Title: Clark v. Service Employees International Union

State: nevada

Issuer: Nevada Supreme Court

Document:

487 Nev, Advance Opinion 10
IN THE SUPREME COURT OF THE STATE OF NEVADA

ROBERT CLARKE, AN INDIVIDUAL, No, 80520
Appellant,

vs.

SERVICE EMPLOYEES

INTERNATIONAL UNION, AN FILED
UNINCORPORATED ASSOCIATION;

AND NEVADA SERVICE EMPLOYEES SEP 16 20
UNION, A/K/A CLARK COUNTY hen wele,
PUBLIC EMPLOYEES ASSOCIATION, tS

SEIU 1107, A NONPROFIT °° arer ero CLE
COOPERATIVE CORPORATION,

Respondents.

‘SERVICE EMPLOYEES:
INTERNATIONAL UNION, AN
UNINCORPORATED ASSOCIATION;
AND NEVADA SERVICE EMPLOYEES
UNION, A/K/A CLARK COUNTY
PUBLIC EMPLOYEES ASSOCIATION,
SEIU 1107, A NONPROFIT.
COOPERATIVE CORPORATION,
Appellants,

vs.

DANA GENTRY, AN INDIVIDUAL;
AND ROBERT CLARKE, AN
INDIVIDUAL,

Respondents. 3]

No, 81166

 

 

Consolidated appeals from district court orders granting
summary judgment and denying post-judgment motions for attorney fees in
an employment matter. Highth Judicial District Court, Clark County;
Gloria Sturman, Judge.

 

  

 

 
Affirmed in part, reversed in part, and remanded (Docket No.
80520); affirmed in part, vacated in part, and remanded (Docket No. 81166).

McAvoyAmaya & Revero and Michael J. McAvoyAmaya, Las Vegas,
for Appellant/Respondent Robert Clarke and Respondent Dana Gentry.

Christensen James & Martin and Evan L. James, Las Vega’
for Respondent/Appellant Nevada Service Employees Union.

 

Rothner, Segall & Greenstone and Jonathan M. Cohen, Maria Keegan
Myers, and Glenn Rothner, Pasadena, California,
for Respondent/Appellant Service Employees International Union.

 

BEFORE THE SUPREME COURT, EN BANC.

OPINION

By the Court, CADISH, J.

These consolidated appeals arise from the termination of
appellant’s employment with the Nevada Service Employees Union. The
main issue in the appeal in Docket No. 80520 concerns whether appellant's
wrongful termination claims against the union respondents were conflict-
preempted by the Labor Management Reporting and Disclosure Act
(LMRDA), which promotes union democracy. Applying principles of conflict
preemption, we hold that because Nevada's wrongful termination claims do
not significantly conflict with any concrete federal interest expressed by the
LMRDA, the LMRDA does not preempt these claims. Additionally, because
appellant failed to show that a genuine dispute of material fact existed
regarding his alter ego theory of liability, the district court did not err when.

it granted summary judgment in favor of one of the union respondents on

 

 

eae
that ground. As to the attorney fees issue in Docket No. 81166, we conclude
that the district court acted within its discretion when it denied a union
respondent's motion for attorney fees because rejection of the unions’
unclear offers of judgment was not grossly unreasonable.
FACTS

Nevada Service Employees Union, Loca! 1107 is the Nevada
chapter of Service Employees International Union (SEIU) (collectively the
Unions). In August 2016, Local 1107 hired Robert Clarke as Director of
Finance and Human Resources for the union, pursuant to an employment
contract. In this senior level position, Clarke was responsible directly to the
Local 1107 president, Cherie Mancini. The employment contract contained
a for-cause termination provision stating that “[tlermination of this
employment agreement may be initiated by the [Local 1107] President for
cause.” A similar for-cause termination provision was contained in Locul
1107's employment contract with Dana Gentry for her position as
Communications Director. In performing their managerial duties with
Local 1107, both Clarke and Gentry attended weekly meetings with
Mancini and another employee, Peter Nguyen. Clarke, Gentry, and Nguyen
collectively constituted Local 1107's “managers” or “directors.”

