District 5, United Mine Workers v. Weiss (In re Weiss)

129 B.R. 51, 1991 Bankr. LEXIS 915
CourtDistrict Court, W.D. Pennsylvania
DecidedJuly 9, 1991
DocketBankruptcy No. 89-2901-BM; Adv. Nos. 90-0459-BM, 91-0157-BM
StatusPublished
Cited by1 cases

This text of 129 B.R. 51 (District 5, United Mine Workers v. Weiss (In re Weiss)) is published on Counsel Stack Legal Research, covering District Court, W.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
District 5, United Mine Workers v. Weiss (In re Weiss), 129 B.R. 51, 1991 Bankr. LEXIS 915 (W.D. Pa. 1991).

Opinion

MEMORANDUM OPINION

BERNARD MARKOVITZ, Bankruptcy Judge.

Plaintiffs in the above-captioned adversary actions are the collective bargaining [53]*53agent for employees of Penn Hills Energy, Inc., and the local representative of those employees, respectively. Defendant is the debtor in the underlying bankruptcy case and also is the majority shareholder and President of Penn Hills Energy, Inc. (hereinafter “Penn Hills”).

Plaintiffs seek in Adversary No. 90-0459-BM to recover from debtor unpaid wages and other compensation owing to employees of Penn Hills pursuant to a collective bargaining agreement executed by debtor as President of Penn Hills Energy. According to plaintiffs, debtor qualifies as an employer under the Pennsylvania Wage Payment and Collection Law (hereinafter “WPCL”) and therefore is personally liable for the amounts due and owing.

Plaintiffs seek in Adversary No. 91-0157-BM to have the purported debt owed to them by debtor declared nondischargeable pursuant to 11 U.S.C. § 523(a) and to deny debtor a discharge pursuant to 11 U.S.C. § 727(a).

Defendant seeks to have both adversary actions dismissed. He argues that Adversary No. 90-0459-BM must be dismissed because plaintiffs’ cause of action under WPCL is pre-empted by federal law. He further argues that Adversary No. 91-0157-BM must be dismissed because plaintiffs are not his creditors and therefore lack standing to bring that action. Defendants deny that WPCL is pre-empted by federal law and deny that they lack standing.

Defendant’s motions will be granted. Both adversary actions will be dismissed with prejudice for reasons set forth below.

-I-

ADVERSARY NO. 90-0459-BM

Plaintiffs contend that debtor, as majority shareholder and President of Penn Hills, qualifies as an “employer” under 43 P.S. § 260.2(1) of WPCL and therefore is personally liable for all unpaid wages and other compensation owed to members of Local 6132 who provided services to Penn Hills.

The definition of “employer” set forth in WPCL is pre-empted in this case by the definition of “employer” set forth in the National Labor Relations Act (hereinafter “NLRA”). District 2 By Gormish v. Hinks, 67 B.R. 883, 889 (Bankr.W.D.Pa.1986) 1 As a consequence, this adversary action must be dismissed. Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 220-221, 105 S.Ct. 1904, 1916, 85 L.Ed.2d 206 (1985).

This court relied in Hinks upon the Supreme Court’s analysis in Lueck in arriving at its decision. See, e.g., Hinks, 67 B.R. at 886-887. Plaintiffs argue that this court should re-examine its holding in Hinks in light of the Supreme Court’s decision in Lingle v. Norge Division of Magic Chef, Inc., 486 U.S. 399, 108 S.Ct. 1877, 100 L.Ed.2d 410 (1988), which was decided some three years after Lueck.

Plaintiffs’ contention is without merit. Lingle in no way departed from or rejected the principles set forth in Lueck. There is nothing in Lingle that mandates a result in this case different from the result in Hinks.

The Supreme Court stated in Lueck that state law rights and obligations “... that do not exist independent of private agreements ... are preempted by those agreements”. Lueck, 471 U.S. at 213, 105 S.Ct. at 1912. The focus of inquiry is on whether state law confers non-negotiable rights on employers or employees:

... independent of any rights established by contract, or, instead, whether evaluation of ... [the state-law claim] is inextricably intertwined with consideration of the terms of the labor contract. If the state ... law purports to define the relationship, that law is pre-empted (emphasis added).

Id.

This principle was not rejected or modified in any way in Lingle. To the contrary, the Supreme Court in Lingle cited to Lueck approvingly and reaffirmed the same basic principle:

[54]*54In sum, we hold that an application of state law is preempted by § 301 of the Labor Management Relations Act only if such application requires the interpretation of a collective bargaining agreement.

Lingle, 486 U.S. at 412-413, 108 S.Ct. at 1886.

The primary significance of Lingle appears to lie in the Supreme Court’s rejection of one type of dependence as sufficient to justify pre-emption. The mere dependence of a state-law claim upon the identical set of facts as would be required to resolve a dispute arising under a collective bargaining agreement is not sufficient to require pre-emption:

... [Ejven if dispute resolution pursuant to a collective bargaining agreement, on the one hand, and state law, on the other, would require addressing the same set of facts, as long as the state-law claim can be resolved without interpreting the agreement itself, the claim is “independent” for § 301 preemption purposes.

Lingle, 486 U.S. at 409, 108 S.Ct. at 1883.

The dependence present in this case is not the sort of dependence which was rejected in Lingle. Resolution of plaintiffs’ claim under WPCL is not dependent solely upon the same set of facts as would be required to resolve a similar dispute arising under the collective bargaining agreement. To the contrary, plaintiffs’ state-law claim that debtor is liable for unpaid wages and other compensation provided for under the collective bargaining agreement cannot be resolved without considering the terms of that agreement and therefore is pre-empted. Lingle, 486 U.S. at 412-413, 108 S.Ct. at 1885.

Plaintiffs recently submitted their grievance against Penn Hills to arbitration. They charged Penn Hills with violating various provisions of the collective bargaining agreement. Debtor, in his individual capacity, was not named as a party to that proceeding and, accordingly, he could not and did not participate therein. Penn Hills elected not to appear. A hearing on the matter was held before an arbitrator on January 3, 1991, wherein it was determined that Penn Hills had violated various provisions of the collective bargaining agreement. No determination was made with respect to debtor.

Plaintiffs argue that their action against debtor under WPCL is not pre-empted in light of the arbitration proceeding. They contend that the collective bargaining agreement need not be considered in this case because that step was taken in the arbitration proceeding.

This contention is without merit. Because he was not a party to that proceeding, debtor, as an individual, would not have been permitted to participate. Serious questions concerning debtor’s right to due process would arise were any weight accorded to determinations by an arbitrator in a proceeding in which debtor was not a participant.

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Bluebook (online)
129 B.R. 51, 1991 Bankr. LEXIS 915, Counsel Stack Legal Research, https://law.counselstack.com/opinion/district-5-united-mine-workers-v-weiss-in-re-weiss-pawd-1991.