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USCA1 Opinion
January 4, 1993 UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
_____________________
No. 92-1658
MIGUEL ANGEL CHAPARRO-FEBUS, ET AL.,
Plaintiffs, Appellants,
v.
INTERNATIONAL LONGSHOREMEN ASSOCIATION,
LOCAL 1575, ET AL.,
Defendants, Appellees.
_____________________
ERRATA SHEET
The opinion of this Court issued on December 31, 1992, is amended
as follows:
On page 3, line 2 of first full paragraph, replace
"independence" with "independent".
December 31, 1992 UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
____________________
No. 92-1658
MIGUEL ANGEL CHAPARRO-FEBUS, ET AL.,
Plaintiffs, Appellants,
v.
INTERNATIONAL LONGSHOREMEN ASSOCIATION,
LOCAL 1575, ET AL.,
Defendants, Appellees.
____________________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO
[Hon. Juan M. Perez-Gimenez, U.S. District Judge]
___________________
____________________
Before
Stahl, Circuit Judge,
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Campbell, Senior Circuit Judge,
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and Skinner,* Senior District Judge.
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Emmalind Garcia Garcia for appellants.
______________________
Jose G. Fagot-Diaz with whom Ramirez & Ramirez was on brief for
__________________ __________________
appellee Puerto Rico Maritime Shipping Authority.
Rafael Cuevas Kuinlam with whom Cuevas Kuinlam & Bermudez was on
_____________________ __________________________
brief for appellee Puerto Rico Marine Management, Inc.
Nicolas Delgado Figueroa for appellee International Longshoremen
________________________
Association, Local 1575.
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____________________
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*Of the District of Massachusetts, sitting by designation.
CAMPBELL, Senior Circuit Judge. Plaintiffs,
_______________________
appellants are sixteen mechanics employed by Puerto Rico
Marine Management, Inc. ("PRMMI") who are members of the
International Longshoremen Association, Local 1575 ("Local
1575"). They sued PRMMI and Local 1575, under section 301 of
the Labor Management Relations Act ("LMRA"), 29 U.S.C. 185,
in the United States District Court for the District of
Puerto Rico alleging that PRMMI had broken its collective
bargaining agreement with Local 1575 ("Agreement"); that
Local 1575 had breached its duty of fair representation by
arbitrarily agreeing to changes which violated their
seniority rights under the Agreement; and that Local 1575
further breached its duty of fair representation by refusing
to submit plaintiffs' claims against PRMMI to the internal
grievance procedure and arbitration established by the
Agreement. The Puerto Rico Maritime Shipping Authority
("PRMSA") was also named as a defendant and alleged to be
plaintiffs' employer. The district court dismissed the claim
against PRMSA for lack of subject matter jurisdiction, denied
plaintiffs' request for a preliminary injunction, and granted
summary judgment in favor of PRMMI and Local 1575. We
affirm.
I.
I.
PRMSA, which is also known as "Autoridad de las
Navieras" or simply "Navieras," is a government agency
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created by the Commonwealth of Puerto Rico in 1974 to
facilitate maritime transportation of cargo and passengers to
and from Puerto Rico. 23 L.P.R.A. 3051, et seq. To
________
effectuate this purpose, Puerto Rico purchased several
shipping companies and authorized PRMSA to enter into
contracts with private enterprises for the management of its
operations. Id. 3055. PRMSA was additionally authorized
___
to create subsidiary corporations. Id. 3056.
___
In 1976, PRMSA entered into a contract with PRMMI,
then an independent Delaware corporation, to manage
longshoring services for it. Two years later PRMSA acquired
PRMMI and converted it into a subsidiary of PRMSA. In March
of 1985, PRMSA sold its stock in PRMMI to a private
corporation, TNT Containerships, Inc. At that time, PRMSA
and PRMMI entered into a contract giving PRMMI exclusive
control over the daily longshoring operations.1
PRMMI began to encounter serious economic problems
in 1990. At that time PRMMI provided two different systems
for loading and unloading vessels: the ro-ro system, which
operates from small ships with ramps; and the lo-lo system,
which operates from larger ships by means of cranes. Local
1575 then, as now, represented the employees managed by
PRMMI, under a collective bargaining agreement between the
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1. The relationship between PRMSA and PRMMI is further
described in our opinion, Rodriguez-Garcia v. Davila, 904
________________ ______
F.2d 90, 93 (1st Cir. 1990).
