Raymond Garcia v. Seiu

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
RAYMOND GARCIA, as a member, No. 19-16863
and on behalf of Clark County Public
Employees Association, D.C. Nos.
Plaintiff-Appellee, 2:17-cv-01340-
APG-NJK
and 2:17-cv-02137-
APG-NJK
CHERIE MANCINI; FREDERICK
GUSTAFSON,
Plaintiffs,
v.
SERVICE EMPLOYEES
INTERNATIONAL UNION; NEVADA
SERVICE EMPLOYEES UNION; MARY
KAY HENRY, in her official capacity
as Union President; LUISA BLUE, in
her official capacity as trustee,
Defendants-Appellants.
2 GARCIA V. SEIU
RAYMOND GARCIA, as a member, No. 19-16933
and on behalf of Clark County Public
Employees Association, D.C. Nos.
Plaintiff-Appellant,
2:17-cv-01340-
and APG-NJK
2:17-cv-02137-
CHERIE MANCINI; FREDERICK APG-NJK
GUSTAFSON,
Plaintiffs,
v.
SERVICE EMPLOYEES
INTERNATIONAL UNION; NEVADA
SERVICE EMPLOYEES UNION; MARY
KAY HENRY, in her official capacity
as Union President; LUISA BLUE, in
her official capacity as trustee,
Defendants-Appellees.
GARCIA V. SEIU 3
CHERIE MANCINI, No. 19-16934
Plaintiff-Appellant,
D.C. Nos.
and 2:17-cv-01340-
APG-NJK
RAYMOND GARCIA, as a member, 2:17-cv-02137-
and on behalf of Clark County Public APG-NJK
Employees Association; FREDERICK
GUSTAFSON,
Plaintiffs, OPINION
v.
SERVICE EMPLOYEES
INTERNATIONAL UNION; NEVADA
SERVICE EMPLOYEES UNION; MARY
KAY HENRY, in her official capacity
as Union President; LUISA BLUE, in
her official capacity as trustee,
Defendants-Appellees.
Appeal from the United States District Court
for the District of Nevada
Andrew P. Gordon, District Judge, Presiding
Argued and Submitted October 16, 2020
San Francisco, California
Filed April 5, 2021
4 GARCIA V. SEIU
Before: M. Margaret McKeown and Jacqueline H.
Nguyen, Circuit Judges, and Eric N. Vitaliano, *
District Judge.
Opinion by Judge Nguyen
SUMMARY **
Labor Law
The panel affirmed the district court’s order granting in
part a union’s motion to dismiss and holding that five claims
brought by a union member were preempted by § 301 of the
Labor Management Relations Act and were therefore
“converted” into § 301 claims.
This dispute between union members and their union
arose out of a trusteeship imposed on Nevada Service
Employees Union (the “Local”) by the Service Employees
International Union (the “International”). Local member
Raymond Garcia filed suit in state court against the
International, International officials, and the Local’s board
(collectively, the “Union”), challenging the trusteeship as
violating the Local’s constitution, the International’s
constitution, and an affiliation agreement between the two
organizations. The Union removed the case to federal court.
*
The Honorable Eric N. Vitaliano, United States District Judge for
the Eastern District of New York, sitting by designation.
**
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
GARCIA V. SEIU 5
The panel concluded that Garcia’s claims required
analysis of at least one § 301 labor contract and were
therefore preempted and removable. Agreeing with other
Circuits, the panel held that § 301 completely preempts state
law claims based on contracts between labor unions, which
may include union constitutions. The panel held that savings
clauses included in the Labor Management Reporting and
Disclosure Act did not repeal § 301’s preemptive force. The
panel held that in determining whether any state law claim is
preempted and removable, the court employs a two-step
analysis. First, the court determines whether the cause of
action involves a right conferred by state law, as opposed to
by a labor contract. If the labor contract alone creates the
right, the claim is preempted and the analysis ends. Second,
if the right underlying the state law claim exists
independently of the labor contract, the court determines
whether the right is nevertheless substantially dependent on
analysis of a labor contract. Where there is substantial
dependence, the state law claim is preempted by § 301.
