Opinion
Case No. 6:20-cv-01049-MK
01-06-2021
TOREY JARRETT, an individual, Plaintiff, v. MARION COUNTY, a political subdivision of the State of Oregon; SERVICE EMPLOYEES INTERNATIONAL UNION LOCAL 503, a labor organization; and MARION COUNTY EMPLOYEES ASSOCIATION LOCAL 294, a labor organization, Defendants.
FINDINGS AND RECOMMENDATION
KASUBHAI, United States Magistrate Judge:
Defendants Service Employees International Union Local 503 ("SEIU 503"), Marion County ("Marion County"), and Marion County Employees Association Local 294 (collectively "Defendants") move to dismiss Plaintiff Torey Jarrett's ("Plaintiff") complaint pursuant to Fed. R. Civ. P. 12(b)(1) and Fed. R. Civ. P. 12(b)(6). See Def.'s Mot. Dismiss, ECF No. 13. For the reasons set forth below, Defendants' motion to dismiss should be GRANTED.
BACKGROUND
At all relevant times, Plaintiff was employed by Marion County as a care coordinator and, by extension, was in a bargaining unit represented by SEIU 503. See Comp. ¶ ¶ 8, 9, ECF No. 1. Under Oregon law, union membership is voluntary. Dale v. Kulongoski, 321 Or. 108, 113-14, 894 P.3d 462 (1995). Pursuant to the Oregon Public Employees Collective Bargaining Act ("CBA"), unions and public employers are prohibited from coercing a public employee to become a union member. See, e.g., Or. Rev. Stat. ("ORS") §§ 243.662, 243.672. Public employees, however, may voluntarily authorize dues deductions for their unions. ORS § 243.806(1). Where such authorization exists, the union can request the state deduct union dues directly from the public employee's pay. ORS § 243.806(2). The applicable collective bargaining agreement requires Marion County to deduct payments for SEIU 503 and its affiliates from the wages of public employees. Comp. ¶ 9.
This statute became effective January 1, 2020. The parties agree that the statutory scheme previously in place, ORS §§ 243.776 and 292.055(3), provided analogous procedures and protections. See, e.g., Def.'s Reply to Mot. Dismiss at 3, ECF No. 27; Comp. at 3. ECF No. 1.
Since 2017, Plaintiff has not actively elected to be a union member. Id. at ¶ ¶ 1, 32. In March 2018, SEIU 503 representatives came to Plaintiff's home and brought literature for her to review. Id. at ¶ ¶ 12, 13. In March 2020, Plaintiff sent a letter to SEIU 503, objecting to union membership and payment of union dues and fees. Id. at ¶ 17. SEIU 503 responded, indicating that while Plaintiff could resign union membership, SEIU could still receive union dues until January 2021, pursuant to a membership card Plaintiff allegedly signed. Id. at ¶ 18. Plaintiff alleges she did not sign any membership card and sought counsel to notify SEIU 503 of the alleged forgery. Id. at ¶¶ 20, 21. In response to Plaintiff's allegations, "the SEIU 503 membership department notified Plaintiff's employing agency to terminate further union dues deductions from her pay," such that "[n]o union dues have been deducted from Plaintiff's pay since June 9, 2020." See Johnson Decl. ¶ 9, ECF No. 13.
On June 30, 2020, Plaintiff filed a complaint in this Court alleging the following claims: (1) deprivation of First Amendment rights in violation of 42 U.S.C. § 1983 against all Defendants; (2) deprivation of Fourteenth Amendment rights in violation of 42 U.S.C. § 1983 against all Defendants; (3) common law fraud against SEIU 503; and (4) violation of ORS § 652.615 against Marion County. Id. ¶¶ 34-59. Plaintiff seeks the following forms of relief: (1) declaratory judgement enjoining Defendants from "maintaining and enforcing any of the policies, provisions, or actions declared unconstitutional or illegal including the deduction of union dues or fees from Plaintiff's wages"; (2) attorney fees; and (3) nominal, compensatory, actual, and punitive damages. Id. at 10-11.
ORS § 652.615 ("Remedy for violation of ORS 652.610 states "[t]here is hereby created a private cause of action for a violation of ORS 652.610 (Itemized statement of amounts and purposes of deductions) (3) for actual damages or $200, whichever is greater. In any such action the court may award to the prevailing party, in addition to costs and disbursements, reasonable attorney fees."