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two parties. PRMMI notified Local 1575 of its intention to
eliminate the ro-ro fleet. A series of bargaining meetings
between PRMMI and Local 1575 were held between April and June
of 1990. Eventually a stipulation was signed in which PRMMI
agreed not to carry out any more reductions during the
remaining life of the Agreement and to give work preference
to employees with more seniority in accordance with the
seniority clause of the Agreement and Act No. 80 of 1976, 29
L.P.R.A. 185.2
Article I C of the Agreement, which governs
seniority rights, states the following:
Seniority is defined as the continuous
time of service in the Company by
department (Warehouse and Car Division,
Maintenance, Marine) from the date on
which the person began as an employee in
said Company within the contracting unit,
provided that the employee is efficient
and complies with the conditions of this
Agreement and the rules of the Company
for which he works, and except in the
Marine Department that seniority shall be
by gangs and not by the seniority of the
employee within the contracting unit and
in the Maintenance Department that
_________________________________________
seniority shall be by classification
_________________________________________
within the same department. (emphasis
____________________________
added).
Paragraph 96 of Article VI, entitled "General Conditions," is
an administrative provision which also mentions seniority:
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2. Act No. 80 requires reductions in workforce to be made
according to seniority order by occupational classification.
29 L.P.R.A. 185c.
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PRMMI shall keep separate the LO/LO and
RO/RO seniorities, and in the receipt and
dispatch may use a RO/RO or LO/LO line to
receive or dispatch when the job so
warrants it. In the maintenance area,
the employer shall keep said area
separate, except that he may pass work
from one area to another, provided that
the situation so warrants.3
Pursuant to Paragraph 96, work as well as equipment in the
maintenance department have in the past been transferred from
lo-lo to ro-ro.
PRMMI maintains two separate seniority lists for
lo-lo and ro-ro employees. These lists determine which
employees are called to work on a daily basis. Each morning,
supervisors call the personnel from each list in the order in
which they appear on the list. Regular employees, who are
guaranteed forty hours of work each week, are called first.
If more personnel is needed or if some of the regulars are
absent, substitute employees, who must appear each morning
and wait to be informed if there is available work, are
called.
On July 26, 1990, in response to the sharp decline
in work at the ro-ro area and in accordance with its
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3. There is some confusion as to whether this clause is
contained in paragraph 96 or paragraph 94 of Article VI. An
exhibit admitted during the preliminary injunction hearing
identifies the material as paragraph 94 and contains minor
variations in the English translation. The district court,
however, appears to have adopted a previously provided
certified translation of the material, which identified it as
paragraph 96. For ease and clarity, we too will refer to the
clause as paragraph 96.
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stipulation with Local 1575, PRMMI examined the seniority of
its regular mechanics in the maintenance department. The
fifteen mechanics with the highest seniority, without regard
to whether the mechanics were lo-lo or ro-ro employees, were
kept as regular employees. The rest went into a list of
substitute employees. Due to the changes, three ro-ro
mechanics in the maintenance department were transferred to
work the lo-lo list as regular lo-lo mechanics in the
maintenance department.
Plaintiffs are sixteen lo-lo mechanics in the
maintenance department. As a result of the changes, three
plaintiffs who had been lo-lo regular employees were
downgraded to substitute employees. Likewise, those
plaintiffs who were substitute mechanics were downgraded by
the formerly-regular plaintiffs who became substitutes.
Irrespective of the changes, all plaintiffs have continued to
work full time albeit occasionally working night shifts
and to make the same amount of money as they did before their
status was altered .
Plaintiffs contend that on July 27, 1990, they met
with a Local 1575 delegate and a PRMMI official, who informed
them that the union and company had signed a stipulation
agreeing to the modifications. On August 1, plaintiff
Chaparro Febus spoke with the union's vice-president, who
told Chaparro Febus there was nothing he could do. The next
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day, plaintiffs contend that they asked to see Local 1575's
president in order to persuade him to file a grievance
against the company, and that the president refused to see
them. Plaintiffs filed a written complaint with the union on
August 3. On August 27, plaintiffs again requested in
writing that a grievance be filed against PRMMI. The
president of Local 1575 informed plaintiffs in a letter dated
September 5, 1990, that their complaint would be taken before
the Grievance Committee.
Plaintiffs' grievances, however, were not taken to
arbitration. On January 20, 1991, plaintiffs filed the
present action against PRMMI, Local 1575, and PRMSA. The
district court dismissed the action against PRMSA for lack of
subject matter jurisdiction. It subsequently denied a
preliminary injunction and granted PRMMI's and Local 1575's
motion to dismiss, which the court treated as a motion for
summary judgment. This appeal followed.
II.
II.
