United Government Security v. American Eagle Protective

FILED
United States Court of Appeals
PUBLISH Tenth Circuit
UNITED STATES COURT OF APPEALS April 21, 2020
Christopher M. Wolpert
FOR THE TENTH CIRCUIT Clerk of Court
_________________________________
UNITED GOVERNMENT SECURITY
OFFICERS OF AMERICA
INTERNATIONAL UNION and UNITED
GOVERNMENT SECURITY OFFICERS
OF AMERICA INTERNATIONAL No. 19-4084
UNION LOCAL 320,
Plaintiffs–Appellants,
v.
AMERICAN EAGLE PROTECTIVE
SERVICE CORP. and PARAGON
SYSTEMS, INC.,
Defendants–Appellees.
_________________________________
Appeal from the United States District Court
for the District of Utah
(D.C. No. 2:18-CV-00183-DN)
_________________________________
Dennis M. Coyne, McDonald Lamond Canzoneri, Southborough, Massachusetts (Lauren
I. Scholnick, Strindberg & Scholnick, LLC, Salt Lake City, Utah, with him on the briefs),
appearing for Appellants.
Frank D. Davis (Ron Chapman, Jr., with him on the brief), Ogletree, Deakins, Nash,
Smoak & Stewart, P.C., Dallas, Texas, appearing for Appellees.
_________________________________
Before BRISCOE, LUCERO, and McHUGH, Circuit Judges.
_________________________________
BRISCOE, Circuit Judge.
_________________________________
Plaintiffs-Appellants United Government Security Officers of America
International Union and its local, United Government Security Officers of America,
Local 320 (collectively, the Unions) sued American Eagle Protective Services
Corporation and Paragon Systems, Inc. (collectively, the Employers) under § 301 of
the Labor Management Relations Act (LMRA), seeking declaratory relief under the
Collective Bargaining Agreement (CBA) and to compel arbitration of a terminated
employee’s grievance. The district court granted summary judgment to the
Employers because it determined the six-month statute of limitations from the
National Labor Relations Act (NLRA) § 10(b) applied to the Union’s claim.
Exercising jurisdiction pursuant to 28 U.S.C. § 1291, we affirm the judgment of the
district court.
I
The Unions are labor organizations and at all relevant times were the exclusive
bargaining agent in a Collective Bargaining Agreement (CBA) with the Employers.
App. at 48–49, 56–78. The Employers terminated Michael Reid, a Salt Lake City
union member, by letter received on January 6, 2014. Id. at 49, 80.1 The Unions
grieved the termination on January 24, 2014, alleging that the member was
terminated without just cause. Id. at 84. The Employers denied the grievance on
January 29, 2014, alleging the member was terminated with just cause, id. at 161, and
1
The letter terminating the union member is dated January 3, 2013; the parties
agree it should read 2014. Aplt. Br. at 6 n.1, Aple. Br. at 2; see also App. at 48.
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maintained during exchanges throughout June, August, and September 2015, that
terminations with just cause like the member’s were not subject to arbitration under
the exceptions listed in the CBA. Id. at 162, 163–64 (“[a]s a result of the plain
language in the CBA, [the individual in charge of the relevant government contract at
the Employers] concluded that the decision to discharge Reid was not subject to
arbitration.”), and 272 n.22. On February 27, 2018, the Unions filed this action
pursuant to § 301 of the LMRA, seeking to compel arbitration of the grievance of the
wrongful discharge. The district court granted summary judgment to the Employers,
ruling that the action was time-barred.
II
Section 301 of the LMRA extends federal jurisdiction to “[s]uits for violation
of contracts between an employer and a labor organization representing employees in
an industry affecting commerce.” 29 U.S.C. § 185(a). However, no federal statute of
limitations expressly applies to LMRA § 301 actions. See DelCostello v. Int’l Bhd. of
Teamsters, 462 U.S. 151, 158 (1983). “In such situations . . . our task is to ‘borrow’
the most suitable statute or other rule of timeliness from some other source.” Id.
The parties to the present action debate whether a six-year or a six-month
statute of limitations should apply to a § 301 claim. The Unions contend Utah’s six-
year statute of limitations for breach of contract claims should apply; the Employers
contend § 10(b) of the NLRA’s six-month period for the filing of unfair labor
practice claims is more appropriate. “We have generally concluded that Congress
intended that the courts apply the most closely analogous statute of limitations under
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state law. . . . In some circumstances, however, state statutes of limitations can be
unsatisfactory vehicles for the enforcement of federal law.” Id. at 158, 161.
The Supreme Court defined those circumstances in DelCostello. Addressing a
“hybrid” suit brought by a union member under both § 301 and the NLRA against the
employer and the union, the Court applied the NLRA’s § 10(b) statute of limitations.
