Detabali v. St. Luke's Hospital

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
LORRAINE DETABALI, 
Plaintiff-Appellant,
v. No. 05-15591
ST. LUKE’S HOSPITAL; JOHN
WILLIAMS; PHILIP GARDNER;  D.C. No.
CV-04-03198-PJH
CHRISTINE GREEN; EVANGELINE
OPINION
MONDARES; SUSAN MCCORQUODALE;
ROSE RENEE,
Defendants-Appellees.

Appeal from the United States District Court
for the Northern District of California
Phyllis J. Hamilton, District Judge, Presiding
Argued and Submitted
February 15, 2007—San Francisco, California
Filed April 16, 2007
Before: Ronald M. Gould and Milan D. Smith, Jr.,
Circuit Judges, and Alfred V. Covello,* District Judge.
Opinion by Milan D. Smith, Jr.
*The Honorable Alfred V. Covello, Senior United States District Judge
for the District of Connecticut, sitting by designation.
4315
4318 DETABALI v. ST. LUKE’S HOSPITAL
COUNSEL
Charles J. Katz, Millbrae, California, for the plaintiff-
appellant.
Alex Hernaez, Kauff, McClain & McGuire LLP, San Fran-
cisco, California, for the defendants-appellees.
OPINION
MILAN D. SMITH, JR., Circuit Judge:
Plaintiff-Appellant Lorraine Detabali (Detabali) appeals the
district court’s (1) ruling that her California Fair Employment
DETABALI v. ST. LUKE’S HOSPITAL 4319
and Housing Act (FEHA), Cal. Gov’t Code § 12940 et seq.,
claims for employment discrimination and retaliation against
Defendant-Appellee St. Luke’s Hospital’s (St. Luke’s) were
preempted by § 301 of the Labor Management Relations Act
(LMRA), 29 U.S.C. § 185(a), and (2) imposition of sanctions
against her attorney, Charles J. Katz (Katz), for flouting the
court’s instructions regarding a possible second amended
complaint.
We reverse the district court’s dismissal of Detabali’s
FEHA claims and the imposition of sanctions against Deta-
bali’s counsel, and remand to the district court with instruc-
tions to remand Detabali’s action to the San Francisco
Superior Court.
BACKGROUND
Lorraine Detabali, a 57-year-old Filipina woman, was
employed as an intensive care unit nurse at St. Luke’s. She
also served as a union representative and had been instrumen-
tal in negotiating provisions of the collective bargaining
agreement concerning certain measures to ensure quality of
care, patient safety, and minimize liability exposure for
nurses. St. Luke’s terminated Detabali for insubordination,
patient abandonment, and the harassment of another regis-
tered nurse when she refused the order of a nurse supervisor
to work in the emergency room. Detabali filed suit against St.
Luke’s in San Francisco Superior Court, alleging common
law claims for breach of contract, breach of the covenant of
good faith and fair dealing, and claims under the FEHA for
discrimination on the basis of her race and national origin,
retaliation, and harassment. She denied St. Luke’s claim that
her refusal to work in the emergency room constituted insub-
ordination because under the “cluster” provision of the gov-
erning collective bargaining agreement, intensive care unit
nurses are not required to report to the emergency room unit.
St. Luke’s removed the action to federal court pursuant to
28 U.S.C. § 1441(b), alleging that Detabali’s contractual
4320 DETABALI v. ST. LUKE’S HOSPITAL
claims were preempted by § 301 of the LMRA. Detabali filed
a first amended complaint with the district court, omitting the
previous claims for breach of contract, fraud, and breach of
the covenant of good faith and fair dealing, but alleging
claims for employment discrimination, retaliation, and harass-
ment in violation of the FEHA, failure to prevent discrimina-
tion, and tortious termination. The district court granted St.
Luke’s motion to dismiss Detabali’s first amended complaint,
ruling that her FEHA employment discrimination and retalia-
tion claims were preempted by § 301 of the LMRA, and that
she had failed to exhaust the grievance procedures set forth in
§ 301 of the LMRA. The district court also held that Detabali
failed to support her harassment claim with allegations that
she was harassed based on her race, national origin, or age.