A. Subject matter jurisdiction over PRMSA
______________________________________
The district court dismissed plaintiffs' 301 complaint
against PRMSA for lack of subject matter jurisdiction because
PRMSA, as a political subdivision of the Commonwealth of
Puerto Rico, is specifically excluded from the term
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"employer" as defined by 29 U.S.C. 152(2).4 Section
152(2) of the LMRA provides in pertinent part the following:
The term 'employer' includes any person
acting as an agent or an employer,
directly or indirectly, but shall not
include the United States or any wholly
owned Government corporation, or any
Federal Reserve Bank, or any State or
political subdivision thereof . . . .
29 U.S.C. 152(2).
"Political subdivisions" within the meaning of
section 152(2) are "entities that are either (1) created
directly by the state, so as to constitute departments or
administrative arms of the government, or (2) administered by
individuals who are responsible to public officials or to the
general electorate." NLRB v. Natural Gas Util. Dist. of
____ ____________________________
Hawkins County, 402 U.S. 600, 604-05 (1971). PRMSA, as a
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"public corporation and governmental instrumentality of the
Commonwealth of Puerto Rico" that is administered by
officials who are directly responsible to the Legislature and
the Governor, 29 L.P.R.A. 3054, meets either test. As this
____________________
4. Although the district court expressly ruled after hearing
oral arguments that it lacked subject matter jurisdiction
over PRMSA, the deputy clerk mistakenly issued a judgment
dismissing the complaint as to PRMSA for lack of in personam
jurisdiction. The district court subsequently failed to rule
on PRMSA's Rule 60(a) motion to correct judgment.
Irrespective of the district court's failure to correct the
clerical error, a party's objection to subject matter
jurisdiction can be raised at any time, including on appeal.
E.g., Hallerman v. Hoffman, 966 F.2d 45, 47 (1st Cir. 1992).
____ _________ _______
We therefore address PRMSA's contentions with respect to
subject matter jurisdiction.
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court has noted in dicta in the past, "it cannot be seriously
disputed that PRMSA is a 'political subdivision' excluded
from the definition of employer under 29 U.S.C. 152(2)."
Puerto Rico Marine Management, Inc. v. International
_________________________________________ _____________
Longshoremen's Ass'n, AFL-CIO, 540 F.2d 24, 25 (1st Cir.
______________________________
1976).
Plaintiffs raise several arguments in an attempt to
avoid this result. In essence, plaintiffs contends that
under guarantor, successor, or alter ego theories, PRMSA is
their employer. Plaintiff's arguments, however, cannot
overcome the simple fact that PRMSA, being a political
subdivision of the Commonwealth of Puerto Rico, is not an
employer within the meaning of section 152(2). This court,
therefore, has no subject matter jurisdiction over an action
under 301 of the LMRA, 29 U.S.C. 1851, against PRMSA.
In a last ditch effort to avoid this result,
plaintiffs contend that the district court erred by
dismissing the complaint against PRMSA without allowing an
amendment to include PRMSA as a pendent party. Plaintiffs,
however, failed to make this request before the district
court. The issue has accordingly been waived. E.g., Boston
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Celtics Ltd. Partnership v. Shaw, 908 F.2d 1041, 1045 (1st
________________________ ____
Cir. 1990); Johnston v. Holiday Inns, Inc., 595 F.2d 890, 894
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(1st Cir. 1979).
B. Duty of Fair Representation
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In a hybrid suit for breach of contract/breach of
duty of fair representation under section 301 of the LMRA, 29
U.S.C. 185, a plaintiff must prove both that the employer
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broke the collective bargaining agreement and that the union
breached its duty of fair representation, in order to recover
against either the employer or the union. DelCostello v.
___________
International Brotherhood of Teamsters, 462 U.S. 151, 165
________________________________________
(1983); Hines v. Anchor Motor Freight, Inc., 424 U.S. 554,
_____ ___________________________
570-71 (1976). A union breaches its duty of fair
representation only when it engages in arbitrary,
discriminatory, or bad faith conduct. Air Line Pilots Ass'n,
______________________
Int'l v. O'Neill, 111 S. Ct. 1127, 1134-35 (1991); Vaca v.
_____ _______ ____
Sipes, 386 U.S. 171, 191 (1967).