In fall 2016, SEIU appointed a hearing master to hear

 

grievances against Mancini and to make recommendations regarding the
internal needs of Local 1107. In her April 2017 reports, the hearing master
concluded that “[t]he overal! pattern that emerges from the evidence is one
of a President willing, and even inclined, to sideline ker fellow officers so
that she can function autocratically or, at best, with a small cadre of staff
whose hiring was never even approved by the {Local 1107 Executive]
Board.” Because of the hearing master's reports, Local 1107's Executive
Board voted to have SEI impose a trusteeship over the chapter. The

 

 

 

 

 
—

trustees, who acted on behalf of Local 1107 once appointed by SEIU,
subsequently removed all board members from office, including Mancini,
and terminated Clarke's and Gentry’s employment."

Clarke and Gentry filed the underlying complaint against the
Unions, as well as against other defendants who are not named parties on
appeal, alleging breach of contract, breach of the implied covenant of good
faith and fair dealing, intentional interference with contractual relations,
wrongful termination, tortious discharge, and negligence (collectively the
wrongful termination claims). The Unions served an NRCP 68 offer of
judgment on Clarke and Gentry of $30,000 each, on behalf of all defendants,
to dismiss all claims. Clarke and Gentry did not accept the offer of
judgment, The Unions later moved for summary judgment, arguing that
the LMRDA preempted Clarke's and Gentry’s claims. SEIU also sought
it on the basis that it owed Clarke and Gentry no duty

 

 

summary judgm
because it had not employed them or entered into any employment contract
with either of them. In Clarke and Gentry’s opposition to those motions,
they asserted for the first time that SEIU was the alter ego of Local 1107.
‘The district court ultimately granted the Unions’ motions, concluding that
the LMRDA preempted all of Clarke's and Gentry’s claims. The court
further concluded that SEIU was entitled to summary judgment because it
had not employed or entered into a contract with Clarke or Gentry.

‘The Unions then moved for attorney fees based on their rejected
offer of judgment, which the district court denied. While the court found
that the offer of judgment complied with NRCP 68 and was reasonable in

"The Ninth Circuit Court of Appeals later upheld the trusteeship.
Garcia v. Serv. Emps. Int'l Union, Nos. 19-16863, 19-1693 & 19-16934,
2021 WL 1255616, at *2 (9th Cir. Apr. 5, 2021).

 

 

 

 
amount and timing. it also found that “it was not grossly unreasonable for
[Clarke and Gentry] to reject the Offer of Judgment because the Offer of
Judgment required a global resolution of all claims against all Defendants.”
Clarke, but not Gentry. appeals from the order granting summary
judgment, and the Unions appeal from the order denying their motion for
attorney fees.
DISCUSSION

The LMRDA does not preempt state law wrongful termination claims

We review questions of federal preemption and decisions
granting summary judgment de novo. Nanopierce Techs., Inc. v. Depository
Tr. & Clearing Corp., 123 Nev. 362, 370, 168 P.3d 73, 79 (2007) (explaining
that we review questions of federal preemption de novo); Wood v. Safeway,
Inc., 121 Nev. 724, 729, 121 P.3d 1026, 1029 (2005) (explaining that we
review decisions regarding summary judgment de novo). The Unions,
relying on Finnegan v. Leu, 456 U.S. 431 (1982), and Screen Extras Guild,
Inc, v. Superior Court, 800 P.24 873 (Cal. 1990), argue that Nevada law
wrongful termination claims conflict with the LMRDA's policy of ensuring
democratic governance of labor unions, and thus the LMRDA preempts
those wrongful termination claims, such that the district court properly
granted summary judgment in their favor. We disagree.

“[Whhen a conflict exists between federal and state law, valid
federal law overrides, ic, preempts, an otherwise valid state law.”
Nanopierce Techs., 123 Nev. at 370, 168 P.3d at 79. In preemption analysis,
courts must determine whether Congress expressly or impliedly intended
to preempt state law. Id. Although there are different types of preemption,
the only potentially applicable type of preemption in this matter—and the
only type argued by the Unions—is conflict preemption. In analyzing

whether conflict preemption applies, a court “examines the federal statute

5

 

 

