Internal. Union of Operating Engineers, Local 18 v. CNR Trucking Inc.

2013 Ohio 2094

• Court: Ohio Court of Appeals
• Decided: May 23, 2013
• Docket: 98935
• Status: Published

Opinion

[Cite as Internal. Union of Operating Engineers, Local 18 v. CNR Trucking Inc., 2013-Ohio-2094.]

Court of Appeals of Ohio EIGHTH APPELLATE DISTRICT COUNTY OF CUYAHOGA

JOURNAL ENTRY AND OPINION No. 98935

INTERNATIONAL UNION OF OPERATING ENGINEERS, LOCAL 18 PLAINTIFF-APPELLANT

vs.

CNR TRUCKING INCORPORATED, ET AL. DEFENDANTS-APPELLEES

JUDGMENT: AFFIRMED

Civil Appeal from the Cuyahoga County Court of Common Pleas Case No. CV-769170

BEFORE: Keough, J., Jones, P.J., and Kilbane, J.

RELEASED AND JOURNALIZED: May 23, 2013 ATTORNEY FOR APPELLANT

Timothy R. Fadel Wuliger, Fadel & Beyer 1340 Sumner Court Cleveland, Ohio 44115

ATTORNEYS FOR APPELLEES

For CNR Trucking, Inc.

Cara L. Santosuosso Laubacher & Company Westgate Towers, Suite 626 20525 Center Ridge Road Rocky River, Ohio 44116

For Laborers’ International Union of North America, Local 310

Andrew A. Crampton Susan L. Gragel Goldstein Gragel, L.L.C. 526 Superior Avenue, East Suite 1040 Cleveland, Ohio 44114 KATHLEEN ANN KEOUGH, J.:

{¶1} Plaintiff-appellant, International Union of Operating Engineers, Local 18

(“Local 18”) appeals from the trial court’s judgment dismissing its complaint against

defendants-appellees CNR Trucking, Inc. (“CNR”) and Laborers’ International Union of

North America, Local 310 (“Local 310”) for lack of subject matter jurisdiction. For the

reasons that follow, we affirm.

I. Facts and Procedural Background

{¶2} On May 16, 2009, CNR agreed to be bound by the terms and provisions of

the collective bargaining agreement between Local 310 and the Construction Employers

Association, effective May 1, 2009 to April 30, 2012.

{¶3} On August 31, 2011, CNR entered into two “addendum agreements” to the

collective bargaining agreement between Local 18 and the Construction Employers

Association, effective May 1, 2009 to April 30, 2012 (“Local 18 CBA”). The addenda

required CNR to “abide by all the terms and conditions contained in the [Local 18 CBA]

as to hours, wages, fringes, and other conditions of employment” and to pay a minimum

number of hours of fringe benefits on behalf of each employee at rates set forth in the

Local 18 CBA. CNR’s execution of the addendum agreements was a condition

precedent to CNR’s participation in and assent to the Local 18 CBA. The next day,

September 1, 2011, CNR agreed to be bound by the terms and provisions of the Local 18

CBA. {¶4} Local 18 subsequently filed suit against CNR and Local 310. In its

complaint, Local 18 alleged that on September 27, 2011, CNR sent correspondence to

Local 18 that repudiated the CBA and its addenda. Local 18 further alleged that Local

310 intentionally and without justification caused CNR’s repudiation of its agreements

with Local 18. In its complaint, Local 18 set forth claims for breach of contract against

CNR and tortious interference with contract against Local 310. Local 18 sought

compensatory damages from both CNR and Local 310, punitive damages from Local 310,

and specific performance of the agreements from CNR.

{¶5} After answering, both Local 310 and CNR filed Civ.R. 12(C) motions for

judgment on the pleadings, arguing that the court lacked subject matter jurisdiction over

Local 18’s claims because they were preempted by the National Labor Relations Act

(“NLRA”). The trial court denied the motions. Subsequently, upon Local 18’s request,

the originally-assigned judge recused himself, and the matter was reassigned.

{¶6} On August 21, 2012, the newly-assigned judge issued an opinion and

judgment entry dismissing the matter without prejudice for lack of subject matter

jurisdiction. The court determined that Local 18’s claims against Local 310 and CNR

were preempted by federal law; specifically, Section 8(b)(4)(D) of the NLRA.