STANDARD OF REVIEW
Where the court lacks subject matter jurisdiction, the action must be dismissed. Fed. R. Civ. P. 12(b)(1). The party who seeks to invoke the subject matter jurisdiction of the court bears the burden of establishing that such jurisdiction exists. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992). The court may hear evidence regarding subject matter jurisdiction and resolve factual disputes where necessary. Kingman Reef Atoll Invs., LLC v. United States, 541 F.3d 1189, 1195 (9th Cir. 2008).
Similarly, where the plaintiff "fails to state a claim upon which relief can be granted," the action must be dismissed. Fed. R. Civ. P. 12(b)(6). To survive a motion to dismiss, the complaint must allege "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). For purposes of a motion to dismiss, the complaint is liberally construed in favor of the plaintiff and its allegations are taken as true. Rosen v. Walters, 719 F.2d 1422, 1424 (9th Cir. 1983). Bare assertions, however, that amount to nothing more than a "formulaic recitation of the elements" of a claim "are conclusory and not entitled to be assumed true." Ashcroft v. Iqbal, 556 U.S. 662, 681 (2009). Rather, to state a plausible claim for relief, the complaint "must contain sufficient allegations of underlying facts" to support its legal conclusions. Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011).
DISCUSSION
Defendants assert dismissal is warranted in regard to Plaintiff's 42 U.S.C. § 1983 claims because "a private party's conduct that is illegal under state law, and that takes place without the knowledge of state officials, is not 'state action.'" See Def.'s Mot. Dismiss at 2, ECF No. 13. Defendants further contend that any request for prospective relief "does not present a live case or controversy because plaintiff's dues deductions have terminated." Id. at 4. Finally, Defendants argue that federal jurisdiction is lacking, and the Court should decline to exercise supplemental jurisdiction over Plaintiff's remaining state law claims, which are "foreclosed by ORS 243.806(10)(a)." Id.
ORS 243.806(10)(a) states "If a dispute arises between the public employee and the labor organization regarding the existence, validity or revocation of an authorization for the deductions and payment described under subsections (1) and (2) of this section, the dispute shall be resolved through an unfair labor practice proceeding under ORS 243.672 (Unfair labor practices)."
I. Failure to State a Claim
To state a claim under 42 U.S.C. § 1983, Plaintiff must show that Defendants deprived her of a right secured by the Constitution and acted "under color of state law." Naffe v. Frey, 789 F.3d 1030, 1036 (9th Cir. 2015) (citation omitted). Plaintiff argues Defendants are state actors because SEIU 503 uses state authority to direct Marion County's deduction of money from public employees' wages. See Comp. at ¶¶ 34-43, ECF No. 1; see also Pl.'s Resp. to Def.'s Mot. Dismiss at 6-16, ECF No. 26. Plaintiff's argument, however, is foreclosed by the Ninth Circuit's recent decision in Belgau v. Inslee, No. 19-35137, 2020 WL 5541390 (9th Cir. Sept. 16, 2020).
In Belgau, the plaintiffs worked as public-sector employees who allegedly signed union membership agreements authorizing Washington State to deduct dues from their wages and pay them to the Washington Federation of State Employees, AFSCME Council 28 ("WFSE"). Belgau, 2020 WL 5541390, at *2. After the Supreme Court held in Janus v. Am. Fed'n of State, Cty., & Mun. Employees, Council 31, 138 S. Ct. 2448 (2018), that compelling nonmembers to subsidize union speech violated the First Amendment, the plaintiffs notified WFSE that they no longer wanted to be union members or pay dues. Id. at *3. WFSE thereafter terminated the plaintiffs' union memberships but nevertheless continued to deduct union dues from their pay until an irrevocable one-year term expired. Id. The plaintiffs brought a putative class action against Washington Governor Jay Inslee, several state agency directors, and WFSE, alleging that the dues deductions violated their First Amendment rights and unjustly enriched WFSE. Id. The plaintiffs sought injunctive relief against Washington for the continued deduction of union dues and compensatory and other relief against WFSE. Id.
