Granite Rock Co. v. International Brotherhood of Teamsters

546 F.3d 1169
CourtCourt of Appeals for the Ninth Circuit
DecidedOctober 22, 2008
Docket07-15040, 07-16142, 07-16236
StatusPublished
Cited by10 cases

This text of 546 F.3d 1169 (Granite Rock Co. v. International Brotherhood of Teamsters) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Granite Rock Co. v. International Brotherhood of Teamsters, 546 F.3d 1169 (9th Cir. 2008).

Opinion

GOULD, Circuit Judge:

Granite Rock Company (“Granite Rock”) sued International Brotherhood of Teamsters, Local 287 (“Local 287”) and International Brotherhood of Teamsters (“IBT”) under section 301(a) of the Labor Management Relations Act (“LMRA”) with claims relating to a collective bargaining agreement. Granite Rock seeks remedies against Local 287 for breach of the collective bargaining agreement, and against IBT for tortious interference with the collective bargaining agreement between Granite Rock and Local 287. The district court dismissed the claim against IBT under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. Granite Rock appeals that dismissal, and we affirm.

In the dispute between Granite Rock and Local 287, the parties appeal and cross-appeal a total of five orders, but we need reach only one: the district court’s denial of Local 287’s motion to compel arbitration on the question of contract formation. We reverse that ruling and remand with instructions to compel arbitration on the entire dispute between Granite Rock and Local 287.

I

For purposes of analyzing the district court’s dismissal of Granite Rock’s claims against IBT, Granite Rock’s alleged facts must be presumed true and viewed in the light most favorable to Granite Rock. Pakootas v. Teck Cominco Metals, Ltd., 452 F.3d 1066, 1069 (9th Cir.2006). Granite Rock alleges: Granite Rock is a California company engaged in supplying ready mixed concrete for commercial use, and Local 287 represents certain employees at Granite Rock’s San Jose facility. Between March 1, 1999 and April 30, 2004, Granite Rock and Local 287 were parties to a collective bargaining agreement (“CBA”). Before expiration of that agreement, the parties began negotiations. Throughout the negotiations, Rome Aloise (“Aloise”), the administrative assistant to the General President of IBT, advised Local 287 that certain provisions of the CBA were inadequate. Aloise also represented the interests of IBT and other local unions affiliated with IBT in the negotiations. No resolution was reached in April or May, and in early June, 2004, after the CBA between Granite Rock and Local 287 expired, Local 287 members went on strike. Negotiations resumed shortly thereafter, and the parties reached a tentative four-year agreement (“new CBA”) at 4:00 a.m. on July 2, 2004. This tentative agreement contained a broad arbitration clause requiring the parties to arbitrate “[a]ll disputes arising under this agreement.”

At the conclusion of the successful bargaining session, George Netto (“Netto”), Business Representative for Local 287, told Granite Rock’s CEO Bruce Woolpert that Netto would put the new CBA to a vote among the union members, would recommend ratification, and would cease picketing. At the same time, Netto raised the topic of a “back-to-work” agreement to provide for the terms under which the parties would return to work, including liability for actions taken during the strike. However, the parties agreed to discuss preparing a back-to-work agreement at a later date.

*1172 Local 287 members allegedly ratified the new CBA, which contained a “no-strike” clause, later on the morning of July 2, 2004. However, on July 5, 2004, Aloise and members of Local 287 called workers to instruct them not to return to work the next day. On July 6, 2004, Netto demanded a back-to-work agreement that would explicitly shield Local 287, its members, and IBT from any liability arising from the strike. Granite Rock refused to sign such an agreement, and Local 287 continued its strike in violation of the no-strike clause. Throughout the strike, Aloise played an active leadership role; he sent letters to other local unions and employees encouraging their support, held meetings to discuss strategy, and sought to secure financial support for the strike. IBT gave benefits to Local 287 members as long as they did not return to work.

Granite Rock’s Third Amended Complaint alleged breach of contract against Local 287, and tortious interference with contract against IBT. Both actions were asserted under section 301(a) of the LMRA, 29 U.S.C. § 185(a). Defendant IBT moved to dismiss the complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. The district court granted that motion on the grounds that Granite Rock failed to state a claim against IBT under section 301(a). Granite Rock timely appealed.

There is only one fact that is critical to our determination of whether the entire dispute between Granite Rock and Local 287 should have been submitted to arbitration, and that fact is undisputed: While the parties disagree about the ratification date, they agree that the tentative new CBA reached on July 2, 2004, contains an arbitration clause that requires arbitration for “[a]ll disputes arising under this agreement.” Interpreting this clause, the district court dismissed the issues of breach and damages in favor of arbitration, but retained the question of contract ratification for the district court’s determination. Local 287 timely appealed the order retaining the formation question.

Because we determine that the district court erred by denying Local 287’s motion to compel arbitration of the entire dispute, and we remand for arbitration, we need not address the appealed orders that arose from the district court’s rulings in resolving on the merits the issue of contract formation by ratification.

II

The district court’s dismissal of Granite Rock’s claims against IBT presents questions of law which we review de novo. Pruitt v. Cheney, 963 F.2d 1160, 1162-63 (9th Cir.1992).

Section 301(a) of LMRA, 29 U.S.C. § 185(a), provides:

Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.

Jurisdiction over a claim under section 301(a) requires two things: First, that the claim be “based on an alleged breach of contract between an employer and a labor organization,” and second, “that the resolution of the lawsuit be focused upon and governed by the terms of the contract.” Painting & Decorating Contractors Ass’n v. Painters & Decorators Joint Comm., Inc., 707 F.2d 1067, 1071 (9th Cir.1983).

A party need not be a signatory to a CBA to come within the purview of section 301(a). In Painters & Decorators, *? the “Joint Committee” — created by the bargaining agreement to administer the terms of the agreement — -was not a signatory of the agreement.

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546 F.3d 1169, Counsel Stack Legal Research, https://law.counselstack.com/opinion/granite-rock-co-v-international-brotherhood-of-teamsters-ca9-2008.