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In the present case, plaintiffs have failed to
create a genuine issue of material fact as to whether Local
1575 acted in an arbitrary, discriminatory, or bad faith
manner. All that appears is that Local 1575, faced with the
possibility of layoffs of its member-employees, entered into
a stipulation with PRMMI based upon a perfectly reasonable
interpretation of the provisions of the Agreement. The
stipulation prohibited the layoff of any additional employees
for the life of the Agreement, while at the same time
guaranteeing that any changes would be made in accordance
with the seniority of employees as defined in Article I, C
of the Agreement. This section states that "in the
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Maintenance Department . . . seniority shall be by
classification within the same department." Thus, under the
plain language of Article I, C, seniority is governed by
classification (i.e., mechanic) within departments, and not
by lo-lo or ro-ro designation. Local 1575 understandably
interpreted Article VI, paragraph 96, which appears under
the heading of "General Conditions" and requires PRMMI to
keep separate lo-lo and ro-ro seniorities, as an operational
provision only.
As we say, this seems an entirely plausible
interpretation of the Agreement. Even if we disagreed with
the interpretation which we do not we would still be
compelled to affirm the district court's grant of summary
judgment as the union's actions were plainly not "so far
outside a 'wide range of reasonableness'" as to constitute
irrational or arbitrary conduct. Air Line Pilots Ass'n, 111
_____________________
S. Ct. at 1136 (quoting Ford Motor Co. v. Huffman, 345 U.S.
______________ _______
330, 338 (1953)). Moreover, plaintiffs have failed to create
a genuine issue as to whether Local 1575 acted
discriminatorily or in bad faith. Plaintiffs allege in a
general fashion that Local 1575 favored ro-ro employees over
lo-lo employees. However, the situation unavoidably required
the union to make a determination as to which employees were
to have priority over others. That it did so in a manner
which, on its face, seems reasonable and in conformity with
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controlling agreements does not, by itself, show
"invidious 'discrimination' of the kind prohibited by the
duty of fair representation." Air line Pilots Ass'n, 111 S.
_____________________
Ct. at 1137; see also Colon Velez v. PRMMI, 957 F.2d 933, 940
________ ___________ _____
(1st Cir. 1992) ("the union must engage in a balancing of
interests"); Berrigan v. Greyhound Lines, Inc., 782 F.2d 295,
________ _____________________
298 (1st Cir. 1986) (quoting Michael C. Harper & Ira C. Lupu,
Fair Representation as Equal Protection, 98 Harv. L. Rev.
_________________________________________
1211, 1260 (1985) ("Administration may well require a union
to make distributional judgments as important as those made
in the negotiating stage.").
Because Local 1575's actions were based on a
reasonable interpretation of the Agreement, without any
demonstrable showing of bad faith, the union did not breach
its duty of fair representation by refusing to pursue
plaintiff's grievances. A union is under no duty to
arbitrate a grievance that it honestly and in good faith
believes lacks merit. Vaca, 386 U.S. at 191-92; Berrigan,
____ ________
782 F.2d at 298 (if a union were forced to arbitrate "a case
that it felt had little basis in the contract, it arguably
would jeopardize its credibility with the employer for
purposes of later, more supportable, disputes with management
policies, instituted on behalf of all members.").
We agree with the district court that Local 1575
did not breach its duty of fair representation either by
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entering into the stipulation with PRMMI or by refusing to
pursue plaintiff's grievances based upon changes made in
accordance with the stipulation.
C. Breach of Collective Bargaining Agreement
_________________________________________
As we stated previously, plaintiffs cannot succeed
on their breach of contract claim against PRMMI unless they
are also able to establish that Local 1575 breached its duty
of fair representation. Because plaintiffs have been unable
to establish a breach of the duty of fair representation on
the part of Local 1575, their breach of contract claim
against PRMMI must also fail. We, therefore, affirm the
district court's grant of summary judgment on the breach of
contract claim against PRMMI.5
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5. The parties have devoted considerable portions of their
appellate briefs to arguing over whether the district court
properly denied plaintiffs' motion for a preliminary
injunction against PRMMI for breach of the collective
bargaining agreement and against Local 1575 for breach of the
duty of fair representation. We find these arguments to be
puzzling since preliminary injunctions, which are
interlocutory in nature, cannot survive a final order of
dismissal. Pacific Tel. & Tel. Co. v. Kuykendall, 265 U.S.
________________________ __________
196 (1924); Shaffer v. Carter, 252 U.S. 37, 44 (1920); United
_______ ______ ______
States ex rel. Bergen v. Lawrence, 848 F.2d 1502, 1512 (10th
______________________ ________
Cir.), cert. denied, 488 U.S. 980 (1988); Cypress Barn, Inc.
