Opinion
Civil Aciion No. 1:01CV-175-R
January 17, 2002
MEMORANDUM OPINION
This case is before the Court on Third-Party Defendant United Steelworkers of America's ("the Union") Motion to Dismiss Third-Party Plaintiff's Third-Party Complaint (Dkt. #6). Third-Party Plaintiff Tyson Bearing Company submitted a response (Dkt. #7), to which the Union replied (Dkt. #8), and this matter is now ripe for adjudication. For the reasons that follow, this Court GRANTS the Union's Motion.
BACKGROUND
On August 29, 2001, fifty Tyson employees filed suit against their employer in Barren Circuit Court, alleging that Tyson violated the Kentucky Civil Rights Act ("KCRA"). Plaintiffs, all over 50 years of age, claim that Tyson pays them lower wages and gives them less advantageous vacation benefits than their co-employees because of their status as recipients of a pension from the former owner of the Tyson facility. Plaintiffs assert that this treatment is pursuant to a collectively bargained agreement between the Union and Tyson that in itself violates KRS 344.060(2) and (3). Plaintiffs further aver that this treatment has a disparate impact on individuals over the age of 40 and thus violates the KCRA age provisions of KRS 344.040(1).
Tyson removed this action to this Court on October 5, 2001. As grounds for removal, Tyson relied upon diversity of citizenship and asserted that Plaintiffs' claims implicate Section 301 of the Labor-Management Relations Act, 29 U.S.C. § 185. Alongside its Notice of Removal, Tyson filed an Answer to Plaintiffs' Complaint in which it denied that its actions violated state law
On October 19, 2001, Tyson submitted a Third-Party Complaint against the Union. Tyson's Complaint alleged that "[i]f . . . Plaintiffs' theory of recovery were true, then the Union, a party to the claimed unlawful agreement, would be liable to respond to Plaintiffs' claims." Alternatively, Tyson averred that "since the terms of the said collectively-bargained agreement claimed by Plaintiffs to be unlawful were agreed to by the Union, the Union should be made a party so as to be in a position to defend its actions as to said agreement and protect the broader interests of its members . . . under its duty of fair representation owed to all members."
The Union now seeks to dismiss Tyson's Third-Party Complaint.
STANDARD
When considering a motion to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, the district court must accept all of the allegations in the complaint as true, and construe the complaint liberally in favor of the plaintiff. See Lawrence v. Chancery Court of Tennessee, 188 F.3d 687, 691 (6th Cir. 1999). Denial of the motion is proper "unless it can be established beyond a doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Achterhof v. Selvaggio, 886 F.2d 826, 831 (6th Cir. 1989) (citing Conley v. Gibson, 355 U.S. 41, 45-46 (1957)). Nonetheless, conclusory allegations or legal conclusions masquerading as fact will not prevent a motion to dismiss. Jackson v. City of Columbus, 194 F.3d 737, 745 (6th Cir. 1999).
DISCUSSION
A. The Union as a Third-Party Defendant
Rule 14 of the Federal Rules of Civil Procedure allows a defending party to implead a third party "who is or may be liable to the third-party plaintiff [defendant] for all or part of the plaintiff's claim against the third-party plaintiff." Fed.R.Civ.P. 14(a). An impleading defendant must show that the third party is potentially liable directly to the defendant and not merely potentially liable to the plaintiff alongside the defendant. Brown v. Int'l Union, United Auto., Aerospace Agric. Implement Workers, 85 F.R.D. 328, 336 (W.D. Mich. 1980); see Huggins v. Graves, 337 F.2d 486, 489 (6th Cir. 1964). Without such a showing, the third party cannot be added to the existing suit using Rule 14 impleader.
1. Indemnity and/or Contribution
To support its Third-Party Complaint against the Union, Tyson first claims that it is entitled to indemnity and/or contribution from the Union because the Union was a party to the allegedly discriminatory contract. With this argument, Tyson apparently asserts that the Union is equally culpable in the age discrimination against Plaintiffs. Rather than base this indemnity/contribution claim upon the Union's duty of fair representation, Tyson bases this argument on alleged direct discrimination by the Union in its capacity as a contractual party.