 

 
ane

asa whole to determine whether a party's compliance with both federal and
state requirements is impossible or whether. in light of the federal statute's
purpose and intended effects, state law poses an obstacle to the
accomplishment of Congress's objectives.” Id. at 371-72, 168 P.2d at 80. In
other words, we ask “whether the act's purpose would be frustrated if state
law were to apply.” Id. at 375, 168 P.8d at 82. A general tension with the
broad or abstract goals of federal laws or programs is insufficient to warrant
conflict preemption. Commonwealth Edison Co. v. Montana, 453 U.S. 609,
633-34 (1981). Instead, courts should not displace state law unless there is
“significant conflict” between the operation of the state law and concretely
identifiable federal interests. Boyle v. United Techs. Corp., 487 U.S, 500,
607 (1988). As “[s}tates possess broad authority under their police powers
to regulate the employment relationship to protect workers within the
[sftate,” MGM Grand Hotel-Reno, Inc. v. Insley, 102 Nev. 513, 518, 728 P.2d
821, 824 (1986) (quoting Metro. Life Ins. Co. v. Massachusetts, 471 U.S. 724,
756 (1985), there must be a “clear and manifest” indication of Congress's
intent to preempt state law, Nonopierce Techs., 123 Nev. at 370-71, 168 P.34
lat 79 (quoting Bates v. Dow Agrosciences LLC, 544 U.S. 431, 449 (2005)
(explaining that “Congress's intent to preempt state law, in light of a strong

 

presumption that areas historically regulated by the states generally are
not superseded by a subsequent federal law, must be ‘clear and manifest”).

Clarke's wrongft! termination claims—both in contract and in
tort-are all based on his allegedly wrongful discharge from employment.
‘Thus, for his claims to be viable, we must first determine whether the
LMRDA, which has the goal of promoting union democracy, preempts
Nevada law wrongful termination claims. We conclude it does not.

 

 

 
In Finnegan, on which the Unions rely, a newly elected union
president fired several union business agents who, in their capacity a
supported a different candidate for union president. 456

 

union members,
US. at 433-34. Relying on the LMRDA, which protects union members’
political rights, the business agents filed suit in federal district court,
arguing that their firings were a form of “discipline” based on their exercise
of guaranteed political rights and thus prohibited under the LMRDA. Id.
at 437. The United States Supreme Court disagreed, holding that the
LMRDA's prohibition against discipline “refers only to retaliatory actions
that affect a union member's rights or status as a member of the union.” Id.
(emphasis in original). Because discharge from union employment does not
affect union member rights, the LMRDA did not prohibit the termination.
Id, at 438,

Further, the Supreme Court held that the LMRDA “does not
restrict the freedom of an elected union leader to choose a staff whose views
are compatible with his own.” Id, at 441. While acknowledging that “the
ability of an elected union president to select his own administrators” is an
important part of union governance and is not “inconsistent” with the
LMRDA’s goals, the Supreme Court recognized that “neither the language
nor the legislative history of the [LMRDA] suggests that it was intended
even to address the issue of union patronage.” Id. Finnegan, thus, did not
address a situation where, as here, a union employee has a for-cause

employment contract and asserts state law wrongful termination claims?

4ndeed, the Supreme Court has previously recognized that the
LMRDA generally does not preempt state causes of action and expressly
states when it intends to preempt state law. See De Veau v. Braisted, 363,
US. 144, 156 (1960) (acknowledging that “{tJhe [LMRDA], which reflects

 

  

 

 
oem

See id. at 442 (recognizing that “[nJothing in the [LMRDA] evinces a
congressional intent to alter the traditional pattern which would permit a
union president under these circumstances to appoint agents of his choice to
carry out his policies” (emphasis added). Nor did the Finnegan decision
hold or even imply that pursuing such claims would frustrate any federal
purpose or that complete and unfettered union patronage was a concretely
identifiable federal interest; to the contrary, the Supreme Court observed
that Congress was not even concerned with union patronage practices when
drafting the LMRDA. See id. at 441.

‘The other case on which the Unions rely, Screen Extras Guild,
does not require a different conclusion even though it does address
preemption. In Screen Extras Guild, a union business agent filed a
wrongful termination suit. 800 P.2d at 875. Applying a novel “substantive
or jurisdictional” preemption analysis, the California Supreme Court
concluded that there was an actual conflict between California's wrongful
termination cause of action and the LMRDA’s underlying policies. Id. at
875-77. The court in Screen Extras Guild acknowledged that the LMRDA's
primary objective is to ensure union democracy, as articulated in Finnegan.
Id. at 877. But from there, it reasoned that Finnegan determined that
“Congress must have intended that elected union officials would retain
unrestricted freedom to select business agents, or, conversely, to discharge
business agents with whom they felt unable to work or who were not in accord.
with their policies,” and thus the court concluded that “even ‘garden-variety’

congressional awareness of the problems of pre-emption in the area of labor
legislation, ... did not leave the solution of questions of pre-emption to
inference. When Congress meant pre-emption to flow from the [LMRDA] it
expressly so provided.”).

