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Elmo Greer & Sons, LLC v. Local 14581 United Steelworkers of America

United States District Court, Sixth Circuit

December 2, 2013

ELMO GREER & SONS, LLC, Plaintiff,
v.
LOCAL 14581 UNITED STEELWORKERS OF AMERICA, AFL-CIO-CLC, et al., Defendants.

MEMORANDUM OPINION & ORDER

AMUL R. THAPAR, District Judge.

Federal labor law treats corporations and labor unions as adults: where the parties to a collective bargaining agreement decide to resolve their disputes in a particular manner, federal courts will not entertain suits brought in violation of their agreement. Elmo Greer & Sons, LLC, sued both an international union and its local chapter for breach of their collective bargaining agreement. But it complied with the contractual remedies for filing suit only as to the local union. Accordingly, the claim against the local union may proceed, but the Court must dismiss the claim against the international union.

BACKGROUND

The Commonwealth of Kentucky hired Elmo Greer & Sons, LLC (the "Company"), to construct a road in Pikeville. R. 1 ¶ 10. Local Number 14581 of the United Steelworkers of America (the "Local Union") represented the employees working on the project. Id. ¶ 3. The Company, the Local Union, and the United Steelworkers International Union (the "International Union") were parties to a collective bargaining agreement (the "Agreement") that prohibited striking. R. 1-1 at 17, 20-21. Nevertheless, the Local Union's President, Gypsy Cantrell-Ratliff, felt that the Company had mistreated a senior employee and ordered a strike. R. 35-2 at 13. The Company sent both the Local Union and the International Union a letter threatening a lawsuit against the Local Union. Id. at 74. Two weeks later, and without further negotiation, the Company filed this action. See R. 1. The Company alleges that both the Local Union and the International Union breached the Agreement, since they are both responsible for the actions of Cantrell-Ratliff. See R. 1 ¶¶ 29-36. After discovery, the parties moved for summary judgment. R. 35; R. 37. "Summary judgment is proper where there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law." Peterson v. Johnson, 714 F.3d 905, 910 (6th Cir. 2013).

The Company contends that it is entitled to summary judgment on three points: (1) that Cantrell-Ratliff violated the Agreement by ordering a strike; (2) that Cantrell-Ratliff acted as an agent of the Local Union; and (3) that Cantrell-Ratliff acted as an agent of the International Union. See R. 35-1 at 7. Notably, the defendants do not defend the legality of the strike, nor do they dispute that Cantrell-Ratliff acted as an agent of the Local Union. See R. 37 at 6-13. Instead, the defendants argue that the Agreement bars the Company's claim, because it provides for mandatory alternative modes of dispute resolution, with which the Company failed to comply. See id. at 6-9. In the alternative, they argue that the Court should dismiss the International Union, as there is no evidence Cantrell-Ratliff acted on its behalf. Id. at 9-13.

DISCUSSION

Section 301 of the Labor Management Relations Act confers federal jurisdiction over suits alleging the breach of a collective bargaining agreement. 29 U.S.C. § 185(a). That section also invites federal courts to craft the substantive law that governs such disputes. Textile Workers Union of Am. v. Lincoln Mills of Ala., 353 U.S. 448, 456-57 (1957). Accordingly, federal courts have created a body of federal common law that controls the interpretation of collective bargaining agreements. Bowen v. U.S. Postal Service, 459 U.S. 212, 224-25 (1983) ("In defining the relationships created by [collective bargaining agreements], the Court has applied an evolving federal common law grounded in national labor policy."). Because the defendants contend that the Agreement bars the Company's suit, the Court must construe the contract to determine whether this case may proceed in federal court.

I. The Company's Claim Against the Local Union May Proceed, but the Agreement Bars the Company's Claim Against the International Union

A party to a collective bargaining agreement must exhaust its contractual remedies before filing a lawsuit. United Ass'n of Journeymen, Local No. 577 v. Ross Bros. Constr. Co., 191 F.3d 714, 717 (6th Cir. 1999). If a party fails to pursue such remedies, then it waives its right to enforce the agreement in federal court. Id.; see 29 U.S.C. § 173(d) ("Final adjustment by a method agreed upon by the parties is declared to be the desirable method for settlement of grievance disputes arising over the application or interpretation of an existing collective-bargaining agreement."). The defendants argue that the Company waived its right to file this suit, because it violated two sections of the Agreement-Articles 14 and 18. For the reasons explained below, the Company satisfied the Agreement's requirements regarding its claim against the Local Union but forfeited its right to sue the International Union.

The Local Union: The Local Union first contends that the Court must dismiss the Company's claim because the Company violated Article 14. Article 14 provides that:

[N]either party shall bring... any court or other legal or administrative action against the other until the... claim... shall have been brought to the attention of the Party against whom it shall be made and [that party], after actual notice of [the claim], shall fail within a reasonable time to take steps to correct the cause or circumstances giving rise to such... claim.

R. 1-1 at 14.

The day after the strike, the Company sent the Local Union a letter that clearly stated its intent to sue the Local Union. R. 35-2 at 76. Two weeks later, the Company filed this lawsuit. The Local Union does not contend that the notice was inadequate or that two weeks was not a "reasonable time" within the meaning of Article 14. Instead, the Local Union argues that Article 14 requires "genuine pre-litigation settlement efforts, " R. 37 at 7, which the Company did not undertake.

There is simply no textual basis in Article 14 for such a requirement. Article 14 requires only that the non-breaching party provide the breaching party with notice and an opportunity to cure the breach, and nothing more. R. 1-1 at 14. Because the Local Union does not dispute that ...


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