In the Title VII context, a union can be liable for an employer's discrimination against union members pursuant to a collectively bargained agreement. Jackson v. Seabord Coast Line R.R. Co., 678 F.2d 992, 1016 (11th Cir. 1982); Parson v. Kaiser Alum. Chem. Corp., 575 F.2d 1374, 1389 (5th Cir. 1978); see also Ariz. Governing Comm. v. Norris, 463 U.S. 1073, 1090 (1983) ("[I]t is well established that both parties to a discriminatory contract are liable for any discriminatory provisions the contract contains, regardless of which party initially suggested inclusion of the discriminatory provisions."). This imposition of liability under Title VII is significant because the Kentucky Civil Rights Act, which provides the basis for Plaintiffs' suit against Tyson, was based largely on the federal Civil Rights Act (of which Title VII is a part) and receives both substance and form from that Act. Kreate v. Disabled Am. Veterans, 33 S.W.3d 176, 178 (Ky. 2000). Accordingly, Kentucky courts interpret the KCRA consistently with federal law, Ammerman v. Bd. of Educ. of Nicholas County, 30 S.W.3d 793, 797-98 (Ky. 2000), and often look to federal decisional law when interpreting the KCRA. Brewer v. Hillard, 15 S.W.3d 1, 10-11 (Ky.App. 1999). Therefore, because a union can be liable under Title VII for an employer's discrimination against union members pursuant to a collectively bargained agreement, the KCRA would allow similar union liability.
Liability to Plaintiffs does not necessarily imply that either indemnity or contribution is appropriate, however. It is theoretically possible for indemnity or contribution between the Union and Tyson to be appropriate, see Stevenson v. Int'l Paper Co., 432 F. Supp. 390, 408-09 (W.D. La. 1977), since a Union's participation in the collective bargaining agreement makes it "jointly liable" for "[a]ny monetary liability imposed upon the employer," Parson, 575 F.2d at 1389. For this theoretical possibility to coalesce into reality, however, Kentucky's requirements for indemnity or contribution must be met.
There exists no federal common law right to either indemnity or contribution, and "federal courts have held that those state law remedies cannot be applied to causes of action created by federal statutes." Degener v. Hall Contracting Corp., 27 S.W.3d 775, 782 (Ky. 2000) (citations omitted). Given this difference, Tyson's right to indemnity or contribution is greatly affected by the substantive law — federal or state — applicable to Plaintiffs' claims against Tyson. Because the parties have not addressed whether Plaintiffs' KCRA claims against Tyson might be preempted by federal law, the Court assumes that Plaintiffs' KCRA claims are not preempted and expresses no opinion on the appropriateness of preemption.
Under Kentucky law, "[t]he right to contribution arises when two or more joint tortfeasors are guilty of concurrent negligence of substantially the same character which converges to cause the plaintiffs damages." Deneger v. Hall Contracting Corp., 27 S.W.3d 775, 778 (Ky. 2000). Similarly, the right to indemnity "is available to one exposed to liability because of the wrongful act of another" but who is not equally at fault with the wrongdoer. Id. At 780. Indemnity can be invoked in two situations:
(1) Where the party claiming indemnity has not been guilty of any fault, except technically, or constructively, as where an innocent master was held to respond for the tort of his servant acting within the scope of his employment; or (2) where both parties have been in fault, but not in the same fault, towards the party injured, and the fault of the party from whom indemnity is claimed was the primary and efficient cause of the injury.
Id. (quoting Louisville Ry. Co. v. Louisville Taxicab Transfer Co., 77 S.W.2d 36, 39 (1934)). Both indemnity and contribution maybe invoked during adjudication of the underlying action even though liability has not yet been determined. Id. (citing Robert F. Simmons Constr. Co., Inc. v. Am. States Ins. Co., 426 S.W.2d 441, 443-44 (Ky. 1968)).
Contribution in tort is appropriate only when negligence is alleged, not when recovery is sought for an intentional wrong. Sutton v. Morris, 44 S.W. 127, 127 (Ky. 1898); see KLRS 412.030 ("Contribution among wrongdoers may be enforced where the wrong is a mere act of negligence and involves no moral turpitude."). A claim for discrimination is one based upon an intentional tort, however. Howard Baer, Inc. v. Schave, No. 1999-CA-001969-MR, 2001 WL 929990, at *3 (Ky.App. Aug. 17, 2001); see, e.g., Lexington-Fayette Urban County Housing Authority v. Brooks,___ S.W.3d___, 2001 WL 1042863, at *4-9 (Ky.App. Sept. 7, 2001) (plaintiff in racial discrimination case must show intentional discrimination); Ky. Ctr. for the Arts v. Handley, 827 S.W.2d 697, 700-01 (Ky.App. 1991) (same); cf. N. Bank v. Cincinnati Ins. Co., 125 F.3d 983, 987 (6th Cir. 1997) (discrimination is normally an intentional tort). Therefore, a discrimination claim under the Kentucky Civil Rights Act is not subject to contribution.