 

 

 

 
wrongful termination actions .... implicate the union democracy concerns of
the LMRDA.” Jd. at 877, 879 (emphasis added), We disagree.

[As discussed above, Finnegan does not stand for such a broad
application of the LMRDA. Finnegan did not hold that union officials may,
despite a for-cause employment agreement, “discharge business agents with
whom they felt unable to work or who were not in accord with their policies.”
Id. at 877. Its holding that termination of the employee in that case was
not inconsistent with the LMRDA’s goals does not support a logical leap to
the conclusion that the LMRDA requires unfettered union employee
termination in violation of generally applicable state law. Further, Sereen
Extras Guild never attempted to reconcile the Finnegan Court's
‘acknowledgment that the LMRDA was not “intended even to address the
issue of union patronage,” 456 U.S. at 441, with Supreme Court precedent
on preemption, which requires that Congress have a clear and manifest
intent to preempt state law in areas traditionally left to the state's police
power, Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947), How can
Congress show a clear and manifest intent to preempt state wrongful
termination claims by discharged union employees when it was not
concerned with union patronage at all? Simply, it cannot, and it did not do
so here. Thus, because there is no “clear and manifest” indication of
Congress's intent to preempt wrongful termination claims, Nanopierce
Techs., 123 Nev. at 370-71, 168 P.3d at 79, nor a “significant conflict”
between the operation of state law and a concrete federal interest, Boyle,
487 U.S. at 507, we reject the California approach and hold that the LMRDA.

 

 

 
does not preempt Nevada wrongful termination claims.? Accordingly, the
district court erred in entering summary judgment in favor of the Unions
on conflict-preemption grounds.‘

Clarke failed to show that @ genuine dispute of material fact existed to
preclude summary judgment in favor of SEIU

‘The Unions argue that Clarke failed to show sufficient evidence
to support his purported alter ego claim against SEIU. Assuming without
deciding that Clarke sufficiently pleaded his alter ego claim, we agree that
he failed to show sufficient evidence to survive summary judgment.

To demonstrate alter ego status, one must show “that the
subsidiary corporation is so organized and controlled, and its affairs are so
conducted that it is, in fact, a mere instrumentality or adjunct of another
corporation.” Bonanza Hotel Gift Shop, Inc. v. Bonanza No. 2, 95 Nev. 463,
466, 596 P.2d 227, 229 (1979) (internal quotations omitted). Alter ego
liability is established when a preponderance of the evidence show:

 

(1) The corporation must be influenced and
governed by the person asserted to be its alter ego;
(2) There must be such unity of interest and
ownership that one is inseparable from the other;
and (3) The facts must be such that adherence to
the fiction of separate entity would, under the

8This conclusion is consistent with the LMRDA’s express non-
preemption provision. See 29 U.S.C. § 523(a) (2019) (“Except as explicitly
provided to the contrary, nothing in this chapter shall reduce or limit the
responsibilities of any labor organization ... under any other Federal law
or under the laws of any State ....”).

“The dissent misinterprets our holding. We do not require the trustee,
or an elected union president, to continue a union employee's employment.
Instead, we merely hold that, if a trustee or union employer terminates a
union employee who has a for-cause employment contract, that employee's
wrongful termination action is not preempted by the LMRDA. We express
no opinion on the merits of the claims asserted by Clarke or Gentry.

 

10

 

 

 

 
circumstances, sanction a fraud or promote
injustice,
Truck Ins. Exch. v. Palmer J. Swanson, Inc., 124 Nev. 629, 635, 189 P.3d

656, 660 (2008) (internal quotation omitted).

