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United Steel v. LLFlex, LLC

United States District Court, W.D. Kentucky, Louisville Division

March 28, 2019

UNITED STEEL, PAPER AND RUBBER, MANUFACTURING, ENERGY, ALLIED-INDUSTRIAL AND SERVICE WORKERS INTERNATIONAL UNION, AFL-CIO-CLC AND ITS LOCAL NO. 1693 PLAINTIFF
v.
LLFLEX, LLC d/b/a ORACLE PACKAGING, INC. DEFENDANT

          MEMORANDUM OPINION AND ORDER

          GREG N. STIVERS, CHIEF JUDGE UNITED STATES DISTRICT COURT

         This matter is before the Court on Defendant's Motion to Dismiss (DN 5). The motion is ripe. For the reasons below, the motion is GRANTED.

         I. BACKGROUND

         Defendant LLFlex, LLC (“Company”) is an Illinois corporation which owns and operates a facility in Louisville, Kentucky, with employees represented by Plaintiff United Steel, Paper and Rubber, Manufacturing, Energy, Allied-Industrial and Service Workers International Union, AFL-CIO-CLC and Its Local No. 1693 (“Union”), a labor organization under the Labor Management Relations Act of 1947, 29 U.S.C. §§ 141-197. (Compl. ¶¶ 3-4, DN 1). The Company and the Union are parties to a collective bargaining agreement (“CBA”) that covers terms and conditions of employment for certain employees. (Compl. ¶ 5; Def.'s Mot. Dismiss Ex. 1, at 2, DN 5-1 [hereinafter CBA]). The Union alleges the Company violated the CBA in January 2018 when it altered retiree healthcare plans to require affected retirees to pay a share of the premium costs related to those benefits. (Compl. ¶ 7).

         The CBA provides for a three-step grievance procedure followed by final and binding arbitration. (Compl. ¶ 8). In December 2017, the Union filed a grievance protesting the Company's decision to shift premium costs to retirees as a violation of the CBA. (Compl. ¶ 9). When there was no resolution through the grievance procedure, the Union moved the grievance to arbitration, but the Company refused to arbitrate. (Compl. ¶ 9-11).

         The Union brought this action to have the grievance at issue deemed arbitrable and to have the Company ordered to arbitrate the grievance pursuant to the procedures described in Article XV of the CBA. (Compl. 3). The Company now moves to dismiss the Union's Complaint for lack of standing and for failing to state a claim. (Def.'s Mot. Dismiss 2-3, 8, DN 5). The Union contends that it does have standing to bring these claims on behalf of the affected retirees, that the presumption of arbitrability directs the Court to find the grievance arbitrable, and that the language of the CBA is broad enough to include retirees. (Pl.'s Resp. Def.'s Mot. Dismiss 2, 10, 14, DN 13 [hereinafter Pl.'s Resp.]).

         II. JURISDICTION

         This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1331 and 29 U.S.C. § 185(c).

         III. STANDARD OF REVIEW

         Dismissing a complaint pursuant to Fed.R.Civ.P. 12(b)(1) is proper when the Court determines it lacks subject matter jurisdiction over a claim, including when a plaintiff lacks standing. Ward v. Alternative Health Delivery Sys., Inc., 261 F.3d 624, 626 (6th Cir. 2001) (standing is “thought of as a ‘jurisdictional' matter, and a plaintiff's lack of standing is said to deprive a court of jurisdiction.”). Motions to dismiss for lack of subject matter jurisdiction fall into two categories: facial attacks and factual attacks. United States v. Ritchie, 15 F.3d 592, 598 (6th Cir. 1994). Facial attacks challenge subject matter jurisdiction as to the sufficiency of the pleadings. For facial attacks courts will consider the material allegations in the complaint as true and construe them in the light most favorable to the nonmoving party. Id. Factual attacks challenge subject matter jurisdiction as to the facts alleged in the pleadings, in which case courts weigh conflicting evidence and resolve factual disputes in determining whether there is jurisdiction. Id.

         Upon a motion to dismiss for failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6), a court “must construe the complaint in the light most favorable to plaintiff[], accept all well-pled factual allegations as true” and determine whether the “complaint states a plausible claim for relief . . . .” League of United Latin Am. Citizens v. Bredesen, 500 F.3d 523, 527 (6th Cir. 2007) (citation omitted); Wingo v. Tenn. Dep't of Corr., 499 Fed.Appx. 453, 454 (6th Cir. 2012) (citation omitted). To survive a motion to dismiss, the pleading “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 677 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Mere statements of legal conclusions are insufficient for avoiding a 12(b)(6) motion to dismiss. Id. at 678. A claim is plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” In re Harchar, 694 F.3d 639, 644 (6th Cir. 2012) (internal quotation marks omitted) (quoting Iqbal, 556 U.S. at 677).

         IV. DISCUSSION

         A. Standing

         The Company challenges the Union's complaint on the sufficiency of its pleadings, which is a facial attack. Accordingly, the Court will consider the Union's factual allegations as true in deciding whether it has standing to bring this claim on behalf of retirees. See Ritchie, 15 F.3d at 598.

         To have standing under Article III of the U.S. Constitution, a plaintiff must suffer an injury that is fairly traceable to the challenged action, for which a favorable decision from the court could provide redress. Lujan v. Defenders of Wildlife,504 U.S. 555, 560-61 (1992). The Sixth Circuit has held that “where a union and company bargain for retirees' benefits and include the benefits in their contract, the union has standing to represent the retirees in any dispute ...


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