The Ninth Circuit held the plaintiffs' 42 U.S.C. § 1983 claims against the union failed for lack of state action. Id. at *3-6. The court set out a two-part analysis to determine whether WFSE's conduct was fairly attributable to the state, asking: (1) "whether the claimed constitutional deprivation resulted from the exercise of some right or privilege created by the State or by a rule of conduct imposed by the state or by a person for whom the State is responsible"; and (2) "whether the party charged with the deprivation could be described in all fairness as a state actor." Id. at *4 (citation and quotations omitted).
Plaintiff argues this case differs from Belgau because "Plaintiff's harm did not originate with a so-called 'private agreement.'" See Belgau, 975 F.3d at 940; see also Pl.'s Resp. to Def.'s Mot. Dismiss at 7, ECF No. 26. Plaintiff continues that because "Plaintiff did not see, review or sign a membership card before she was illegally forced to pay union dues. . . the harm began and ended with SEIU's unbridled authority." Id. The Court notes, however, that the harm alleged by Plaintiff is centered around the forgery of Plaintiff's signature on a membership card which authorized Defendants to continue collecting dues, and the harm ended after Defendants were notified about alleged forgery. See, e.g., Comp. ¶¶ 17, 22. Thus, as in Belgau, the source of the alleged constitutional harm is not a State statute or policy but the particular private agreement between SEIU 503 and Plaintiff. SEIU 503's "private misuse of a state statute does not describe conduct that can be attributed to the State[.]" Lugar v. Edmondson Oil Co., 457 U.S. 922, 941 (1982); see also ORS § 292.055 (repealed Jan. 1, 2020) (permitting union dues deductions only when authorized by the state employee). Plaintiff's 42 U.S.C. § 1983 claims fail the first prong of the state action test.
Nor can Plaintiff prevail at the second step—"whether the party charged with the deprivation could be described in all fairness as a state actor." Belgau, 975 F.3d at 947. As a private party, SEIU 503 is generally not bound by the First Amendment. See United Steelworkers of Am., AFL-CIO-CLC v. Sadlowski, 457 U.S. 102, 102 S. Ct. 2339, 72 L. Ed. 2d 707 (1982) (unless [the labor union] has acted "in concert" with the state "in effecting a particular deprivation of constitutional right"). A joint action between a state and a private party may be found in two scenarios: the government either (1) "affirms, authorizes, encourages, or facilitates unconstitutional conduct through its involvement with a private party," or (2) "otherwise has so far insinuated itself into a position of interdependence with the non-governmental party," that it is "recognized as a joint participant in the challenged activity." Naoko Ohno v. Yuko Yasuma, 723 F.3d 984, 993 (9th Cir. 2013). Although Marion County was required to enforce the membership agreement by state law, Plaintiff alleges no facts that indicate Marion County shaped the terms of the membership agreement. Marion County "cannot be said to provide 'significant assistance' to the underlying acts that Plaintiff contends constituted the core violation of its First Amendment rights" if the "law requires" Marion County to enforce the decisions of others "without inquiry into the merits" of the agreement. Ohno, 723 F.3d at 996-97. Marion County's "mandatory indifference to the underlying merits" of the authorization "refutes any characterization" of SEIU 503 as a joint actor with Marion County. Id. at 997. Neither scenario exists here.
II. Subject Matter Jurisdiction
Defendants move to dismiss Plaintiff's claims for declaratory and injunctive relief as moot. See Def.'s Mot. Dismiss at 25-27, ECF No. 13. Federal courts are courts of limited jurisdiction, such that, in order to proceed in this forum, Plaintiff's claims must present an active case or controversy. Lujan v. Defenders of Wildlife, 504 U.S. at 560-61 (1992) (citations and internal quotations omitted). To meet this requirement, "throughout the litigation, the plaintiff must have suffered, or be threatened with, an actual injury traceable to the defendant and likely to be redressed by a favorable judicial decision." Spencer v. Kemna, 523 U.S. 1, 7 (1998) (citation and quotations omitted); see also Summers v. Earth Island Inst., 555 U.S. 488, 493 (2009) (in order to be redressable, the injury in fact must be both "actual and imminent") (citation omitted). An "action is mooted when the issues presented are no longer live and the parties lack a legally cognizable interest for which the courts can grant a remedy." Alaska Ctr. for Env't v. U.S. Forest Serv., 189 F.3d 851, 854 (9th Cir. 1999). In particular, claims for equitable relief are moot "if subsequent events made it absolutely clear that the allegedly wrongful behavior could not reasonably be expected to recur." Rosebrock v. Mathis, 745 F.3d 963, 971 (9th Cir. 2014) (citation and internal quotations omitted); see also Alaska Ctr. for Env't, 189 F.3d at 854-55 (narrow "capable of repetition yet evading review" exception applies only if, amongst other criteria, "there is a reasonable expectation that the plaintiffs will be subjected to [the challenged conduct] again").