The panel addressed the parties’ remaining issues on
appeal in a concurrently issued memorandum disposition.
COUNSEL
Jonathan Cohen (argued), Glenn Rothner, Eli Naduris-
Weissman, and Juhyung Harold Lee, Rothner Segall &
Greenstone, Pasadena, California; Evan L. James and Kevin
B. Archibald, Christensen James & Martin, Las Vegas,
Nevada; for Defendants-Appellants/Cross-Appellees.
Michael J. McAvoyAmaya (argued), Las Vegas, Nevada, for
Plaintiffs-Appellees/Cross-Appellants.
6 GARCIA V. SEIU
OPINION
NGUYEN, Circuit Judge:
This dispute between union members and their union
arises out of a trusteeship imposed on Nevada Service
Employees Union (“the Local”) by the Service Employees
International Union (the “International”). Following a
period of internal strife and two hearings investigating
member complaints, a majority of the Local’s executive
board voted to request the trusteeship. Local member
Raymond Garcia filed suit in state court against the
International, International officials, and the Local’s board
(collectively, “the Union”) challenging the trusteeship as
violating the Local’s constitution, the International’s
constitution, and an affiliation agreement between the two
organizations. The case was removed to federal court, and
the district court granted the Union’s motion dismiss in part,
holding that five claims were preempted by § 301 of the
Labor Management Relations Act (“LMRA”), 29 U.S.C.
§ 185, and were therefore “converted” into § 301 claims.
The consolidated plaintiffs (the “Union Members”) appeal.
We affirm the district court’s preemption determination and
its exercise of jurisdiction over the preempted claims. 1
I. BACKGROUND
The Local is an affiliate of the International and is
governed by the Local Constitution, which is generally
subordinate to the International Constitution. The Local and
the International are also parties to an Affiliation Agreement.
1
Garcia’s suit was consolidated with Mancini v. SEIU, No. 19-
16934, but we deal here only with issues relevant to Garcia’s claims.
The parties’ remaining issues on appeal are addressed in a concurrently
issued memorandum disposition.
GARCIA V. SEIU 7
The Affiliation Agreement contains a waiver provision
purporting to, in some circumstances, waive portions of the
International Constitution concerning trusteeships.
After the International received numerous complaints
from Local members regarding the breakdown of the Local’s
basic governance and democratic processes, the
International ordered a hearing concerning the state of the
Local. The hearing officer issued findings of fact and
recommendations including a recommendation that the
International place the Local into trusteeship. The Local
Board met with two representatives of the International and
the International’s associate general counsel, and voted to
request that the International place the Local into trusteeship.
The International subsequently did so.
Garcia filed suit in state court against the Union. He
brought seven state law claims: (1) breach of contract by the
Local Board, (2) breach of contract by the International,
(3) breach of the implied covenant of good faith and fair
dealing by the International, (4) fraudulent
misrepresentation by the International, (5) negligent
misrepresentation by the International, (6) legal malpractice
by the International’s associate general counsel, and
(7) breach of fiduciary duty by the International. After
removing the case to federal court, the Union moved to
dismiss Garcia’s claims. The district court granted the
motion in part, holding that five of the claims (Claims 2, 3,
5, 6, and 7) were preempted by § 301 of the LMRA and thus
“converted” into—that is, treated as—§ 301 claims. The
Union Members appeal.
II. JURISDICTION AND STANDARD OF REVIEW
We have jurisdiction under 28 U.S.C. § 1291, and we
review the existence of subject matter jurisdiction de novo.
