Opinion
Civ. No. 01-cv-138 (WGB)
July 2, 2002
James M. Mets, Esq., UFFELMAN RODGERS KLEINLE METS, Morristown, N.J., Attorneys for Plaintiff.
Gregory L. Hawthorne, Esq., East Brunswick, N.J., Attorneys for Defendants.
MEMORANDUM OPINION
Before the Court are Defendants' Motion to Disqualify Counsel, Plaintiff's cross-motion to remand this matter to the Superior Court of New Jersey, Union County, and Plaintiff's cross-motion for fees and costs. Plaintiff's cross-motion is premised on the argument that because his Complaint contains only tort claims and does not implicate any questions of federal law, this Court lacks subject matter jurisdiction. For the following reasons the Court agrees with Plaintiff, and orders that this matter be remanded to the Superior Court of New Jersey, Union County.
Had Plaintiff's counsel been properly diligent, he would have moved to remand this matter over one year ago, at the time his action was removed by Defendants. Because he failed to do so, it would be inappropriate for the Court to hold Defendants responsible for the $3,800 in attorney's fees Plaintiff has generated while prosecuting his litigation in this Court. Accordingly, Plaintiff's request for attorneys fees and costs is denied. Additionally, because this matter is hereby remanded, the Court need not address the merits of Defendants' motion to disqualify.
I. Background
Plaintiff, the incumbent president of Teamster Local 97, was engaged in a campaign to be re-elected president of Local 97. Defendants were members of a slate of candidates running against Plaintiff. According to Plaintiff, Defendants circulated a campaign leaflet defaming Plaintiff (the leaflet falsely implied Plaintiff had taken a payoff from the parties' employer). Upon seeing the allegedly tortious leaflet, Plaintiff brought a three-count state court complaint containing causes of action for defamation, invasion of privacy, and conspiracy to defame. Defendants filed an answer and counter-claim in state court, alleging that Plaintiff's suit was itself impermissible retaliation that violated Defendants' rights as guaranteed by Title I of the Labor Management Reporting and Disclosure Act ("LMRDA"), 29 U.S.C. § 411 et seq.On January 10, 2001, Defendants removed Plaintiff's action to this Court on federal question grounds. Defendants' notice of removal asserts that Section 102 of the LMRDA confers jurisdiction on this Court to hear actions brought by union members for violations of Title I of the LMRDA.
II. Analysis
Plaintiff has challenged Defendants' removal of this action on subject matter jurisdiction grounds. Specifically, Plaintiff argues that this Court lacks federal question jurisdiction over his action, because his Complaint contains only state law claims for defamation, invasion of privacy, and conspiracy to defame. By way of response, Defendants contend that because their answer and counter-claim are based on Title I of the LMRDA, this Court has federal question jurisdiction over the entire dispute. Consequently, Defendants argue that removal pursuant to 28 U.S.C. § 1441(b) was appropriate. In the alternative, Defendants argue that Federal labor law preempts Plaintiff's state law claims.
In addition to his subject matter jurisdiction challenge, Plaintiff has argued that this matter should be remanded on procedural grounds, because of Defendants' failure to remove this matter within 30 days of receipt of service, as directed by 28 U.S.C. § 1446(b). Although Defendants' removal was indeed untimely, Plaintiff's argument overlooks the clear language of 28 U.S.C. § 1447(c), which requires that any motions to remand for procedural defects must be brought within 30 days of removal. Because Plaintiff did not move to remand on the basis of the procedural defect until more than one year after removal, Plaintiff's argument utterly fails.
Upon a motion to remand, the removing party bears the burden of demonstrating that removal was proper. Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990). The removing party thus bears the burden of proving that jurisdiction is proper in federal court. Id. Further, removal statutes are strictly construed in favor of remand.Steel Valley Auth. v. Union Switch Signal Div., 809 F.2d 1006, 1010 (3d Cir. 1987).