Although the district court gave Detabali leave to amend her
first amended complaint to plead federal claims pursuant to
§ 301 of the LMRA, the court instructed Detabali not to
replead the preempted claims, and to replead her harassment
claim with facts demonstrating that she was harassed based on
her membership in a protected class.
Detabali filed a second amended complaint, in which she
repled the FEHA claims that the district court previously held
were preempted and did not plead claims that were fully
exhausted or within the LMRA’s statute of limitations. Deta-
bali also failed to plead additional factual allegations in sup-
port of her harassment claim. The district court granted St.
Luke’s motion to dismiss Detabali’s second amended com-
plaint and personally sanctioned Katz in the sum of $1,000.
Detabali timely appealed the district court’s dismissal of
her complaint and the imposition of sanctions on Katz.
JURISDICTION AND STANDARDS OF REVIEW
The district court purported to exercise original jurisdiction
pursuant to 28 U.S.C. §§ 1331 and 1441(b)-(c). We have
jurisdiction under 28 U.S.C. § 1291.
DETABALI v. ST. LUKE’S HOSPITAL 4321
Defects in subject matter jurisdiction are nonwaivable and
may be raised at any time, including on appeal. Ins. Corp. of
Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S.
694, 702 (1982); Galvez v. Kuhn, 933 F.2d 773, 775 n.4 (9th
Cir. 1991). Because judgment has been entered in this matter,
the question is “not whether removal was proper, but whether
the district court had jurisdiction at the time it issued its judg-
ment.” Rains v. Criterion Sys., Inc., 80 F.3d 339, 342 (9th Cir.
1996).
We review a district court’s finding of preemption under
§ 301 of the LMRA de novo. Cramer v. Consol. Freightways,
Inc., 255 F.3d 683, 689 (9th Cir. 2001) (en banc).
We review sanctions imposed pursuant to Federal Rule of
Civil Procedure 11 for abuse of discretion. Ramirez v. Fox
Television Station, Inc., 998 F.2d 743, 750 (9th Cir. 1993).
DISCUSSION
I.
[1] Section 301 of the LMRA preempts a state-law claim
“if the resolution of [that] claim depends upon the meaning of
a collective-bargaining agreement.” Id. at 748 (quoting Lingle
v. Norge Div. of Magic Chef, Inc., 486 U.S. 399, 405-06
(1988)). “The plaintiff’s claim is the touchstone for this analy-
sis; the need to interpret the [collective bargaining agreement]
must inhere in the nature of the plaintiff’s claim. If the claim
is plainly based on state law, § 301 preemption is not man-
dated simply because the defendant refers to the [collective
bargaining agreement] in mounting a defense.” Cramer, 255
F.3d at 691. A “reference to or consideration of the terms of
a collective bargaining agreement is not the equivalent of
interpreting the meaning of the terms.” Ramirez, 998 F.2d at
749.
[2] “Causes of action that only tangentially involv[e] a pro-
vision of a collective-bargaining agreement are not preempted
4322 DETABALI v. ST. LUKE’S HOSPITAL
by section 301. Nor are causes of action which assert nonne-
gotiable state-law rights . . . independent of any right estab-
lished by contract.” Id. at 748 (alteration in the original)
(citations and internal quotation marks omitted). “A discrimi-
nation claim need not be preempted merely because certain
aspects of the collective bargaining agreement govern work
assignments and discharges.” Jimeno v. Mobil Oil Corp., 66
F.3d 1514, 1525 (9th Cir. 1995) (internal quotation marks
omitted).
In Ramirez, we considered a claim that Fox Television Sta-
tions, Inc. had discriminated against an employee on the basis
of her national origin in violation of the FEHA. 998 F.2d at
746. In rejecting Fox’s argument that Ramirez’s claims
required the interpretation of the collective bargaining agree-
ment, we explained:
The Bargaining Agreement will likely be referred to
by Ramirez and Fox to determine the terms and con-
ditions of her employment. But her underlying cause
of action is that Fox discriminated against her in
applying and/or altering those terms and conditions.
Although the inquiry may begin with the Bargaining
Agreement, it certainly will not end there.
Id. at 748-49.
[3] Detabali alleges that St. Luke’s discriminated against
her on the basis of her race and ethnicity. The viability of
Detabali’s FEHA claims depends on whether she was legiti-
mately terminated for refusing to work outside of her cluster.