8 GARCIA V. SEIU
Ignacio v. Judges of U.S. Court of Appeals for Ninth Circuit,
453 F.3d 1160, 1165 (9th Cir. 2006). We review a district
court’s ruling on a motion to dismiss de novo. Colony Cove
Props., LLC v. City of Carson, 640 F.3d 948, 955 (9th Cir.
2011).
III. DISCUSSION
The Union Members argue that the district court erred in
exercising federal question jurisdiction over Garcia’s state
law claims, because § 301 of the LMRA does not preempt
claims based on a union constitution. They are mistaken.
Section § 301 completely preempts state law claims based
on contracts between labor unions, which may include union
constitutions. The district court correctly held that Garcia’s
claims required analysis of at least one § 301 labor contract
and were therefore preempted.
A. Section 301 Completely Preempts Claims That
Require Interpretation of a Union Constitution, to
the Extent the Constitution is a Contract Between
Unions.
State law claims that are completely preempted are
removable to federal court under the complete preemption
corollary to the well-pleaded complaint rule. Caterpillar
Inc. v. Williams, 482 U.S. 386, 392–93 (1987). This doctrine
allows state law claims to be removed to federal court, even
where a federal question does not appear on the face of the
complaint, because “[o]nce an area of state law has been
completely pre-empted, any claim purportedly based on that
pre-empted state law is considered, from its inception, a
federal claim, and therefore arises under federal law.” Id. at
392; see 28 U.S.C. § 1331. Section 301 is one of just three
federal statutes that the Supreme Court has held to “so
preempt their respective fields as to authorize removal of
GARCIA V. SEIU 9
actions seeking relief exclusively under state law. . . .” 2 In
re Miles, 430 F.3d 1083, 1088 (9th Cir. 2005). State law
claims that fall within the area of § 301 are considered
federal law claims and are preempted and removable. Avco
Corp. v. Aero Lodge No. 735, Int’l Ass’n of Machinists &
Aerospace Workers, 390 U.S. 557, 560–61 (1968);
Franchise Tax Bd. of State of Cal. v. Constr. Laborers
Vacation Tr. for S. California, 463 U.S. 1, 23–24 (1983).
Section 301(a) of the LMRA provides:
Suits for violation of contracts between an
employer and a labor organization
representing employees in an industry
affecting commerce as defined in this
chapter, or between any such labor
organizations, may be brought in any district
court of the United States having jurisdiction
of the parties, without respect to the amount
in controversy or without regard to the
citizenship of the parties.
29 U.S.C. § 185(a) (emphasis added). “[U]nion
constitutions are an important form of contract between
2
The Union Members rely extensively on Int’l Ass’n of Machinists
v. Gonzales, 356 U.S. 617 (1958), arguing that it creates an exception to
§ 301 preemption for suits filed by union members against unions in state
court, particularly when the suit alleges violation of a union constitution.
This argument is unavailing because Gonzales concerns the scope of
preemption under the National Labor Relations Act (“NLRA”), not
under § 301. Farmer v. United Bhd. of Carpenters & Joiners of Am.,
Local 25, 430 U.S. 290, 301 n.10 (1977) (explaining that Gonzales
“established another exception to the general rule of [NLRA] preemption
for state-law actions alleging expulsion from union membership in
violation of the applicable union constitution and bylaws and seeking
restoration to membership and damages”).
10 GARCIA V. SEIU
labor organizations,” Wooddell v. Int’l Bhd. of Elec.
Workers, Local 71, 502 U.S. 93, 101 (1991), and therefore
“a union constitution is a ‘contract’ within the plain meaning
of § 301(a),” United Ass’n of Journeymen & Apprentices v.
Local 334, 452 U.S. 615, 622 (1981).
We have previously held that a union member may bring
suit directly under § 301 for violation of a union constitution.
Kinney v. Int’l Bhd. of Elec. Workers, 669 F.2d 1222, 1229
(9th Cir. 1981) (citing Stelling v. Int’l Bhd. of Elec. Workers
Local Union No. 1547, 587 F.2d 1379, 1382–83 (9th Cir.