Here, Plaintiff's claims do not present an active case or controversy. It is undisputed that union dues are no longer being deducted from Plaintiff's wages. See Johnson Decl. at ¶¶ 9-11, ECF No. 13; see also Comp. at ¶¶ 22-23, ECF No. 1. While Defendants have voluntarily ceased the challenged activity, Plaintiff's claims are not moot if there is "a 'reasonable expectation" or a 'demonstrated probability' that the same controversy will recur involving the same complaining party." Murphy v. Hunt, 455 U.S. 478, 482 (1982) (emphasis added). Plaintiff, however, cannot make this showing.
The complaint does not allege any facts suggesting the unlawful deduction of dues will occur again or that the State itself was involved in any wrongdoing. See Comp. at ¶¶ 11-28, ECF No. 1. Plaintiff concedes "it may be correct that 'there is no plausible claim that Oregon or the County condones the forgery.'" See Pl.'s Resp. to Def.'s Mot. Dismiss at 5, ECF No. 26. Plaintiff's contention is that the possibility exists for Defendants to obtain union dues without her consent because the underlying statutory scheme does not require Marion County to independently verify her authorization. Id. at 27-31. The Court notes, however, that there "already exists a statutory scheme to ensure that union dues do not get deducted from a public employee's wages absent his or her authorization, with procedures for the public employee to recoup those wages should unauthorized deductions occur." See Schiewe v. Serv. Employees Int'l Union Local 503, No. 3:20-CV-00519-JR, 2020 WL 4251801, at *3 (D. Or. July 23, 2020), adopted, WL 5790389 (D. Or. Sept. 28, 2020).
Plaintiff argues that these statutes themselves are unconstitutional. Pl.'s Resp. to Def.'s Mot. Dismiss at 3-4, ECF No. 26. Yet the deduction of dues pursuant to a valid authorization agreement does not infringe on a public employee's First Amendment rights. See Fisk v. Inslee, 759 Fed. Appx. 632, 633 (9th Cir. 2019) ("[t]he First Amendment does not preclude the enforcement of 'legal obligations' that are bargained-for and 'self-imposed' under state contract law") (citing Cohen v. Cowles Media, 501 U.S. 663, 668-71 (1991)). Furthermore, forging an employee's membership agreement or otherwise authorizing the unauthorized payment of union dues violates ORS § 243.806 and other provisions of Oregon law. As such, the allegedly wrongful conduct at issue in this case is neither permitted nor caused by the State's statutory scheme surrounding unions. See, e.g., Yates v. Wash. Fed'n of State Empls., 2020 WL 3118496, *1-4 (W.D. Wash. June 12, 2020).
Plaintiff's expectation of repeated unlawful dues deductions is neither reasonable nor probable given Defendants' representations. See Johnson Dec. ¶ 10, ECF No. 13 ("[i]n light of Plaintiff's claim that unauthorized deductions were made from her pay, the SEIU 503 membership department has been instructed to flag Plaintiff's name in its databases so that any future membership application in Plaintiff's name will be brought to the attention of SEIU's legal department for review"); see also Pub. Util. Comm'n of Cal. v. Fed. Energy Regulatory Comm'n, 100 F.3d 1451, 1460 (9th Cir. 1996) ("[w]hen resolution of a controversy depends on facts that are unique or unlikely to be repeated, the action is not capable of repetition and hence is moot") (citation omitted). As such, "no union dues could be deducted from [Plaintiff]'s pay in the future unless she voluntarily authorizes the deductions." See Johnson Dec. at ¶ 9, ECF No. 13.
