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Krashna v. Oliver Realty Inc.

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT


February 2, 1990

MATTHEW KRASHNA AND TAMARA D. KRASHNA, HIS WIFE, APPELLANTS
v.
OLIVER REALTY, INC., GRANT BUILDING INC., A/K/A GRANT BUILDING AND SUSAN L. NIEDBALA

On Appeal from the United States District Court for the Western District of Pennsylvania, D.C. Civil Action No. 87-1899.

Higginbotham, Chief Judge.

Author: Higginbotham

HIGGINBOTHAM, Chief Judge.*fn1

Before filing an answer, defendants filed a timely notice of removal in the United States District Court for the Western District of Pennsylvania, asserting that the non-derivative state claims were completely preempted by § 301 of the Labor Management Relations Act (LMRA), 29 U.S.C. § 185 (1982). After Krashna filed a motion to remand, defendants sought summary judgment, which was granted by the district court in favor of all defendants on all claims.*fn2 This appeal followed.

We have jurisdiction under 28 U.S.C. § 1291 (1982). Our review is plenary.

II.

Removal of civil actions from state to federal court is governed by 28 U.S.C.A. § 1441 (West 1973 & Supp. 1989). Section 1441(a) provides in part:

Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the . . . defendants[] to the district court of the United States for the district and division embracing the place where such action is pending.

Because there is no diversity of citizenship between the parties, original jurisdiction must rest on a federal question. Caterpillar Inc. v. Williams, 482 U.S. 386, 392, 96 L. Ed. 2d 318, 107 S. Ct. 2425 (1987).

Under the federal question statute, the district courts have original jurisdiction of all civil actions "arising under the . . . laws . . . of the United States." 28 U.S.C. § 1331 (1982). As we have stated, "In order for a case to be removable under § 1441 and § 1331, the well-pleaded complaint rule requires the federal question be presented on the face of the plaintiff's properly pleaded complaint." Railway Labor Executives Ass'n v. Pittsburgh & L.E.R.R., 858 F.2d 936, 939 (3d Cir. 1988) (citation omitted); see Caterpillar, 482 U.S. at 392. "The rule makes the plaintiff the master of the claim; he or she may avoid federal jurisdiction by exclusive reliance on state law." Id. It follows that an action may not be removed on the basis of a federal defense, even ordinary preemption. Id. at 393; see Railway Labor, 858 F.2d at 941-42.

Nonetheless, under an exception to the well-pleaded complaint rule known as the complete preemption doctrine, the preemptive force of a statute can be "so 'extraordinary' that it 'converts an ordinary state common-law complaint into one stating a federal claim for purposes of the well-pleaded complaint rule.'" Caterpillar, 482 U.S. at 393 (quoting Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 65, 95 L. Ed. 2d 55, 107 S. Ct. 1542 (1987)). "The complete preemption doctrine holds that 'Congress may so completely preempt a particular area, that any civil complaint raising this select group of claims is necessarily federal in character.'" Railway Labor, 858 F.2d at 939 (quoting Metropolitan Life, 481 U.S. at 63-64). For the purposes of removal, "[once] an area of state law has been completely preempted, any claim purportedly based on that preempted state law is considered, from its inception, a federal claim, and therefore arises under federal law." Caterpillar, 482 U.S. at 393; see Railway Labor, 858 F.2d at 939.*fn3

We have recently identified two factors that are necessary for "a federal court in a case removed from a state court . . . to recharacterize what purports to be a state law claim as a claim arising under a federal statute." Railway Labor, 858 F.2d at 942. First, "the statute relied upon by the defendant as preemptive [must] contain[] civil enforcement provisions within the scope of which the plaintiff's state claim falls." Id.; see Aaron v. National Union Fire Ins. Co., 876 F.2d 1157, 1165 (5th Cir. 1989). The federal statute must subsume the interest vindicated by the state law, not the remedy provided. Railway Labor, 858 F.2d at 942 & n. 2; see Allstate Ins. Co. v. 65 Sec. Plan, 879 F.2d 90, 93 (3d Cir. 1989). Second, there must be "a clear indication of a Congressional intention to permit removal despite the plaintiff's exclusive reliance on state law." Railway Labor, 858 F.2d at 942; see Allstate, 879 F.2d at 93; see also Aaron, 876 F.2d at 1165.