Because the parties are non-diverse and removal jurisdiction is predicated on the existence of original federal jurisdiction, the first question that must be addressed is whether the complaint pleads a federal cause of action under the well-pleaded complaint rule. Louisville Nashville Railroad v. Mottley, 211 U.S. 149 (1918).
Under the "well-pleaded complaint rule," removal is appropriate only where a federal question appears on the face of the complaint. Franchise Tax Bd. of the State of Cal. v. Construction Laborers Vacation Trust for S. Cal., 463 U.S. 1, 9-12 (1983); accord In re U.S. Healthcare, Inc., 193 F.3d 151, 160 (3d Cir. 1999); Joyce v. RJR Nabisco Holdings Corp., 126 F.3d 166, 171 (3d Cir. 1997); Dukes v. U.S. Healthcare, 57 F.3d 350, 353 (3d Cir. 1995). "[W]here a plaintiff's complaint on its face states only state law causes of action, the fact that issues of federal law may be involved, as in the nature of a defense, will not suffice to create federal question jurisdiction." Carrington v. RCA Global Communications, Inc., 762 F. Supp. 632, 636 (D.N.J. 1991). This rule was designed to make the plaintiff "master of the claim." Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987).
In keeping with the preceding principles, it is also well settled that:
the federal question must be disclosed upon the face of the complaint, unaided by the answer or by the petition for removal. A right or immunity created by the Constitution or laws of the United States must be an element, and an essential one, of the plaintiff's cause of action . . . removability cannot be created by defendant pleading a counter-claim presenting a federal question.Takeda v. Northwestern National Life Insurance Co., 765 F.2d 815, 822 (5th Cir. 1985) (internal quotations and citations omitted);See also Shannon v. Sannon, 965 F.2d 542, 545 (7th Cir. 1992).
For purposes of determining this Court's jurisdiction, it is irrelevant whether a defendant's answer and counter-claims contain federal questions. Instead, the relevant inquiry is whether some federal question is present solely on the face of plaintiff's Complaint. If no federal question is present, the Court must in most circumstances remand Plaintiff's action.
Although a court must remand in most circumstances where a federal question is not present on the face of the complaint, a narrow exception to the rule does exist. Congress may "completely pre-empt" an area of law, with the result that a claim which falls within the area is "`necessarily federal in character.'" In re U.S. Healthcare, 193 F.3d at 160; Dukes, 57 F.3d at 354; Joyce, 126 F.3d at 171. Complete preemption is appropriate when federal law so completely preempts a cause of action that state law is "entirely displaced by federal law." Joyce, 126 F.3d at 171. When complete preemption occurs, the complaint need not satisfy the well-pleaded complaint rule. Id.
Under settled Third Circuit law, the doctrine of complete preemption applies only when two circumstances are present: (1) when the enforcement provisions of a federal statute create a federal cause of action vindicating the same interest that the plaintiff's cause of action seeks to vindicate; and (2) when there is affirmative evidence of a congressional intent to permit removal despite the plaintiff's exclusive reliance on state law. Allstate Ins. Co. v. 65 Sec. Plan, 879 F.2d 90, 93 (3d Cir. 1989); Goepel v. National Postal Mail Handlers Union, 36 F.3d 306, 311 (3d Cir. 1994).
In opposition to Plaintiff's jurisdictional arguments in support of remand, Defendants have provided the Court with the sum total of one-and-a-half pages of briefing. Before advancing any of their lightly supported arguments, Defendants note that Plaintiff has conceded that:
1. The parties are all members of Local 97;
2. Plaintiff is the President of the Union; and
3. Plaintiff's claim arises under conduct with regard to a Union election campaign.
(Defendants' Brief, p. 2.) Presumably based on the foregoing undisputed facts, Defendants assert that:
issues regarding Union member's Freedom of Speech, rights of Union members and officials and Union elections are completely regulated by Federal Law. This case cannot be determined without interpretation of the Federal statutes. Accordingly, Plaintiff's complaint, though avoiding allegations of Federal jurisdiction, arises solely under the Federal statutes regulating Unions.