In determining whether to apply the federal statute of limitations as opposed to a
state statute of limitations applied in contract cases, the Court held: “[W]hen a rule
from elsewhere in federal law clearly provides a closer analogy than available state
statutes, and when the federal policies at stake and the practicalities of litigation
make that rule a significantly more appropriate vehicle for interstitial lawmaking, we
have not hesitated to turn away from state law.” Id. at 172.
When viewed in context, a claim to compel arbitration is more analogous to
one brought pursuant to NLRA’s § 10(b) than it is to a state law claim for breach of
contract. First, the underlying grievance is similar to an unfair labor practice as
governed by the NLRA,2 and “because many grievances involve activity that may
also constitute an unfair labor practice under the National Labor Relations Act, it
makes sense to have a common statute of limitations for claims arising under Section
10(b) and actions to compel arbitration.” Associated Brick Mason Contractors of
2
The Unions, citing 29 U.S.C. § 158, claim that a termination of employment
under a CBA is “simply a level of discipline,” “not in and of itself an unfair labor
practice.” Aplt. Br. at 27. While technically accurate with respect to the termination,
the termination is not the issue: submitting the grievance to arbitration is. As the
Employers note, the Unions filed a NLRB charge on that point. Aplt. Br. at 3, citing
App. at 169.
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Greater N.Y., Inc. v. Harrington, 820 F.2d 31, 37 (2d Cir. 1987) (citing DelCostello,
462 U.S. at 171); see also Fed’n of Westinghouse Indep. Salaried Unions v.
Westinghouse Elec. Corp., 736 F.2d 896, 902 (3d Cir. 1984) (“grievances often
involve an alleged activity which is also an unfair labor practice over which the
National Labor Relations Board has jurisdiction . . . Thus it makes a great deal of
sense to have a common statute of limitations for unfair labor practice charges and
for suits to compel arbitration.”) (internal citation omitted); McCreedy v. Local
Union No. 971, UAW, 809 F.2d 1232, 1238 (6th Cir. 1987) (“Just as the employee’s
unfair representation claim is a creature of labor law, so too, we believe, is a union’s
action to compel arbitration.”). Second, “[a]rbitration clauses are . . . sui generis and
cannot, as a matter of federal law, be viewed as equivalent to more ordinary
contractual provisions for limitation purposes . . . [thus] a suit to compel arbitration is
not much analogous to a garden-variety suit for breach of contract.” Commc’ns
Workers of Am., AFL-CIO v. W. Elec. Co., 860 F.2d 1137, 1141 (1st Cir. 1988).
Not only is § 10(b) a closer analogy to an action to compel arbitration, federal
policies underpinning labor law and the practicalities of litigation weigh in favor of
applying § 10(b)’s limitations period in cases brought to compel arbitration of a
grievance. As the Court noted in DelCostello, federal labor policy relies heavily upon
“grievance, arbitration, and the law of the shop.” DelCostello, 462 U.S. at 169
(internal citations and quotations omitted). Thus, by seeking to compel arbitration,
the Unions’ action lies at the heart of federal labor law. See McCreedy, 809 F.2d at
1238; see also W. Elec. Co., 860 F.2d at 1141 (“[A]rbitration clauses in collective
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bargaining agreements implicate important federal interests not present in ordinary ex
contractu litigation.”). “[B]ecause it involves a motion to compel arbitration in a
wrongful discharge case, this case is irrevocably tied to federal labor policy . . .
There is a strong [federal] policy favoring settlement of labor disputes by private
arbitration.” United Food & Commercial Workers Local 100A, AFL-CIO & CLC v.
John Hofmeister & Son, Inc., 950 F.2d 1340, 1348 (7th Cir. 1991).
In addition, applying a longer breach-of-contract statute of limitations would
“disserve[] the federal interest in ‘the relatively rapid final resolution of labor
disputes.’” Aluminum, Brick & Glassworkers Int’l Union Local 674 v. A.P. Green
Refractories, Inc., 895 F.2d 1053, 1055 (5th Cir. 1990) (citing DelCostello, 462 U.S.
at 168). “When the grievance, as here, is the discharge of a union member, and his
remedy is arbitration, it is important that the remedy be promptly invoked and
promptly administered—important to the named parties and especially important to
the aggrieved employee union member, and to those in management who have had
direct relationships with the grievant. They all need to know where they stand.”
Teamsters Union Local 315 v. Great W. Chem. Co., 781 F.2d 764, 766 (9th Cir.
1986). “Six years is simply too long to allow industrial disputes to fester.”
Harrington, 820 F.2d at 37; see also Westinghouse Elec. Corp., 736 F.2d at 901
(“Application of a six-year state statute of limitations stretches out industrial disputes
far longer than most recent cases have deemed desirable.”).
Finally, “there is a certain value in achieving uniformity among the federal
circuits in applying the same time limitations to suits to compel arbitration.”
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Commc’ns Workers of Am. v. Am. Tel. & Tel. Co., 10 F.3d 887, 891 (D.C. Cir. 1993).
Federal policy favors that uniformity, and ten other circuits3 have held that § 10(b)
applies under these circumstances.