1978)). Kinney and Stelling did not decide whether state law
claims based on a union constitution are subject to § 301
preemption and removable. They are. As the text of the
statute and Supreme Court authority make clear, § 301
preempts state law claims based on a union constitution to
the extent the constitution is a contract between labor unions.
Every court of appeals to have addressed the question agrees.
See Kitzmann v. Local 619-M Graphic Commc’ns
Conference of Int’l Bhd. of Teamsters, 415 F. App’x 714,
719 (6th Cir. 2011) (holding that state law claims based on
an international constitution, district-level constitution, and
affiliation agreement are preempted as those documents are
labor contracts under § 301); Wall v. Constr. & Gen.
Laborers’ Union, Local 230, 224 F.3d 168, 178 (2d Cir.
2000) (finding that “for preemption purposes, the term ‘labor
contract’ includes union constitutions” and holding claims
preempted by § 301); DeSantiago v. Laborers Int’l Union of
N. Am., Local No. 1140, 914 F.2d 125, 128 (8th Cir. 1990)
(holding that because union members had “alleged claims
against the Local based upon the local and international
constitutions, . . those claims were preempted by section
301(a)”); Pruitt v. Carpenters’ Local Union No. 225 of
United Bhd. of Carpenters & Joiners, 893 F.2d 1216, 1219
GARCIA V. SEIU 11
(11th Cir. 1990) (finding that § 301 completely preempted
state law claim alleging violation of union constitution).
The Union Members argue that even if § 301 once
preempted state law claims alleging breach of a union
constitution, Congress repealed § 301’s preemptive force by
including in the Labor Management Reporting and
Disclosure Act (“LMRDA”), 29 U.S.C. § 401 et seq., six
savings clauses that operate to preserve state claims and
remedies brought by union members against their unions to
enforce union constitutions. But three of the clauses cited
by the Union Members are entirely inapplicable, 3 and none
reinvigorate state rights or remedies preempted by other
federal statutes. 4 The latter point is key. The LMRDA
3
Section 524 “saves only state criminal laws and thus cannot
directly save” Garcia’s state law claims. Bloom v. Gen. Truck Drivers,
Office, Food & Warehouse Union, Local 952, 783 F.2d 1356, 1360 (9th
Cir. 1986). Section 483 applies only to state law challenges to union
elections and only saves claims regarding pre-election conduct, which
are not at issue here. And § 501 is not a savings clause; it provides a
private right of action.
4
Section 413 preserves state law causes of action by union members
seeking to vindicate the basic rights provided in the LMRDA’s Bill of
Rights or broader rights provided by states, which Garcia is not seeking
here. See, e.g., Int’l Bhd. of Boilermakers, Iron Shipbuilders,
Blacksmiths, Forgers & Helpers, AFL-CIO v. Hardeman, 401 U.S. 233,
244 n.11 (1971). Section 523 specifically preserves state law remedies
for breach of fiduciary duty and related issues—i.e., issues concerning
the “responsibilities” of the union and its officers. See Brown v. Hotel
& Rest. Employees & Bartenders Int’l Union Local 54, 468 U.S. 491,
506 (1984) (finding that § 523 “indicates that Congress necessarily
intended to preserve some room for state action concerning the
responsibilities and qualifications of union officials”) (emphasis added);
Hotel Employees & Rest. Employees Int’l Union v. Nevada Gaming
Comm’n, 984 F.2d 1507, 1514 (9th Cir. 1993) (observing that “[t]he
LMRDA . . . imposes qualification requirements on union officials and
12 GARCIA V. SEIU
contains no words repealing § 301 or its preemptive effect.