(Defendants' Brief, p. 2.) Defendants' unsupported assertions aside, mindful that the removing party bears the burden of proving that jurisdiction is proper in federal court, Boyer, 913 F.2d at 111, Defendants have completely failed to demonstrate which "federal statutes regulating Unions" Plaintiff's complaint "arises solely under."
While it may be true that Congress has pre-empted state law causes of action interpreting federal statutes with regard to labor unions, and while there are instances where state law claims are expressly preempted by federal statutes, Defendants have failed to assert which federal statutes preempt Plaintiff's state law tort claims in this case. Even though Defendants have cited to Newton v. Tavani, 962 F. Supp. 45, (D.N.J. 1997), for the correct proposition that "where Congress provides specifically that a particular area of the law is `necessarily federal in character,' a case may be preempted completely from the well-pleaded complaint rule, and federal jurisdiction may arise by virtue of such a federal defense to a state law cause of action," Defendants have provided no evidence that Congress specifically provided that state law defamation actions should be considered `necessarily federal in character.' See,Box Tree South, LTD. v. Bitterman, 873 F. Supp. 833, 840-41 (S.D.N.Y. 1995) (rejecting argument that state defamation law is totally preempted in context of labor disputes).
Even for alleged defamation occurring during a Union election, Defendants have provided no authority for the proposition that such factual circumstances transform Plaintiff's common law tort claims into federal questions. In fact, courts in New Jersey and elsewhere have allowed tort claims to proceed at the state level, even though they arose in a labor setting, and even though recovery on the state law tort claims might ultimately have be preempted by Federal defenses. See, e.g.,Dzwonar v. McDevitt, 348 N.J. Super. 164, 174 (App.Div. 2002) (Although CEPA claim was preempted by LMRDA, Invasion of Privacy tort claim was not); Box Tree South, LTD., 873 F. Supp. At 836 (Defamation claims arising out of strike not completely preempted); Clark v. Esser, 907 F. Supp. 1069, 1080 (E.D.Mich. 1995) (Federal LMRDA action commenced after conclusion of separate state court defamation action).
Although Defendants do not say so, the obvious federal statute to consider for purposes of their argument would be the LMRDA. Having reviewed the relevant case law, however, the Court finds that at best the LMRDA presents a preemptive federal defense to state law causes of action, which is not sufficient to sustain removal. See generally Box Tree South; Esser; Dzwonar; Morris v. Scardelletti, 1995 WL 120224 (E.D.Pa. Mar. 14, 1995) (LMRDA will not estop prosecution of lawsuit with reasonable basis, even if initiated as retaliation). "Federal preemption is ordinarily asserted as a defense to the allegations of a complaint and therefore does not usually form the basis for removal. State courts are competent to determine whether state law has been preempted by federal law and they must be permitted to perform that function in cases brought before them." Vail v. Pan Am Corp., 752 F. Supp. 648, 655 (D.N.J. 1990) (internal citations omitted.) Because Defendants have not provided the Court with any evidence that Congress intended for the LMRDA to completely preempt state defamation law in the labor context, the mere fact that they could assert a preemptive LMRDA defense before the state court is not sufficient to support removal.
Defendants seem to fundamentally misapprehend the oft-confused distinction between a federal defense that preempts recovery in state court on a particular claim, and complete federal preemption of a cause of action that requires removal of an entire action from the state courts. See Thomas v. Hanley, 1997 WL 563402, n. 3 (E.D.Pa. Sept. 2, 1997) ("Although preemption and complete preemption are two entirely different concepts, they are easily confused.") While the LMRDA can sometimes act as a federal defense and preempt a plaintiff's recovery on an otherwise valid state court tort claim, there is no basis for the Court to conclude that Congress intended the LMRDA to completely preempt the state courts from hearing defamation claims that arise in a Union setting. Absent such evidence of Congressional intent, the presence of an LMRDA defense or counter-claim can not form a sufficient basis to justify removal of this action.
