United States ex rel. Int'l Bhd. of Elec. Workers Local Union No. 98 v. Farfield Co.

389 F. Supp. 3d 275
CourtDistrict Court, E.D. Pennsylvania
DecidedMay 2, 2019
DocketCIVIL ACTION No. 09-4230
StatusPublished
Cited by1 cases

This text of 389 F. Supp. 3d 275 (United States ex rel. Int'l Bhd. of Elec. Workers Local Union No. 98 v. Farfield Co.) is published on Counsel Stack Legal Research, covering District Court, E.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States ex rel. Int'l Bhd. of Elec. Workers Local Union No. 98 v. Farfield Co., 389 F. Supp. 3d 275 (E.D. Pa. 2019).

Opinion

KEARNEY, DISTRICT JUDGE

Electrical contractor The Farfield Company moves to dismiss arguing a federal court may not decide whether it misclassified its union electricians because the Department of Labor declined to resolve this worker classification issue which it claims is central to a False Claims Act case. The Farfield Company argues the misclassification claims are "nonjusticiable" without the Department of Labor's determination. We agreed with The Farfield Company as to a need for the Department of Labor to initially review this issue within its expertise. The Plaintiff inexplicably neglected to do so for over a year. Upon assignment to our docket, we directed the Plaintiff immediately ask for a referral. The Department of Labor declined the referral several weeks ago. But its declination does not destroy our subject matter jurisdiction. It simply declined to invest public resources in this analysis of conduct over a decade ago. We know of no authority, and The Farfield Company offers none, suggesting a party seeking a remedy otherwise within our jurisdiction is not welcome here because the Department of Labor declined the first opportunity to review the worker misclassification issue. We properly deferred to the Department of Labor under the primary jurisdiction doctrine, but with it declining to investigate, we must proceed requiring the Plaintiff prove the misclassification.

I. Background

Nearly ten years ago, on September 17, 2009, the International Brotherhood of Electrical Workers Local Union No. 98 (the "Union") filed a sealed complaint under the False Claims Act1 on behalf of the United States against The Farfield Company ("Farfield"). The Union alleged Farfield, an electrical contractor, violated the False Claims Act when it intentionally misclassified workers performing electrician's work as laborers, groundsmen, or other classifications with lower pay rates, to gain a bidding advantage over its competitors on five federally funded construction projects on Philadelphia-area transit systems between 2001 and 2007 in violation of the Davis-Bacon Act.2

*278Two years later, on September 21, 2011, the United States declined to intervene in the action. The court unsealed the complaint. The Union filed an amended complaint on February 3, 2012.3 In its amended complaint, the Union again alleged Farfield intentionally and knowingly misclassified workers performing electrician's work to gain a competitive bidding advantage on same the federally funded construction projects between 2001 and 2009.4

The Union alleges it investigated Farfield's practices and found Farfield "designed and implemented a scheme of under-bidding prevailing wage projects by classifying workers at lower hourly wage rates than permitted by the Davis-Bacon Act."5 The Union identified nine employees working as electricians on the federally-funded transit projects who Farfield allegedly paid at rates below the prevailing wage based on Farfield's false certifications submitted to SEPTA and PATCO knowing it misclassified these employees.6

Farfield moves to dismiss the amended complaint.

Farfield moved to dismiss the amended complaint arguing, inter alia , the court does not have subject matter jurisdiction over this dispute because the Department of Labor has "exclusive jurisdiction" over the matter.7 Farfield argued disputes over proper classification of workers under the Davis-Bacon Act are reserved exclusively to the Department of Labor.8

The Union responded we have subject matter jurisdiction to determine whether Farfield violated the False Claims Act and there is no conflict with the Department of *279Labor's exclusive jurisdiction.9 The Union argued the "prevailing wage practice is undisputed," there are no classification question, there are no complexities or uncertainties in the case requiring any determination by the Department of Labor, the projects at issue are "governed by contracts which set forth a clear and undisputed prevailing wage practice," and the court has exclusive jurisdiction over the matter.10

On July 2, 2013, the Honorable Lawrence F. Stengel denied Farfield's motion to dismiss.11 Judge Stengel found the Department of Labor has exclusive authority to establish minimum wages for particular classification of laborers and mechanics and to define work included within each classification where there is any ambiguity.12 Judge Stengel explained the primary jurisdiction doctrine allows a court to defer adjudication until the appropriate agency makes a determination "placed within the special competence of an administrative body."13 Judge Stengel concluded the parties' dispute centered on whether Farfield "properly classified its employees for purposes of wage determinations" under the Davis-Bacon Act.14 But Judge Stengel found these classifications are "not complex and were previously defined by the department of labor with regard to the work performed" and resolution of the Union's allegations of false statements in misclassification resulting in underpayment to workers "is not dependent on interpretation" of classification and wage determinations.15 In reaching his conclusion, Judge Stengel relied on the Union's argument, in opposition to the motion to dismiss, its allegations do not involve a complex classification dispute. Judge Stengel denied Farfield's motion, and found the court's jurisdiction appropriate.16

The Union seeks experts for trial on classification issues it previously represented as not complex.

The parties engaged in discovery for years, including the appointment of a special discovery master to handle discovery disputes. Discovery continued until an early 2017 status conference where the Union described offering three electrical trade industry experts as witnesses at trial. Judge Stengel ordered the parties to submit briefing on the issue of expert testimony.17

Contradicting its earlier position there are no complex classification issues requiring Department of Labor determination, the Union argued it needed expert testimony to oppose any summary judgment motion filed by Farfield and to prove its case at trial.18 The Union argued its three experts will "provide a yardstick against which to measure the reasonableness of Farfield's classification of its employees, and thus establish that Farfield acted in reckless disregard of its contractual and *280statutory compliance obligations."19

Farfield contended expert testimony is improper and the court lacks subject matter jurisdiction, arguing if worker classifications are so complex as to require expert testimony, then the court lacks jurisdiction and the matter must be dismissed and referred to the Department of Labor for classification and wage determinations.20

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Bluebook (online)
389 F. Supp. 3d 275, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-ex-rel-intl-bhd-of-elec-workers-local-union-no-98-v-paed-2019.