{¶7} Local 18 now appeals from the trial court’s judgment dismissing its

complaint.1

On November 28, 2012, this court granted Local 18’s motion to dismiss CNR. Accordingly, 1

this appeal concerns only the trial court’s dismissal of Local 18’s claims against Local 310. II. Analysis

{¶8} In its single assignment of error, Local 18 argues that the trial court erred in

finding that its state-law claims against Local 310 for tortious interference with contract

were preempted by Section 8(b)(4)(D) of the NLRA.

{¶9} Because the issue of whether a trial court has subject matter jurisdiction

involves a question of law, we review a trial court’s judgment dismissing claims for lack

of subject matter jurisdiction de novo. State ex rel. Rothal v. Smith, 151 Ohio App.3d

289, 2002-Ohio-7328, 783 N.E.2d 1001, ¶ 110 (9th Dist.). When reviewing a matter de

novo, we afford no deference to the trial court’s decision. BP Communications Alaska v.

Cent. Collection Agency, 136 Ohio App.3d 807, 812, 373 N.E.2d 1050 (8th Dist.2000).

{¶10} The doctrine of preeemption in labor law was developed to prevent state

court interference with the federal regulatory scheme set forth in the NLRA. Bldrs. Assn.

of E. Ohio & W. Pennsylvania, Inc. v. Commercial Piping Co., Inc., 70 Ohio St.2d 9, 10,

434 N.E.2d 271 (1982). “‘The overriding goal of preemption has been to promote a

uniform application of the NLRA by a centralized administrative agency, thereby

avoiding potential conflict of rules of law, of remedy, and of administration,’

promulgated by different tribunals.” Id., quoting San Diego Bldg. Trades Council v.

Garmon, 359 U.S. 236, 242, 79 S.Ct. 773, 3 L.Ed.2d 775 (1959).

{¶11} The NLRA contains no express preemption provision. Ohio State Bldg. &

Constr. Trades Council v. Cuyahoga Cty. Bd. of Commrs. 98 Ohio St.3d 214,

2002-Ohio-7213, 781 N.E.2d 951, ¶ 46. Further, “Congress has neither exercised its full authority to occupy the entire field in the area of labor relations nor clearly delineated the

extent to which state regulation must yield to this subordinating federal legislation.” Id. at

¶ 49, citing Weber v. Anheuser-Busch, Inc., 348 U.S. 468, 480-481, 75 S.Ct. 480, 99

L.Ed. 546 (1955).

{¶12} Nevertheless, the United States Supreme Court has recognized two types of

preemption by the NLRA. The first, known as Garmon preemption, forbids state and

local regulation of activities arguably protected under Section 7 of the NLRA or

prohibited as an unfair labor practice under Section 8 of the Act. San Diego Bldg.

Trades Council at 246. Under the second type of preemption, known as Machinists

preemption, regulation will be preempted if Congress intended that the conduct involved

be unregulated and left to the free play of economic forces. Lodge 76, Internatl. Assn. of

Machinists & Aerospace Workers, AFL-CIO v. Wisconsin Emp. Relations Comm., 427

U.S. 132, 96 S.Ct. 2548, 49 L.Ed.2d 396 (1976). Both the Garmon and Machinists

analyses focus on the conduct or activities involved, and not the cause of action alleged,

when determining whether the cause is preempted by the NLRA. Humility of Mary

Health Partners v. Sheet Metal Workers’ Local Union No. 33, 7th Dist. No. 09 MA 91,

2010-Ohio-868, ¶ 17, citing Internatl. Longshoremen’s Assn., AFL-CIO v. Davis, 476

U.S. 380, 106 S.Ct. 1904, 90 L.Ed.2d 389 (1986).

{¶13} In this case, we find that Local 18’s tortious interference claims are

preempted under Garmon because the conduct alleged is arguably subject to Section

8(b)(4)(D) of the NLRA, which governs jurisdictional disputes between unions. {¶14} Under Section 8(b)(4)(D) of the NLRA, it is an unfair labor practice for a

labor organization to “threaten, coerce, or restrain any person engaged in commerce or in

an industry affecting commerce” where the intent is:

forcing or requiring any employer to assign particular work to employees in a particular labor organization * * * rather than to employees in another labor organization * * *.

This language condemns the “prototypical jurisdictional dispute” in which two rival

unions have collective bargaining agreements with one employer, each claims that its

members are entitled to perform a particular task for that employer, and the employer

“seems perfectly willing to assign work to either if the other will just let him alone.”

NLRB v. Radio & Television Broadcast Engineers Union, Local 1212 (Columbia

Broadcasting Serv.), 364 U.S. 573, 579, 81 S.Ct. 330, 5 L.Ed.2d 302 (1961) (“CBS”).