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v. Western Elec. Co., 812 F.2d 1363, 1364 (11th Cir. 1987);
_________________
Madison Square Garden Boxing, Inc. v. Shavers, 562 F.2d 141,
___________________________________ _______
144 (2d 1977). Because the district court's denial of the
preliminary injunction was "merged in" the final judgment
dismissing the case, plaintiffs' complaints regarding the
preliminary injunction are moot. See Shaffer, 252 U.S. at
___ _______
44. In a similar vein, plaintiffs' arguments that the
district court abused its discretion by participating in the
examination of witnesses and arguing with plaintiffs'
attorney during the preliminary injunction hearing are also
moot. However, even if we were to address these contentions,
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D. Procedural Arguments
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Plaintiffs contend that the district court erred in
treating defendants' motion to dismiss as one for summary
judgment without giving plaintiffs an opportunity to
discover. Plaintiffs note that in July of 1991, they noticed
the depositions of Luis A. Colon, the Director of Labor
Relations at PRMMI, and Guillermo Ortiz Gonzalez, the
President of Local 1575. According to plaintiffs, the
depositions were important to their case because they had
formally and informally requested documents such as the
current collective bargaining agreement and seniority lists
for certain years, but their efforts had been fruitless.
Defendants thereafter filed a motion for a protective order
and a motion to dismiss. On August 9, 1991, the court stayed
the depositions until the motion to dismiss was decided.
Eight months after defendants filed their motion to dismiss,
the court, without any notification to plaintiffs, decided
the motion to dismiss as one for summary judgment.
When treating a Rule 12(b)(6) motion as a motion
for summary judgment, "all parties shall be given reasonable
opportunity to present all material made pertinent to such a
motion by Rule 56." Fed. R. Civ. P. 12(b) (motion to dismiss
____________________
we would find, based upon our careful review of the
transcripts of the preliminary injunction hearing, that the
district judge did not exceed his authority under Rules
611(a) and 614(b) of the Federal Rules of Evidence.
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for failure to state a claim upon which relief can be
granted) and 12(c) (motion for judgment on the pleadings).
Contrary to plaintiffs' contention, this circuit does not
mechanically enforce the requirement of express notice of a
district court's intention to convert a Rule 12(b)(6) motion
into a motion for summary judgment. Instead, we treat "any
error in failing to give express notice as harmless when the
opponent has received the affidavit and materials, has had an
opportunity to respond to them, and has not controverted
their accuracy." Moody v. Town Of Weymouth, 805 F.2d 30, 31
_____ ________________
(1st Cir. 1986). Thus, we have said, "[w]hen discovery has
barely begun and the nonmovant has had no reasonable
opportunity to obtain and submit additional evidentiary
materials to counter the movant's affidavits, conversion of a
Rule 12 motion to a Rule 56 motion is inappropriate."
Whiting v. Maiolini, 921 F.2d 5, 7 (1st Cir. 1990).
_______ ________
In the present case, plaintiffs had almost a year
between the filing of the motion to dismiss and the court's
treatment of that motion as one for summary judgment.
Moreover, over a year had elapsed since plaintiffs initially
filed their complaint. Summary judgment did not "follow[]
hard on the heels of the complaint or answer." Condon v.
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Local 2944, United Steel Workers of America, 683 F.2d 590,
_____________________________________________
594 (1st Cir. 1982). Furthermore, although entitled "Motion
to Dismiss," the motion, which quotes extensively from Fed.
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R. Civ. P. 56, plainly sought summary judgment relief as
well. Plaintiffs clearly understood the motion in this way
and responded to it by arguing that there were genuine issues
of material fact. In fact, in their memorandum opposing
defendants' motion, plaintiffs referred to the motion as one
for "dismissal of the complaint and summary judgment."
Plaintiffs cannot reasonably claim surprise at the district
court's treatment of the motion as one for summary judgment.
Furthermore, although the district court stayed several of
plaintiffs' requested depositions, the district court did not
stay all discovery. Presumably then, plaintiffs could have
filed motions to compel the production of the documents that
they sought. Under all the circumstances, we cannot say that
the district court's treatment of the motion as one for
summary judgment was unfair or improper.
Plaintiffs raise a number of other arguments
challenging the district court's grant of summary judgment
and its dismissal of PRMSA from the case. We have examined
each of these arguments carefully and find that none has any
merit.
III.
III.
The district court properly dismissed PRMSA for
lack of subject matter jurisdiction. The district court also
properly granted summary judgment to PRMMI and Local 1575.
Affirmed. Costs to Appellees.
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Document Info
Docket Number： 92-1658
Filed Date： 12/31/1992
Precedential Status： Precedential
Modified Date： 9/21/2015