In order to make this determination, the court will have to
refer to the cluster provision of the collective bargaining
agreement. However, because there is no dispute over the
meaning of any terms within the agreement, resolution of the
central issue—whether St. Luke’s discriminated against Deta-
bali in applying the agreement— does not depend on interpre-
tation of the collective bargaining agreement.
DETABALI v. ST. LUKE’S HOSPITAL 4323
[4] We see no need to depart from a long line of our cases
holding that FEHA employment discrimination claims are not
ipso facto preempted by § 301 of the LMRA. See, e.g.,
Jimeno, 66 F.3d at 1522; Ramirez, 998 F.2d at 748-49; Cook
v. Lindsay Olive Growers, 911 F.2d 233, 240 (9th Cir. 1990);
Jackson v. S. Cal. Gas Co., 881 F.2d 638, 644 (9th Cir. 1989);
Ackerman v. W. Elec. Co., 860 F.2d 1514, 1517-18 (9th Cir.
1988). We hold that the district court erred in finding that
Detabali’s FEHA discrimination and retaliation claims were
preempted by § 301 of the LMRA and in dismissing these
claims for failure to exhaust the grievance procedure under
§ 301 of the LMRA. Because Detabali’s claims were not pre-
empted by § 301 of the LMRA, the district court lacked juris-
diction over her case and, therefore, we also reverse the
district court’s dismissal of her FEHA harassment claim.
II.
Detabali argues that the district court abused its discretion
in imposing sanctions against Katz. St. Luke’s asserts that we
lack jurisdiction to review the imposition of sanctions against
Katz because Detabali lacks standing to appeal an order
imposing sanctions against her attorney and Katz was not a
named party in the notice of appeal.
[5] We disagree with St. Luke’s. In Retail Flooring Dealers
of America, Inc. v. Beaulieu of America, LLC, 339 F.3d 1146
(9th Cir. 2003), this court found that it had jurisdiction to hear
counsel’s appeal from the district court’s order imposing
sanctions against him even though the counsel’s name did not
appear on the notice of appeal. Id. at 1149. We explained that
“[u]nder revised [Federal Rule of Appellate Procedure] 3(c),
if it appears on the face of the notice that an appeal is
intended by a party not named, then the appeal is deemed well
taken.” Id. at 1148. We found:
Counsel’s intent is clear from the face of the notice
of appeal. The notice of appeal directly challenges
4324 DETABALI v. ST. LUKE’S HOSPITAL
only the sanctions against Retail Flooring’s counsel.
Counsel was aware that the notice of appeal chal-
lenged only the sanction against him: his name
appears on the notice as the attorney for Retail
Flooring and he signed and filed the notice of appeal.
Id. at 1149. The reasoning of Retail Flooring is applicable to
this appeal. Like counsel in Retail Flooring, Katz prepared,
signed, and filed Detabali’s notice of appeal. Although Deta-
bali’s notice of appeal differs from the notice of appeal filed
in Retail Flooring in that it challenges the district court’s dis-
missal of the FEHA claims in addition to the order imposing
sanctions, Katz’s intent to appeal is clear from the face of the
notice of appeal.1 We rule that Katz’s clear intent to appeal
the district court’s sanction makes him a party to this appeal
under Rule 3(c), and that we have jurisdiction to entertain the
appeal. See id.
[6] We hold that the district abused its discretion in impos-
ing sanctions on Katz. Katz’s repleading of Detabali’s FEHA
claims preserved them for this appeal and our decision in this
case demonstrates the merits of his decision. We believe it
would be perverse to uphold an award of sanctions against
counsel for taking actions that ultimately preserved his cli-
ent’s right to proceed with her case. We reverse the district
court’s award of sanctions.
CONCLUSION
We reverse the district court’s dismissal of Detabali’s
FEHA claims and its imposition of sanctions against Katz.
We remand to the district court with instructions to remand
the case to the San Francisco Superior Court.
1
Katz’s belief that he is a party to the appeal is further apparent from
the opening brief, in which he states, “Detabali and Katz appeal.”
DETABALI v. ST. LUKE’S HOSPITAL 4325
Each party shall bear its own costs on appeal.
REVERSED AND REMANDED.