Surf City Steel, Inc. v. International Longshore & Warehouse Union

123 F. Supp. 3d 1219, 2015 U.S. Dist. LEXIS 97466, 2015 WL 4999795
CourtDistrict Court, C.D. California
DecidedJune 18, 2015
DocketCase No. CV 14-05604 BRO (SSx)
StatusPublished
Cited by1 cases

This text of 123 F. Supp. 3d 1219 (Surf City Steel, Inc. v. International Longshore & Warehouse Union) is published on Counsel Stack Legal Research, covering District Court, C.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Surf City Steel, Inc. v. International Longshore & Warehouse Union, 123 F. Supp. 3d 1219, 2015 U.S. Dist. LEXIS 97466, 2015 WL 4999795 (C.D. Cal. 2015).

Opinion

ORDER RE: MOTION TO DISMISS [48]

BEVERLY REID O’CONNELL; District Judge

I. INTRODUCTION.

Pending before the .Court is Defendants’ motion to dismiss Plaintiffs’ Second Amended Complaint (“SAC”) pursuant to Federal Rule of Civil Procedure 12(b)(6). (Dkt. No. 48.) After consideration of the papers "filed in support of and in opposition to, the instant, motion, the Court deems this matter appropriate for decision ■ without [1224]*1224oral argument of counsel. See Fed.R.Civ.P. 78; C.D. Cal. L.R. 7-15. For the following reasons, Defendants’ motion is GRANTED in part and DENIED in part.

II. BACKGROUND

A.The Parties

Plaintiffs are comprised of two primary groups. First, Plaintiffs Surf City Steel, Inc. and Sarens USA, Inc. (collectively, the “Employer Plaintiffs”) are each California corporations that constitute “employers” within the meaning of 29 U.S.C. § 152(2).1 (SAC ¶¶5-6.) Plaintiffs allege that the Employer Plaintiffs each perform work within the relevant market area -described in the SAC and performed relevant work within that market area. (SAC ¶7.) Second, Plaintiffs International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers (“Iron Workers”), International Association Local 378, International Association Local 377, International Association Local 433, International Associations Local 29, and International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers Local 86 (collectively, the “Union Plaintiffs”) are labor unions whose members perform relevant work. (SAC ¶¶ 8-13.)

Defendants are also labor unions that “conduct[] activities as a labor organization” in the relevant market area as defined in the SAC. (SAC ¶¶ 14-18.) The named Defendants in this action include International Longshore Warehouse Union (“ILWU”), ILWU Local 10, ILWU Local 8, ILWU Local 19, and ILWU Local 13. (SAC ¶¶ 14-18.)

B. The Relevant Market Area and Relevant Work

As defined in the SAC, the “relevant market area” consists of “those port facilities on the West Coast of the United States within the States of California, Oregon and" Washington, including the Long Beach, California Port Facility; the Los Angeles, California Port Facility; the Oakland, California Port Facility; the San Francisco Port Facility; the Portland, Oregon Port Facility; and the Seattle/Tacoma, Washington Port Facility.” (SAC ¶ 19.)

The SAC also defines the “relevant work” as: “the labor and services necessary for the non-operational structural maintenance and structural modification of cranes and movement of cranes and all other work in connection therewith; and the jacking, eréction and modification of new cranes and of existing cranes and movement of new cranes and existing cranes in connection therewith. This includes the relocation of such cranes when such relocation or movement involves either the installation of new cranes or the jacking, erecting, and modification of existing cranes, including the removal, wrecking and dismantling of such cranes and rubber gantry cranes.” (SAC ¶ 20.)

C. Factual Background

Plaintiffs allege that Defendants have acted in concert with various port managers who conduct business in the relevant market area to monopolize the relevant work market and exclude Plaintiffs from conducting business in the relevant work market area. (SAC ¶27.) According to Plaintiffs, in 2008 Defendants entered into [1225]*1225an agreement with the port managers— known as the Pacific Coast Longshore Contract Document (“PCLCD”) — which covers the relevant work involving ports along the West Coast, including in Long Beach, Los Angeles, Oakland, Oregon, and Washington State. (SAC ¶ 38.) Plaintiffs allege that the purpose and intent of the PCLCD is to eliminate the competition that Defendants would face from Plaintiffs in the relevant market. (SAC ¶ 45.) Plaintiffs further allege that the agreement is not designed to preserve work that Defendants have historically performed, but instead for Defendants to monopolize labor in the relevant market to control the price of labor. (SAC ¶¶ 41-58.) Plaintiffs claim that the PCLCD has no pro-competitive justification. (SAC ¶ 59.)

Additionally, the PCLCD includes a mandatory grievance and arbitration process, by which Defendants have enforced the agreement against Plaintiffs. (SAC ¶ 39.) The SAC asserts that the PCLCD’s arbitration mechanism effectively prohibits Plaintiffs — who are not signatories to the PCLCD — from bidding on projects and performing work that they have traditionally performed in the relevant market area. (SAC ¶¶ 60-68.) In support of these allegations, Plaintiffs provide a number of factual examples in which Plaintiffs were precluded from bidding or working on certain projects in the relevant market area because they were not ILWU contractors. (See SAC ¶¶ 69-89.)

D. Procedural History

As a result of these allegations, Plaintiff Iron Workers sent ILWU a letter in June 2014 in which Iron Workers accused Defendants of violating federal antitrust laws. (SAC ¶ 68.) When ILWU did not respond, Plaintiffs filed their Complaint on July 18, 2014. (Dkt. No. 1.) On October 9, 2014, Defendants filed a motion to dismiss the Complaint, (Dkt. No. 27), which the Court granted on January 20, 2015 with leave to amend, (Dkt. No. 40). Plaintiffs then filed a First Amended Complaint on February 9, 2015. (Dkt. No. 41.) On February 23, 2015, Defendants filed a motion to dismiss the First Amended Complaint, (Dkt. No. 42), which the'Court granted on April 6, 2015, again with leave to amend, (Dkt. No. 46).

Plaintiffs then filed the SAC on April 20, 2015. (Dkt. No. 47.) In the SAC, Plaintiffs allege three causes of action for:'(l) violation of sections 1 and 2 of the Sherman Act, (SAC ¶¶ 90-130); (2) breach of contract, (SAC ¶¶ 131-42); and (3) violation of section 303 of the Labor-Management Relations Act (“LMRA”), 29 U.S.C. § 187, (SAC ¶¶ 143-62). Defendants then brought the instant motion to dismiss the SAC on May 4, 2015. (Dkt. No. 48.) Plaintiffs opposed this motion on May 21, 2015, (Dkt. No. 50), and Defendants replied on June 8, 2015, (Dkt. No. 51),

III. LEGAL STANDARD

Under Rule 8(a), a complaint must contain a “short and plain statement of the claim showing that the [plaintiff] is entitled to relief.” Fed. R. Civ. P. 8(a). If a complaint fails to do this, the defendant may move to dismiss it under Rule 12(b)(6), Fed. R. Civ. P. 12(b)(6). “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009).

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123 F. Supp. 3d 1219, 2015 U.S. Dist. LEXIS 97466, 2015 WL 4999795, Counsel Stack Legal Research, https://law.counselstack.com/opinion/surf-city-steel-inc-v-international-longshore-warehouse-union-cacd-2015.