A.

Because Krashna's complaint relies solely on state law, the well-pleaded complaint rule would ordinarily bar removal of this action. As we have noted, however, removal is proper if § 301 of the LMRA completely preempts Krashna's state law claims. Krashna's claims of intentional infliction of emotional distress and tortious interference with contract are clearly outside the scope of the collective bargaining agreement and § 301 of the LMRA. The question remains whether the claim of wrongful discharge and interference with a statutory right to benefits under the state worker's compensation law is completely preempted.

Our analysis begins with consideration of the scope of § 301 with respect to the state law claim. Railway Labor, 858 F.2d at 942. The LMRA's civil enforcement provision grants a broad right of action: "Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce . . . may be brought in any district court of the United States having jurisdiction of the parties. . . ." 29 U.S.C. § 185(a) (1982).

Complete preemption under § 301 was first outlined in Avco Corp. v. Machinists, 390 U.S. 557, 20 L. Ed. 2d 126, 88 S. Ct. 1235 (1968). In Avco, an employer brought an action in state court to enjoin a union from striking in violation of a collective bargaining agreement. After a preliminary injunction was granted, the union removed the action to federal court where the injunction was dissolved. In affirming the removal, the Court held that "the preemptive force of § 301 is so powerful as to displace entirely any state cause of action 'for violation of contracts between an employer and a labor organization.'" Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 23, 77 L. Ed. 2d 420, 103 S. Ct. 2841 (1983) (footnote omitted).

Although the complaint here fails to state an LMRA claim on its face, that is not dispositive. The issue turns on whether the state claim is properly viewed as one for wrongful discharge or for interference with the right to benefits under The Pennsylvania Workmen's Compensation Act.

If viewed as a wrongful discharge claim, we believe the state claim in this case would be completely preempted. First, the claim would be encompassed by the LMRA enforcement provision. As noted, the terms of Krashna's employment were governed by a collective bargaining agreement that permitted termination for just cause. Wrongful discharge, as averred in this complaint, would violate § 301 of the LMRA. In addition, there has been no challenge to personal jurisdiction or the requirement of "affecting commerce".*fn4 Second, the Supreme Court has determined that Congress intended to permit removal of claims subsumed within § 301 despite their exclusive reliance on state law. See Avco, 390 U.S. at 559-62.

Nonetheless, we do not believe this action can properly be viewed as a claim of wrongful discharge because its essence is a course of conduct interfering with Krashna's right to benefits under The Pennsylvania Workmen's Compensation Act. Krashna's complaint alleges that his unlawful treatment began after he filed for worker's compensation benefits. The discharge, even if wrongful, merely culminated the illegal course of conduct. Krashna avers that his filing precipitated a multifaceted course of harassment.*fn5 After the worker's compensation hearing, he alleges that Susan Niedbala angrily confronted him and accused him of malingering (P 13). Finally, and most importantly, Krashna was discharged, allegedly in retaliation for his filing.*fn6 We also note that Krashna styled his claim "Wrongful Discharge and Interference with a Statutory Right" rather than simply "Wrongful Discharge".

Because the conduct complained of concerns much that preceded the discharge and because Krashna expressly sought vindication of interests independent of those embodied in the collective bargaining agreement, we believe that his state claim exceeds the scope of his rights under the LMRA.*fn7 Accordingly, § 301 of the LMRA does not completely preempt this state claim.

III.

We hold that the district court lacks removal jurisdiction of this action and that the action should be remanded to state court. We will reverse the order of the district court and remand to that court with instructions that it remand the action to the state court from which it was removed.

Each side to bear its own costs.


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