Indemnity, like contribution, is also inappropriate in the present action. First, Tyson's liability, if any, will not be based upon the conduct of the Union, but upon its own conduct. This is not a situation analogous to a master-servant scenario. Second, it is impossible for the Union to have been "the primary and efficient cause" of any discrimination arising from the Union-Tyson collective bargaining agreement. At best, the Union shares fault with Tyson for the existence of the discriminatory scheme, but could not have been primarily responsible for it when Tyson also contractually bound itself to the collective bargaining agreement and, unlike the Union, undertook to implement the agreement's terms.
2. The Union's Duty of Fair Representation
For Tyson to successfully base its Third-Party Complaint upon the Union's alleged unfair representation of its members, Tyson must have standing to assert this right. The duty of fair representation requires a union "to serve the interests of all members without hostility or discrimination toward any, to exercise its discretion with complete good faith and honesty, and to avoid arbitrary conduct." Vaca v. Sipes, 386 U.S. 171, 177 (1967). This duty arises from the union-employee relationship, Medlin v. Boeing Vertol Co., 620 F.2d 957, 961 (3rd Cir. 1980), and does not impose any obligation upon the employer, Local 6885 v. Am. Postal Workers Union, AFL-CIO, 665 F.2d 1096, 1108-09 (D.C. Cir. 1981). Consequently, Tyson lacks standing to claim that the Union breached its member-owed duty of fair representation. See Medlin, 620 F.2d at 961 n. 4 (doubting that an employer could assert a union's breach of it duty of fair representation); GLI Holding Co. v. Amalgamated Transit Union, No. 87-2144, 1987 WL 55589, at *3 (D.D.C. Oct. 7, 1987) (questioning whether an employer has standing to allege claim for unfair representation).
Even if Tyson had standing to assert an unfair representation claim against the Union, that claim would be time-barred. Such a claim that the Union breached its duty to fairly represent its members in collective bargaining with Tyson is governed by the Labor Management Relations Act, to the exclusion of all related state law. See Welsh v. Gen. Motors Corp., 922 F.2d 287, 294 (6th Cir. 1990); Maynard v. Revere Copper Products, Inc., 773 F.2d 733, 735 (6th Cir. 1985). This cause of action is subject to the six month limitations period of LMRA Section § 10(b), 29 U.S.C. § 160 (b). Maynard, 773 F.2d at 734. This period begins to run "when the claimant discovers, or in the exercise of reasonable diligence should have discovered, the acts constituting the alleged violation." Adkins v. Int'l Union of Electrical, Radio Machine Workers, 769 F.2d 330, 335 (6th Cir. 1985); accord Martin v. Lake County Sewer Co., 269 F.3d 673, 678-79 (6th Cir. 2001).
Plaintiffs claim that the alleged discrimination (in the form of reduced wages) began with their employment on June 11, 1999. Tyson has produced no evidence why this date should not be used as the starting date for the six month limitations period. Further, Tyson has likewise failed to show that Plaintiffs' August 29, 2001 suit — commenced over two years after Plaintiffs' employment began — was timely as to the Union. Thus, Tyson's fair representation claim, even if otherwise cognizable, would be barred by the six month statute of limitations. See Adkins, supra; Ott v. Midland-Ross Corp., 523 F.2d 1367, 1369-70 (6th Cir. 1975).
B. Compulsory Joinder of the Union
Fed.R.Civ.P. 19 governs compulsory joinder. When examining whether joinder should be compelled in a particular case, a court first looks to Rule 19(a) to determine if the absent person is "necessary," so that he should be joined if possible. Keweenaw Bay Indian Community v. Michigan, 11 F.3d 1341, 1345 (6th Cir. 1993). Rule 19(a) describes this inquiry as follows:
Persons to be Joined if Feasible. A person who is subject to service of process and whose joinder will not deprive the court of jurisdiction over the subject matter of the action shall be joined as a party in the action if (1) in the person's absence complete relief cannot be accorded among those already parties, or (2) the person claims an interest relating to the subject of the action and is so situated that the disposition of the action in the person's absence may (i) as a practical matter impair or impede the person's ability to protect that interest or (ii) leave any of the persons already parties subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations by reason of the claimed interest.
Tyson seeks to implicate Rule 19(a)(1) by alleging that complete relief cannot be afforded absent the Union's joinder. (Dkt. #7 at 2-3.) In support of this argument, Tyson claims that an Order ending the allegedly illegal pay discrimination cannot be effective unless it also binds the Union.