“The cardinal rule is that repeals by implication are not
favored.” Posadas v. Nat’l City Bank of N.Y., 296 U.S. 497,
503 (1936). And although “[w]here there are two acts upon
the same subject, effect should be given to both if possible,”
id., none of the LMRDA’s savings clauses concern the
subject of uniform interpretation of labor contracts. Even if
there is topical overlap between the statutes, “[i]t is not
sufficient . . . to establish, that subsequent laws cover some
or even all of the cases provided for by the prior act; for they
may be merely affirmative, or cumulative or auxiliary.” Id.
at 504 (quotation omitted). That is the case with the LMRA
and the LMRDA: “Congress was aware that the rights
conferred by the [LMRDA] overlapped those available
under state law and other federal legislation, and expressly
provided that these rights were to be cumulative[,]” Grand
Lodge of Int’l Ass’n of Machinists v. King, 335 F.2d 340, 347
(9th Cir. 1964), with the new protections contained in the
LMRDA overlapping and supplementing existing state and
federal protections, Brock v. Writers Guild of Am., W., Inc.,
762 F.2d 1349, 1358 n.8 (9th Cir. 1985). The LMRDA
savings clauses do not operate to repeal § 301’s preemptive
effect.
expressly disclaims any intent to preempt state regulation of union
officials”) (citing 29 U.S.C. § 523(a)). The clause allows Garcia to bring
a state law breach of fiduciary duty claim, which he did, but as explained
below, his claim requires interpretation of a § 301 labor contract,
triggering § 301 preemption. Finally, § 466 provides that the LMRDA’s
“rights and remedies” concerning trusteeships “shall be in addition to
any and all other rights and remedies at law or in equity.” 29 U.S.C.
§ 466 (emphasis added).
GARCIA V. SEIU 13
B. Garcia’s Claims Were Preempted and Removable.
All that remains is to determine whether Garcia’s claims
were preempted. We hold that the district court was correct:
Garcia’s five claims were preempted by § 301 and the
district court had subject matter jurisdiction over those
claims. 5
To determine whether any state law claim is preempted
and removable, “we need only inquire whether [the] claim
arose under section 301. . . .” Newberry v. Pac. Racing
Ass’n, 854 F.2d 1142, 1146 (9th Cir. 1988). We employ a
two-step analysis: First, we determine whether the cause of
action involves a right conferred by state law, as opposed to
by a labor contract. Kobold v. Good Samaritan Reg’l Med.
Ctr., 832 F.3d 1024, 1032 (9th Cir. 2016). If the labor
contract alone creates the right, the claim is preempted and
the analysis ends. Id. See also Livadas v. Bradshaw,
512 U.S. 107, 123–24 (1994) (“[I]t is the legal character of
a claim, as independent of rights under the [labor contract]
. . . that decides whether a state cause of action may go
forward.”) (internal citation omitted).
Second, if the right underlying the state law claim “exists
independently” of the labor contract, we determine whether
the right is “‘nevertheless substantially dependent on
analysis’” of a labor contract. Kobold, 832 F.3d at 1032
(quoting Burnside v. Kiewit Pac. Corp., 491 F.3d 1053, 1059
(9th Cir. 2007)). Said differently, “in order for complete
preemption to apply, the need to interpret the [labor contract]
must inhere in the nature of the plaintiff’s claim.” Valles v.
Ivy Hill Corp., 410 F.3d 1071, 1076 (9th Cir. 2005)
5
The district court also had supplemental jurisdiction over the non-
preempted pendant state law claims under 28 U.S.C. § 1367.