Under analogous circumstances, courts within the Ninth Circuit have repeatedly found that subject matter jurisdiction is lacking once the plaintiff is no longer a union member and dues are no longer being deducted. See, e.g., Stroeder v. Serv. Emps. Int'l Union, 2019 WL 6719481, *3 (D. Or. Dec. 6, 2019); Seager v. United Teachers L.A., 2019 WL 3822001, *2 (C.D. Cal. Aug. 14, 2019); see also Babb v. Cal. Teachers Ass'n, 378 F.Supp.3d 857, 886 (C.D. Cal. 2019) (dismissing the plaintiff's claim as moot because he "would have to rejoin his union for his claim to be live, which, given his representations in this lawsuit, seems a remote possibility"); Yates, 2020 WL 3118496 at *5 (dismissing the plaintiff's claim for lack of standing where she "presents no evidence to contradict [the union]'s showing that its procedures make unauthorized withdrawals [of dues] very unlikely . . . The fact that [she] encountered an isolated instance of misconduct or error in the past does not mean she is at heightened risk of another similar experience"); Ochoa, 2019 WL 4918748 at *3 (the fact "that [the plaintiff] is 'forced to exercise heightened vigilance' because 'SEIU 775 has dealt with [her] deceptively in the past' and she 'knows that the State Defendants will not, apparently, question any union representation from the union' [was] not a sufficient ongoing injury to establish a case and controversy"). Accordingly, Defendants' motion should be granted.
III. Supplemental Jurisdiction
Because Plaintiff's federal claims fail at the pleadings level, the Court must determine whether it should exercise supplemental jurisdiction over the common law fraud claim against Defendants despite the lack of complete diversity between the parties. A district court may decline to exercise supplemental jurisdiction over state-law claims if it "has dismissed all claims over which it has original jurisdiction." Ove v. Gwinn, 264 F.3d 817, 826 (9th Cir. 2001) (citing 28 U.S.C. § 1367(c)(3)). When a court dismisses all federal law claims before trial, "the balance of the factors to be considered under the pendent jurisdiction doctrine—judicial economy, convenience, fairness, and comity—will point toward declining to exercise jurisdiction over the remaining state-law claims." Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350 n. 7 (1988); accord Acri v. Varian Assocs., Inc., 114 F.3d 999, 1001 (9th Cir. 1997) (en banc); see also Crane v. Allen, No. 3:09-cv-1303-HZ, 2012 WL 602432, at *10 (D. Or. Feb. 22, 2012) ("Having resolved all claims over which it had original jurisdiction, this court declines to exercise supplemental jurisdiction over Plaintiffs' remaining state law claims.").
This case has not proceeded beyond the pleadings stage and few judicial resources have been used. Dismissal also promotes comity by allowing the Oregon courts to interpret matters of state law. As such, the balance of factors favors declining supplemental jurisdiction. See Carnegie-Mellon Univ., 484 U.S. at 350 ("When the federal-law claims have dropped out of the lawsuit in its early stages and only state-law claims remain, the federal court should decline the exercise of jurisdiction."). Plaintiff's remaining state law claims should be dismissed without prejudice.
RECOMMENDATION
For the reasons stated herein, Defendants' Motion to Dismiss (ECF No. 13) should be granted and this case should be dismissed with leave to refile in state court, and judgment should be entered accordingly. This recommendation is not an order that is immediately appealable to the Ninth Circuit Court of Appeals. Any notice of appeal pursuant to Rule 4(a)(1), Federal Rules of Appellate Procedure, should not be filed until entry of the district court's judgment or appealable order. The parties shall have fourteen (14) days from the date of service of a copy of this recommendation within which to file specific written objections with the court. Thereafter, the parties shall have fourteen (14) days within which to file a response to the objections. Failure to timely file objections to any factual determination of the Magistrate Judge will be considered as a waiver of a party's right to de novo consideration of the factual issues and will constitute a waiver of a party's right to appellate review of the findings of fact in an order or judgment entered pursuant to this recommendation. DATED this 6th day of January 2021.
s/ Mustafa T. Kasubhai
MUSTAFA T. KASUBHAI (He / Him)
United States Magistrate Judge