entitled "Rick Kelly's Breach of Contract Claim." (Compl. at 19.) Plaintiffs allege that these breach of contract claims are not state claims but claims "seeking violations of the collective bargaining agreement for an issue that state courts have been explicitly given non-exclusive jurisdiction to rule on." (Pls' Resp. Br. to Def.'s Mot. Dismiss and/or Partial Summ. J. at 2.) After a review of the contents of those claims, however, the court does not find the claims to be anything other than state law claims for breach of contract. Regardless of how Plaintiffs may wish to characterize their claims, they clearly pled and intended to plead state law breach of contract claims in their complaint. See Davis v. Bell Atl.-W. Va., Inc., 110 F.3d 245, 247 (4th Cir. 1997) (holding that "[f]orm is not to triumph over substance as employees relabel contract claims")
While Plaintiffs admit that the breach of contract claims "relate" to violations of the collective bargaining agreement, they aver that their claims do not require this court to "interpret" the agreement. (Pls.' Resp. Br. to Def.'s Mot. Dismiss and/or Partial Summ. J. at 2-3.) Rather, they state that the claims require "interpreting and applying distinct state and federal FMLA jurisprudence." (Id.) Plaintiffs have admitted that the collective bargaining agreement is the labor agreement mentioned in their breach of contract claims in their complaint. Plaintiffs have also admitted that these claims are "seeking violations of the collective bargaining agreement." (Id. at 2.) In order for this court to render an opinion as to whether Defendant breached or violated the collective bargaining agreement, it will be necessary to examine, interpret, and understand the agreement itself. The Fourth Circuit has held that to the extent that a "breach of contract claim rests on the collective-bargaining agreement itself, § 301 of the LMRA clearly preempts the claim." Davis, 110 F.3d at 248.
Because Plaintiffs' state law breach of contract claims depend on this court examining and interpreting the relevant sections of the collective bargaining agreement, Plaintiffs' third and sixth claims for relief are preempted by Section 301.
III. Plaintiffs' Claims are not Section 301 Claims
Finding that Section 301 preempts these claims does not end the inquiry. When Section 301 preempts a claim, the claim must either be treated as a Section 301 claim or dismissed. See Allis-Chalmers, 471 U.S. at 220. Defendant claims that Plaintiffs' breach of contract claims are not Section 301 claims because Plaintiffs failed to allege that they have exhausted the grievance and arbitration remedies provided in the collective bargaining agreement. The general rule regarding exhaustion of contractual procedures is set forth in Republic Steel Corp. v. Maddox, 379 U.S. 650 (1965). In that case the United States Supreme Court determined that an employee must first attempt to utilize his or her grievance procedures before proceeding under Section 301. Id. at 658-59;see also Smith v. United Parcel Serv., Inc., 902 F. Supp. 719, 722 (S.D.W. Va. 1995) (collecting cases and holding in Section 301 context that plaintiffs must attempt to exhaust their remedies under the collective bargaining agreement before seeking judicial relief and must allege facts supporting exhaustion in their complaint); Binkley v. Loughran, 714 F. Supp. 776, 779-80 (M.D.N.C. 1989)
After reviewing the complaint it is clear that Plaintiffs have failed to plead a Section 301 claim. Plaintiffs fail to allege any facts showing that they have exhausted or even sought the grievance and arbitration remedies provided in the collective bargaining agreement. As a result, Plaintiffs' third and sixth claims for relief will be dismissed.
CONCLUSION
For the foregoing reasons, Plaintiffs' third and sixth claims for relief will be dismissed.
An order in accordance with this memorandum opinion shall be entered contemporaneously herewith.