14 GARCIA V. SEIU
(quotation omitted). “[T]he term ‘interpret’ is defined
narrowly—it means something more than ‘consider,’ ‘refer
to,’ or ‘apply.’” Balcorta v. Twentieth Century-Fox Film
Corp., 208 F.3d 1102, 1108 (9th Cir. 2000). While this may
be a “hazy” line, “the totality of the policies underlying
§ 301,” including “securing the uniform interpretation of
labor contracts . . . guides our understanding of what
constitutes ‘interpretation.’” Id. at 1108–09 (citation
omitted). There is not substantial dependence “when the
meaning of contract terms is not the subject of dispute,”
Livadas, 512 U.S. at 124, and “the bare fact that a [labor
contract] will be consulted in the course of state-law
litigation plainly does not require the claim to be
extinguished.” Id. If there is not substantial dependence,
“the claim can proceed under state law.” Kobold, 832 F.3d
at 1033. But “[w]here there is such substantial dependence,
the state law claim is preempted by § 301,” id., and “that
claim must either be treated as a § 301 claim, or dismissed
as pre-empted by federal labor-contract law,” Allis-
Chalmers Corp. v. Lueck, 471 U.S. 202, 220 (1985) (citing
Avco, 390 U.S. at 557).
Garcia’s claims are based chiefly on two contracts
between labor organizations: the International Constitution
and the Affiliation Agreement between the Local and
International. See Lathers Local 42-L v. United Bhd. of
Carpenters & Joiners of Am., 73 F.3d 958, 961 (9th Cir.
1996) (“An agreement of affiliation between unions is a
contract between labor organizations.”). Interpretation of
the Affiliation Agreement’s waiver provision is central to all
of Garcia’s claims, because Garcia alleges that the
Affiliation Agreement operates to (1) preserve those
portions of the Local Constitution that require the Local
Board to hold a special election and bar it from voting for a
trusteeship, and (2) waive those portions of the International
GARCIA V. SEIU 15
Constitution that would allow the International to impose a
trusteeship.
Garcia’s breach of contract claim against the
International alleges that the International breached the
Affiliation Agreement’s waiver provision and violated the
Local’s right to be free from trusteeship pursuant to the terms
of the Affiliation Agreement. His breach of implied
covenant of good faith and fair dealing claim alleges that the
International made misrepresentations about the content of
the Affiliation Agreement and the International Constitution
that caused the Local Board to vote in favor of the
trusteeship, breaching the covenant—a guarantee that
“‘derives from the contract [and] is defined by the
contractual obligation of good faith,’ and therefore [is]
preempted to the same extent the breach of contract claim
is.” Audette v. Int’l Longshoremen’s & Warehousemen’s
Union, 195 F.3d 1107, 1112 (9th Cir. 1999) (quoting Allis-
Chalmers, 471 U.S. at 218) (first insertion in original).
Under the first step of the two-step analysis, these claims
seek to vindicate rights created solely by § 301 labor
contracts and are thus preempted. Kobold, 832 F.3d at 1032.
Garcia’s negligent misrepresentation and legal
malpractice claims allege that International officials misled
the Local Board regarding its rights under the Affiliation
Agreement and the Local Constitution. Under the second
step of the analysis, these claims are substantively, if not
entirely, dependent on the interpretation of a § 301 labor
contract and thus preempted. Id. The fact that the legal
malpractice claim includes a variety of non-contract-related
legal malpractice allegations, does not save the claim from
preemption, although those aspects of the claim are not
subsumed by § 301. Curtis v. Irwin Indus., Inc., 913 F.3d
1146, 1153 (9th Cir. 2019) (“[C]laims are only preempted to
16 GARCIA V. SEIU
the extent there is an active dispute over the meaning of the
contract terms.”) (quotation omitted).
Finally, Garcia’s breach of fiduciary duty claim alleges
that the International had a duty to members of the Local,
which it breached by making the above-mentioned
misrepresentations to the Local Board. Determining the
nature of the relationship between the International and
Local requires interpreting the Affiliation Agreement and
the International and Local Constitutions, and determining
whether there was misrepresentation of contract-based rights
requires the same core interpretation of § 301 labor contracts
as the other claims. This claim is thus also preempted.
* * *
The district court correctly determined that five of
Garcia’s claims required interpretation of a § 301 labor
contract, treated those claims as § 301 claims, and exercised
jurisdiction over those claims.
AFFIRMED.