Rule 19(a)(1) refers to relief as between the present parties and not relief between a party and the absent person whose joinder is sought. United States v. Arlington, 669 F.2d 925, 929 (4th Cir. 1982); Morgan Guaranty Trust Co. v. Martin, 466 F.2d 593, 598 (7th Cir. 1972); Cleveland-Cliffs Iron Co. v. Chicago N.W. Transp. Co., 581 F. Supp. 1144, 1155 (W.D. Mich. 1984); Boyd v. Diebold, Inc., 97 F.R.D. 720, 722 (E.D. Mich. 1983). Here, complete relief can be afforded between Plaintiffs and Tyson even in the Union's absence. The Court has full power to order equalization of pay rates, which would be both effective and complete as to Plaintiffs and Tyson. Even assuming that the effectiveness of the Court's order depended upon its ability to bind the Union, the Court's declaration would supersede any contrary provision in the collective bargaining agreement "just as a raise in the national minimum wage rate would supersede provisions for lower wages which might exist in collective bargaining agreements." Dunlop v. Beloit College, 411 F. Supp. 398, 401 (W.D. Wisc. 1976); see also Forsberg v. Pacific N.W. Bell Telephone Co., 622 F. Supp. 1147, 1150 (D. Ore. 1985) (In a similar wage rate discrimination case, the court held that "complete relief can be afforded . . . by ordering back pay and other relief found to be appropriate.").
Tyson's citation to McCooe v. Town of Manchester, 101 F.R.D. 339 (D. Conn. 1984), for the proposition that complete relief cannot be afforded without the union is not persuasive. There, the court's Rule 19(a)(1) decision was erroneously based upon the adjudication's effect upon the union rather than the effect of the union's absence upon the present parties. The court explained that "[h]aving negotiated the collective bargaining agreement provision herein challenged . . ., the absent union clearly has an interest in this litigation, and is no less entitled to be heard. Adjudication of plaintiffs claim necessarily will adjudicate the union's right to enforce the contract it has negotiated." Id. at 341. This focus upon the union s interest is appropriate in an inquiry under Rule 19(a)(2)(i), but not in a Rule 19(a)(1) examination. See Fed.R.Civ.P. 19; Arlington, 669 F.2d at 929; Martin, 466 F.2d at 598; Cleveland-Cliffs, 581 F. Supp. at 1155; Boyd, 97 F.R.D. at 722. Thus, McCooe incorrectly evaluated the Rule 19(a)(1) claim before it, and is of little persuasive value. Similarly, Tyson's citation to Reyes v. Missouri-Kansas-Texas R.R. Co., 33 F.R.D. 293 (D. Kan. 1971), offers little persuasive support for its argument, since the Reyes court determined without analysis that the union was "a person whose joinder is needed for just adjudication within the meaning of Rule 19." Id. at 297.
Rule 19(a)(2) likewise fails to mandate compulsory joinder of the Union. Because the Union seeks dismissal of Tyson's third-party complaint and opposes joinder, an analysis of Rule 19(a)(2)(i)'s applicability is not warranted. See United States ex rel. Morongo Band of Mission Indians v. Rose, 34 F.3d 901, 908 (9th Cir. 1995) (third party's voluntary dismissal as a defendant provided "best evidence" that his absence would not impair or impede his ability to protect his interests"). Additionally, given the superceding effect that any equalization order would have on the collective bargaining agreement, see Dunlop, 411 F. Supp. at 401, Rule 19(a)(2)(ii) provides no basis for joinder because Tyson faces no risk of inconsistent obligations. Id. Finally, even if Rule 19(a)(2) provided a justification for joining the Union as a party, Tyson has not sought joinder based upon this provision.
Joinder of the Union, even if appropriate, would be problematic because the Union's interests are not completely aligned with either party. The Union's interest in representing its members would be best served by its alignment as a plaintiff, while its interest in enforcing the contract that it negotiated would be served by making it a defendant. While this divergence of interests would not justify a court's refusal to join the Union, it has caused some uncertainty over how to align a joined union. See, e.g., Forsberg, 622 F. Supp. at 1150 (union joined as a nonaligned party); McCooe, 101 F.R.D. at 341 (court gave union 21 days to voluntarily join suit as a plaintiff or be involuntarily joined as a defendant).
Since the Union is not a necessary party under Rule 19(a), the Union cannot be joined under Rule 19. The Union's Motion is GRANTED, and it is DISMISSED from the present action.
ORDER
Upon Third-Party Defendant United Steelworkers of America's Motion to Dismiss Third-Party Plaintiff's Third-Party Complaint (Dkt. #6) and this Court being otherwise sufficiently advised, IT IS ORDERED that Defendant's Motion is GRANTED. Third-Party Defendant United Steelworkers of America is DISMISSED from this action.