We conclude § 10(b) is a better fit for actions brought under § 301 than Utah’s
statute of limitations for breach of contract because § 10(b) is a closer analogy to an
action to compel arbitration and more aligned with federal labor policy. A six-month
statute of limitations sets “the proper balance between the national interests in stable
bargaining relationships and finality of private settlements,” and a party’s right to
seek a court’s resolution. DelCostello, 462 U.S. at 171 (internal citations and
3
These circuits include: the D.C. Circuit, see Am. Tel. & Tel. Co., 10 F.3d at
888; the First Circuit, see W. Elec. Co., 860 F.2d at 1145; the Second Circuit, see
Harrington, 820 F.2d at 37; the Third Circuit, see Westinghouse Elec. Corp., 736
F.2d at 901; the Fifth Circuit, see A.P. Green Refractories, Inc., 895 F.2d at 1055; the
Sixth Circuit, see McCreedy, 809 F.2d at 1237; the Seventh Circuit, see John
Hofmeister & Son, Inc., 950 F.2d at 1347; the Eighth Circuit, see United Rubber,
Cork, Linoleum, & Plastic Workers of Am., AFL-CIO, CLU, Local 164 v. Pirelli
Armstrong Tire Corp., 104 F.3d 181, 183 (8th Cir. 1997) (“There is no dispute that
an action to compel arbitration is governed by the 6–month limitations period set
forth in § 10(b) of the National Labor Relations Act,” although this case does not
analyze the issue); and the Ninth Circuit, see Great W. Chem. Co., 781 F.2d at 769.
Finally, at least when faced with a lengthy statute of limitations like Utah’s,
the Eleventh Circuit has also followed the reasoning of other circuits. See Int’l Ass’n
of Machinists & Aerospace Workers, Local Lodge No. 1688 v. Allied Prod. Corp.,
786 F.2d 1561, 1564 (11th Cir. 1986) (“Because we find that state law affords no
reasonably applicable rule as to the proper time limitation for the union's action to
compel arbitration, we adopt the six month limitation period of § 10(b) in this case.”)
and Samples v. Ryder Truck Lines, Inc., 755 F.2d 881 (11th Cir. 1985), but see
United Paperworks Int’l, Local No. 395 v. ITT Rayonier, Inc., 931 F.2d 832, 838
(11th Cir. 1991) (applying Florida’s one year contract statute of limitations, largely
because it only extended the filing period for six additional months).
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quotations omitted). Thus, we conclude that § 10(b)’s six-month statute of limitations
applies.
III
Our prior precedent also aligns with this conclusion. In two previous cases,
Garcia v. Eidal Int’l Corp., 808 F.2d 717, 719 (10th Cir. 1986) and Trs. of Wyo.
Laborers Health & Welfare Plan v. Morgen & Oswood Const. Co. of Wyo., 850 F.2d
613, 621 (10th Cir. 1988), we have applied a state’s statute of limitations to labor
cases; but both cases involve true breach-of-contract claims, unlike the arbitration
dispute presented here.
In Garcia, the employer in question was trying to avoid the entire CBA—not
just the arbitration provision. 808 F.2d at 722 (“When the contract has been
completely repudiated and the employer has closed down its business, the labor law
policies that persuaded the Court in DelCostello to adopt the uniform six-month
statute of limitation are not applicable.”). While Garcia mentions “complete”
repudiation only once, the opinion makes clear that applying the state breach-of-
contract limitations period is only appropriate when the issue is whether the entire
contract would be repudiated. 808 F.2d at 719 (“We reverse and remand, concluding
that the holding of DelCostello does not extend to cases in which an employer has
repudiated all of its obligations under a bargaining agreement, including the duty to
arbitrate.”). Here, as the Employers note, the CBA was cited as the basis for not
arbitrating the grievance; which contradicts the Unions’ characterization of the
Employers’ behavior as “repudiating” the arbitration provision. Thus, Garcia does
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not govern the fact pattern presented here, where a union seeks to compel arbitration
of a grievance in accordance with the CBA, and an employer declines to arbitrate on
the basis of the CBA itself.
Trs. of Wyo. Laborers Health & Welfare Plan presents an even less analogous
fact pattern. 850 F.2d at 615–17. While again we applied the state statute of
limitations for breach of contract, the action was brought under the Employee
Retirement Income Security Act, not § 301. The employer did argue that breaching
the agreement could be an unfair labor practice, and that the six month limitations
period thus applied under DelCostello. But we made clear that, because “the Trustees
are not employees, and have not sued the relevant union for a breach of the duty of
fair representation,” DelCostello did not apply. Id. at 619.
IV
Because § 10(b)’s six-month statute of limitations applies and the Unions
brought suit nearly two years after the Employers’ final refusal to arbitrate the
grievance, this suit is time-barred. The judgment of the district court is AFFIRMED.
Entered for the Court
Mary Beck Briscoe
Circuit Judge
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