Trying another approach, Defendants have asserted without support that "this matter cannot be litigated without interpretation of the collective bargaining agreement as well as the provision of the [LMRDA]." (Defs. Brief, p. 3.) Again Defendants have failed to support their bald assertion by pointing to what portion of the collective bargaining agreement ("CBA") would need to be interpreted. Even though Section 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185, does completely preempt state law claims that are "substantially dependent upon an analysis or the meaning of the terms of a labor agreement governed by section 301, or is inextricably intertwined with the consideration of the terms of the agreement," there is no evidence that Plaintiff's action even impacts upon the collective bargaining agreement. See Phillips v. Selig, 157 F. Supp.2d 419, 426 (E.D.Pa. 2001), citing Lingle v. Norge Division of Magic Chef, Inc., 486 U.S. 399, 405-6 (1988); Espinosa v. Continental Airlines, 80 F. Supp.2d 297, 302 (D.N.J. 2000); cf. Kozlowsky v. K-Mart Corp., 1990 WL 90537 (D.N.J. May 25, 1990) (under facts of case, resolution of state law defamation claim required interpretation of CBA, therefore § 301 was found to preempt the action).
Rather than an action that is intertwined with a collective bargaining agreement, Plaintiff's action appears to be a common law tort action that happens to arise out of a Union election; as has been demonstrated in numerous other courts, such claims are not completely preempted if they do not require interpretation of the CBA. See Phillips, 157 F. Supp.2d at 427-28 (disparaging statements alleging plaintiff's various ethical violations and general incompetence do not require interpretation of CBA, and are unrelated to its terms.) As the Phillips Court guided, "claims that are independent of a collective bargaining agreement, even if they are between employees and employers, are not removable. Additionally, `when the meaning of contract terms is not the subject of dispute, the bare fact that a collective-bargaining agreement will be consulted in the course of state-law litigation plainly does not require the claim to be extinguished.'" Phillips, 157 F. Supp.2d at 426 (internal citation omitted), quoting Beidelman v. Stroh Brewery Co., 182 F.3d 225, 232 (3d Cir. 1999).
Defendants' final argument is similarly unavailing. Defendants quoteLocal No. 82 v. Crowley, 468 U.S. 1224 (1984), for the proposition that "any person whose rights secured by the provisions of the [LMRDA] have been infringed by any violation of this title may bring a civil action in a district court of the United States for such relief (including injunctions) as may be appropriate." While Defendants are entirely correct in asserting their right to commence an action in federal court, there is no basis in law for their attempt to remove a state law tort action by appending an LMRDA counter-claim to it. As demonstrated inClark v. Esser, 907 F. Supp. 1069, 1080 (E.D.Mich. 1995), the appropriate procedure would be for Defendants to lodge their LMRDA claim as an affirmative defense in the state court, or in the alternative commence a separate LMRDA action in the federal court. The appropriate procedure is not, as Defendants' suggest, to commence a removal and deprive Plaintiff of his chosen forum for his state law tort claims.
III. Conclusion
Defendants are correct that they are entitled to assert their own claims against Plaintiff under the LMRDA, and that they are entitled to do so in the United States District Court. To the extent that Defendants have attempted to remove Plaintiff's action from state court on that basis, however, they are in error. Because Plaintiff does not seek relief under the LMRDA, and because Defendants have failed to demonstrate that this Court will be called upon to interpret the collective bargaining agreement between the parties, the Court lacks jurisdiction over this matter. Accordingly, Plaintiff is entitled to remand.
For the preceding reasons, Plaintiff's cross-motion to remand this matter to the Superior Court of New Jersey, Union County is granted. Plaintiff's application for costs and fees is denied. The Court will not reach the merits of Defendants' motion to disqualify Plaintiff's counsel; that matter is left for the Superior Court's review.
An appropriate Order follows.