Employers involved in a jurisdictional dispute may file for a jurisdictional hearing with

the NLRB pursuant to Section 10(k) of the Act, and the National Labor Relations Board

is required to determine the merits of the dispute and award the disputed work in

accordance with its decision. Id.

{¶15} This case presents such a jurisdictional dispute. Both Local 18 and Local

310 have collective bargaining agreements with CNR, and Local 18 is alleging that Local

310 “wrongfully, intentionally, and without justification” procured CNR’s breach of its

agreement with Local 18. In short, Local 18 is alleging that Local 310 coerced CNR to

repudiate its agreement with Local 18 and assign the disputed work to Local 310’s

members, conduct that is arguably prohibited by Section 8(b)(4)(D). {¶16} Local 18 contends that this case does not involve a jurisdictional dispute,

however, because such a dispute requires that each union have a contract with the same

employer, and it has no agreement with CNR due to CNR’s repudiation. But a

repudiation of a contract does not rescind a contract; it merely results in the breach of that

contract. Am. Bronze Corp. v. Streamway Prods., 8 Ohio App.3d 223, 228, 456 N.E.2d

1295 (8th Dist.1982); Daniel E. Terreri & Sons, Inc. v. Mahoning Cty. Bd. of Commrs.,

152 Ohio App.3d 95, 2003-Ohio-1227, 786 N.E.2d 921 (7th Dist.). Moreover, there

could be no repudiation by CNR unless it did, in fact, have a contract with Local 18.

{¶17} Local 18 also argues that pursuant to CBS and its progeny, in order for there

to be any jurisdictional dispute within the exclusive purview of Section 8(b)(4)(D), there

must first be a claim to the same work made by two different groups. Local 18 asserts

that it has not made any claim for work “nor does Local 18 seek the assignment of such

work as a form of damages” anywhere “within the four corners of its complaint.” Our

review of Local 18’s complaint, however, demonstrates that it did indeed seek specific

performance from CNR, which can only be interpreted as a demand that CNR assign the

disputed work to Local 18.

{¶18} Local 18 next argues, citing Cleveland ex rel. O’Malley v. White, 148 Ohio

App.3d 565, 2002-Ohio-3633, 774 N.E.2d 337 (8th Dist.), that a state court may not find

lack of subject matter jurisdiction due to federal preemption unless the National Labor

Relations Board has rendered a decision regarding the same subject matter. But

O’Malley does not stand for the proposition argued by Local 18. While the O’Malley matter was pending on appeal, the NLRB issued a decision regarding an unfair labor

practice charge in a related matter. This court found that although the parties named in the

lawsuit and the unfair labor practice charge were different, the issue raised in the suit and

unfair labor practice charge were the same. Accordingly, this court found that the trial

court’s decision was preempted by the NLRB’s decision. The O’Malley decision did not

suggest, however, that a court cannot make a preemption determination absent a NLRB

finding on the same issue.

{¶19} Finally, at oral argument, Local 18 argued that the trial court improperly

considered material outside the pleadings in deciding Local 310’s motion for judgment on

the pleadings. Specifically, Local 18 argued that its complaint made no mention of

competing collective bargaining agreements such that the trial court’s finding that Local

18’s “claims concern conflicts between two CBA’s involving the same employer” was

necessarily based on information outside the record. However, in ruling on a Civ.R.

12(C) motion, a trial court is permitted to consider both the complaint and answer. State

ex rel. Midwest Pride IV, Inc. v. Pontious, 75 Ohio St.3d 565, 569, 1996-Ohio-459, 664

N.E.2d 931. Paragraph 11 of Local 310’s answer stated that on May 16, 2009, CNR

executed a collective bargaining agreement with Local 310. A copy of CNR’s

participation and assent agreement and the Local 310 collective bargaining agreement

were attached as exhibits to Local 310’s answer. Accordingly, the trial court did not err in

considering these materials from Local 310’s answer. {¶20} Finding no merit to Local 18’s arguments, we overrule the assignment of

error and affirm the trial court’s judgment dismissing Local 18’s claims against Local 310

for lack of subject matter jurisdiction.

{¶21} Affirmed.

It is ordered that appellee recover from appellant costs herein taxed.

The court finds there were reasonable grounds for this appeal.

It is ordered that a special mandate be sent to said court to carry this judgment into

execution.

A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of

the Rules of Appellate Procedure.

KATHLEEN ANN KEOUGH, JUDGE

LARRY A. JONES, SR., P.J., and MARY EILEEN KILBANE, J., CONCUR