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April 10, 1974

Gerald HAYES et al.

Fogel, District Judge.

The opinion of the court was delivered by: FOGEL

FOGEL, District Judge.

Gerald Hayes, Robert Will and Andrew Dambach, as purported representatives of a class allegedly consisting of all employees of C. Schmidt & Sons, Inc. (hereinafter referred to as plaintiffs), seek to compel their employer (hereinafter referred to as Schmidt) to make contributions to a Profit Sharing Plan maintained by Schmidt for the benefit of its employees.

 The action was originally brought in the Court of Common Pleas of Philadelphia County during the August Term, 1973, Docket No. 1810. Schmidt removed the case to this Court pursuant to the provisions of 28 U.S.C. § 1441, invoking our original jurisdiction over the controversy under § 301(a) of the Labor Management Relations Act of 1947, 61 Stat. 156, 29 U.S.C. § 185(a). Plaintiffs did not contest the removal.

 Schmidt subsequently filed a motion to dismiss the complaint for failure to state a claim upon which relief can be granted, pursuant to Rule 12(b) (6) of the Federal Rules of Civil Procedure.

 In an Order dated November 15, 1973, the Court, sua sponte, raised the question of federal subject matter jurisdiction, and directed that this issue, as well as Schmidt's motion to dismiss for failure to state a claim, be briefed and argued orally. Counsel thereafter submitted extensive memoranda pertinent to these issues.

 The relevant facts are not in dispute, and may be summarized as follows:

 For some years prior to 1972, Schmidt maintained a Profit Sharing Plan which provided for contribution by that company of a percentage of its profits for investment for the benefit of most, if not all of Schmidt's employees. *fn1" The Plan provided for amendment or discontinuance at any time by the company unilaterally, subject to the restriction that the corpus, in effect, was impressed with a trust for active and retired members. *fn2"

 In June, 1972, Schmidt entered into negotiations with Local 183 of the International Union of United Brewery, Flour, Cereal, Soft Drink and Distillery Workers of America, AFL-CIO, of which plaintiffs are members. The collective bargaining agreement which emerged from these negotiations contained the following provision with respect to the Profit Sharing Plan:




* * *


SECTION 4. Profit Sharing


The participation of the employees in the C. Schmidt & Sons, Inc. Profit Sharing Plan shall terminate as of June 20, 1972. Employees shall be entitled to receive the amount of money standing in their account as of the market value adjustment at the time without regard to the vesting provisions of the plan. Each employee may express a preference as to the method in which such money shall be distributed or held for his account, provided however, the final decision with respect to such distribution shall remain with the Profit Sharing Committee.

 While this provision of the collective bargaining agreement requires termination of the Plan as to the employees covered by the agreement, it does not specifically require a contribution to the Plan for the period from January 1 to June 30, 1972, and Schmidt concluded it was not required to do so. Plaintiffs thereupon filed the instant action in the Court of Common Pleas to compel such a contribution.

 In support of its argument that this Court has jurisdiction over the subject matter of the action, Schmidt argues that plaintiffs' claim, if it exists at all, must arise from Article VI, Section 4 of the collective bargaining agreement, because all parties agree that in the absence of this provision, the company would have had the unilateral right to terminate the Plan at will, and plaintiffs would not have had any present claim to the funds in the Plan. Thus, Schmidt contends that the action falls within the purview of § 301, which confers exclusive jurisdiction upon the District Courts of the United States to hear "[suits] for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce * * * without respect to the amount in controversy or without regard to the citizenship of the parties."

 Plaintiffs do not dispute the black letter proposition that federal jurisdiction would in fact attach if their claim arose out of the collective bargaining agreement. However, they contend that the claim arises from the underlying Profit Sharing Plan and not from the collective bargaining agreement, since the Plan predated not only Article VI, Section 4 of the 1972 agreement, but has continued in existence as to other employees who were not members of the plaintiffs' labor organization. *fn3" They also argue in support of their position that the action was brought in behalf of all Schmidt employees included in the Plan, and not just those covered by their collective bargaining agreement.

