Johns-manville Products Corp. v. Doyal

510 F.2d 1196

• Court: Court of Appeals for the Fifth Circuit
• Decided: April 4, 1975
• Docket: No. 74-1620
• Status: Published

Opinions

GEE, Circuit Judge:

Despite negotiation, Johns-Manville Products Corporation, Oil, Chemical and Atomic Workers International and its Local 4 — 390 were unable to agree on a new collective bargaining contract covering workers at a New Orleans, Louisiana, plant after the October 12, 1973, expiration of the previous agreement. Nevertheless, the workers continued on the job after expiration of the contract until Johns-Manville closed the plant on October 31, 1973, having notified their employees that the plant would not be reopened until a new collective bargaining agreement was reached. The plant was closed due to equipment failures posing, management said, dangers to safety. Management contends that the failures were the work of union saboteurs seeking to enhance the union’s bargaining position in the contract negotiations. After the plant closing, some employees applied for and were awarded unemployment compensation by the State of Louisiana, despite Johns-Man-ville’s charge that the employees were unemployed due to a labor dispute and thus disqualified from receiving benefits under Louisiana law.¹ Johns-Manville filed suit in federal court, claiming that the Louisiana administrative orders awarding their employees unemployment compensation were preempted by federal labor law, violative of the Fourteenth Amendment and contrary to the Louisiana Employment Security Law. The court below abstained for Pullman² reasons.

To the contrary, Pullman does not mandate abstention in this case, one of its prerequisites being absent.³ The Supreme Court has made it clear that invocation of Pullman is proper only when an issue of state law is uncertain. Reetz v. Bozanich, 397 U.S. 82, 86, 90 S.Ct. 788, 25 L.Ed.2d 68 (1970); Harman v. Forssenius, 380 U.S. 528, 534, 85 S.Ct. 1177, 14 L.Ed.2d 50 (1965); Gray Line Motor Tours, Inc. v. City of New Orleans, 498 F.2d 293, 298 (5th Cir. 1974); Moore’s Federal Practice, 10.203 (2d ed.); C. Wright, Federal Courts § 52 (2d ed.). The statute in question is not one unconstrued by the state courts nor one which the state courts have left bare of policy guidelines. See Leiter Minerals, Inc. v. United States, 352 U.S. 220, 229, 77 S.Ct. 287, 1 L.Ed.2d 267 (1957). As to whether unemployment is the result of a labor dispute, the Louisiana courts have applied the law to other than simple strike situations. Singleton v. Brown, 153 So.2d 902 (La.App.1963) (wildcat strike followed by company lockout due to lack of agreement on a no-strike clause); Elmer Candy Corp. v. Administrator of Employment Security, 286 So.2d 423 (La.App.1973) (use of permanent replacements for strikers, court reliance on federal labor law). Further, it has been applied in a situation where management’s action could have been construed as the result of a labor dispute or the result of independent economic factors. Singleton v. Brown, supra. In addition, on remand the trial court will have the benefit of a more recent case, National Gypsum Co. v. Administrator, La. Dep’t of Employment Security, 300 So.2d 527 (La.App.1974). That case adopted a broad definition of labor dispute, covering a lockout resulting from a negotiation impasse.

The question of interest in and participation in a labor dispute has been subjected to state judicial scrutiny several times. Senegal v. Lake Charles Stevedores, Inc., 197 So.2d 648 (La.1967); Elmer Candy Corp. v. Administrator of Employment Security, supra; Hanndyman Homes, Inc. v. Administrator, Div. of Employment Security of Dep’t of Labor, 192 So.2d 827 (La.App.1966), writ ref’d, 250 La. 251, 195 So.2d 141 (1967); Brown v. Brown, 158 So.2d 305 (La.App.1963), writ ref’d, 245 La. 639, 160 So.2d 227 (1964), cert. denied, 377 U.S. 979, 84 S.Ct. 1885, 12 L.Ed.2d 747 (1964).

As for policy, the state supreme court has given one reason for the legislation:

The Louisiana Employment Security Law requires the employer to pay substantial sums into a fund from which unemployment compensation benefits are paid. The employee contributes nothing to this fund. Avoiding placing an employer in a position of being compelled by statute to subsidize a strike undoubtedly was one of the reasons which prompted the Legislature to disqualify those who are participating in or interested in the labor dispute, and we consider that a broad disqualification was intended by those categories.

Senegal v. Lake Charles Stevedores, Inc., supra, 197 So.2d at 650-51. Additionally, a lower state court has said: “[I]n cases coming under R.S. 23:1601(4), we are confronted with an equally important policy of this state, that is, that the state should maintain a fair and neutral position in regard to labor disputes.” National Gypsum Co. v. Administrator, La. Dep’t of Employment Security, supra, 300 So.2d at 534. In short, the statute is not so ill-defined that the federal court should delay decision.

On cross-appeal, the defendants seek to support dismissal of the suit. First, they argue that California Dep’t of Human Resources Development v. Java, 402 U.S. 121, 91 S.Ct. 1347, 28 L.Ed.2d 666 (1971), precludes the state’s suspending payment of benefits without hearing once eligibility has been determined. That ease does so hold; however, there is here no question of suspension of benefits pending hearing in court. At oral argument counsel revealed that the employees were no longer receiving benefits.

We decline to accept the invitation to dismiss for nonjusticiability. There are standards to determine whether federal labor law is preemptive. See Cox, Labor Law Preemption Revisited, 85 Harv.L.Rev. 1337 (1972). To the extent that the court is also required to consider national and state unemployment compensation statutes, the task is not an unfamiliar one. Courts are often called upon to resolve statutory differences. See, e. g., FPC v. Memphis Light, Gas & Water Div., 411 U.S. 458, 93 S.Ct. 1723, 36 L.Ed.2d 426 (1973). Also, fashioning a remedy is not without the competence of the court.

Finally, we decline to pass on preemption at this time. The trial court did not reach the issue on the merits; indeed, that was the reason for abstention. Feeling we could benefit from development of the record and the lower court’s analysis on both the possibility of mootness⁴ and, if necessary, the merits, we reverse and remand for consideration in accordance with this opinion.

Reversed and remanded.

1 . “An individual shall be disqualified for benefits: . . For any week with respect to which the administrator finds that his unemployment is due to a labor dispute which is in active progress at the factory, establishment, or other premises at which he is or was last employed; but such disqualification shall not apply if it is shown to the satisfaction of the administrator that he is not participating in or interested in the labor dispute which caused his unemployment."

LSA-R.S. 23:1601(4).

2 Railroad Comm’n of Texas v. Pullman Co., 312 U.S. 496, 61 S.Ct. 643, 85 L.Ed. 971 (1941).

3 . Our opinion is focused on clarity of state law; however, Johns-Manville contended that abstention was improper since the second Pullman prerequisite — a federal constitutional question — was missing. The court below did rely only on the Supremacy Clause; however, we will not speak to this point since JohnsManville did charge due process and equal protection violations in the complaint.

4 . See Super Tire Eng’ring Co. v. McCorkle, 416 U.S. 115, 94 S.Ct. 1694, 40 L.Ed.2d 1 (1974).