 If we do not have subject matter jurisdiction, then the case must be remanded to the Court of Common Pleas. Moreover, 28 U.S.C. § 1447(c) gives us the power, sua sponte, to remand the matter if it appears that the case was removed improvidently and that we lack jurisdiction, even in the absence of a motion to remand by any party. Rand v. State of Arkansas, 191 F. Supp. 20, 21 (W.D. Ark. 1961).

 If we determine that we do have jurisdiction over the action, we must then rule upon the motion to dismiss for failure to state a claim upon which relief can be granted, which motion is predicated on plaintiffs' alleged failure to exhaust the mandatory grievance and arbitration procedures established by the collective bargaining agreement. *fn4"

  As a preliminary matter, we note that the failure by plaintiffs to refer to § 301 in their state court complaint is not dispositive of the question of federal subject matter jurisdiction, since an action may be removed to the District Court when the real nature of the claim is federal, irrespective of the characterization given to it by plaintiffs. Geo. D. Roper Corporation, Newark Div. v. Local Union 16, 279 F. Supp. 717 (S.D. Ohio 1968); Fay v. American Cystoscope Makers, 98 F. Supp. 278 (S.D.N.Y. 1951); 1A Moore's Federal Practice P 0.167 [7]. If the rule were otherwise, the principle of federal preemption in this area of labor law could be demolished through litigants' election to omit mention of § 301 in the complaint. Avco Corp. v. Aero Lodge No. 735, Int. Ass'n of Mach. & Aero. W., 376 F.2d 337, 340 (6th Cir. 1967), aff'd, 390 U.S. 557, 88 S. Ct. 1235, 20 L. Ed. 2d 126 (1968). In the present case, plaintiffs deliberately skirted any reference to § 301 in the state court complaint, although they specifically referred to the collective bargaining agreement in that pleading, and attached relevant portions of the agreement as an exhibit. Our duty, however, is to examine the real nature of plaintiffs' claim, notwithstanding plaintiffs' attempted characterization of it as one based on state law rather than federal substantive labor law. If the action does in fact involve a purported violation of a contract between an employer and a labor organization in an industry affecting commerce, federal jurisdiction is properly grounded on § 301, irrespective of the label a party tries to affix.

 If plaintiffs' union had brought this action on their behalf, we would be compelled to conclude that the claim is within the broad jurisdictional mandate of § 301. A collective bargaining agreement exists, and one of its provisions arguably covers the disputed area. Federal jurisdiction exists, even though relief may ultimately be denied on the merits, because a resolution of the matter hinges upon the correct interpretation and application of the terms of the collective bargaining agreement. Chasis v. Progress Manufacturing Company, 382 F.2d 773, 776-777 (3d Cir. 1967); Roadway Express, Inc. v. General Teamsters, Local 249, 330 F.2d 859, 861 (3d Cir. 1964). See Bell v. Hood, 327 U.S. 678, 66 S. Ct. 773, 90 L. Ed. 939 (1946).

 Similarly, if the named plaintiffs had brought the action in their own behalf alone, or if the class consisted only of members of their labor organization, federal jurisdiction would also attach, under the rule of Smith v. Evening News Association, 371 U.S. 195, 83 S. Ct. 267, 9 L. Ed. 2d 246 (1962), subject, of course, to the limitations imposed in Republic Steel Corporation v. Maddox, 379 U.S. 650, 85 S. Ct. 614, 13 L. Ed. 2d 580 (1965).

 In the instant case, however, plaintiffs purport to represent all of the employees of Schmidt who were members of the Plan, and not just the members of plaintiffs' union. This could include members of the Teamsters Local 830, perhaps members of other labor organizations which are covered by separate collective bargaining agreements not now before us, and also non-union managerial employees. Therefore, we will deny, without prejudice, Schmidt's motions to dismiss at this time, but instead will proceed to a class action determination pursuant to Rule 23(c) of the Federal Rules of Civil Procedure and then to a definitive determination with respect to the appropriate forum to entertain this litigation. *fn5"

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