Here, the record does not show that there was a unity of interest
or ownership between SEIU and Local 1107. Generally, the commingling
of funds, shared operations, shared headquarters, shared bank accounts, or
failure to observe corporate formalities shows unity of interest or
ownership. Truck Ins. Exch., 124 Nev. at 635-36, 189 P.3d at 660-61;
Bonanza, 95 Nev. at 467. 596 P.2d at 230. Local 1107 maintained its own
accounts and was financed by its members, not SEIU. The trustees utilized
Local 1107's headquarters and finances during the trusteeship. There is no
evidence SEIU and the trustees or Local 1107 were inseparable from one
another. Further, the Ninth Circuit upheld the imposition of the
trusteeship. Thus, the trusteeship wé

 

not the progeny of fraud or injustice.
Moreover, there is no evidence that SEIU imposed the trusteeship over

Local 1107 for unlawful or unjust purposes, or that Clarke was under the

 

mistaken impression that SEIU was actually his employer or would be
responsible to him under his employment contract. Accordingly, we
conclude that there were no genuine issues of material fact regarding the
second or third elements of alter ego liability. Wood, 121 Nev. at 729, 121
P.3d at 1029. Thus, the district court did not err when it granted summary
judgment in SEIU’s favor. See Hannam v. Brown, 114 Nev. 350, 357, 956
P.2d 794, 799 (1998) (“[T]his court will affirm the order of the district court,
if it reached the correct result, albeit for different reasons.” (internal
quotation omitted)),

tt

 

 

 

 
‘The district court did not abuse its discretion in denying SEIU’s motion for
attorney fees

Because the district court properly granted summary judgment
on the claims against SEIU, we must consider whether the district court
abused its discretion in denying SEIU’s motion for attorney fees.* NRCP
68(c) permits multiple offerors to make an offer of judgment to multiple
offerees. Under NRCP 68(), an offeror may recover its reasonable post-offer
attorney fees if the offeree rejected its offer of judgment and did not obtain
a more favorable judgment. Before awarding attorney fees under this rule,
the district court must consider the four Beattie factors:

(1) whether the plaintiff's claim was brought in
good faith; (2) whether the defendant['s} offer of
judgment was reasonable and in good faith in both
its timing and amount; (3) whether the plaintiff's
decision to reject the offer and proceed to trial was
grossly unreasonable or in bad faith; and
(4) whether the fees sought by the offeror are
reasonable and justified in amount.

Beattie v. Thomas, 99 Nev. 579, 688-89, 668 P.2d 268, 274 (1983). “[NJo one
factor under Beattie is determinative and (the district court] has broad

 

 

discretion to grant the request so long as all appropriate factors are
considered.” Yamaha Motor Co., U.S.A. v. Arnoult, 114 Nev. 233, 252 n.16,
955 P.2d 661, 673 n.16 (1998).

‘The district court found that it was “not grossly unreasonable”
for Clarke and Gentry to reject the offer of judgment because the offer

required a global resolution of all claims and it was unclear to the court

"Because we reverse the summary judgment in Local 1107's favor and
remand for further proceedings, we necessarily vacate the district court's
order denying Local 1107's motion for attorney fees based on a rejected offer
of judgment. See NRCP 88(f)

 

gate

 

 

 
smn

“how the [p]laintiffs could have properly analyzed the Offer of Judgment.”
In regard to lack of clarity, the record supports the district court’s findings
that (1) it would be impossible for either Clarke or Gentry to settle only with
one of the defendants, if they felt inclined to do so, because the offer required
both plaintiffs to settle with all defendants; (2) the offer required dismissal
of all claims against all defendants even though one of the defendants was
unrepresented by counsel and unaware of the offer; and (3) the offer did not
state who would pay Clarke and Gentry if the offer were accepted. As the
record supports the district court's conclusion that it was not grossly
unreasonable for Clarke and Gentry to reject the offer on the basis that it
lacked clarity, we perceive no abuse of discretion in its decision denying
SEIU's motion for attorney fees. Gunderson v. D.R. Horton, Inc., 130 Nev.
67, 80, 319 P.3d 606, 615 (2014) (reviewing a district court's decision

 

denying attorney fees for an abuse of discretion).
CONCLUSION

The LMRDA does not preempt Nevada wrongful termination
claims, because permitting such claims would not frustrate the purpose of
the LMRDA. Thus, the district court erred in granting summary judgment
on Clarke's claims based on preemption. As Clarke failed to show that a
genuine dispute of material fact existed regarding his alter ego theory of
liability, the district court properly entered summary judgment in favor of
SEIU because SEIU did not otherwise employ Clarke. Finally, the record
supports the district court's finding that it was not grossly unreasonable for
Clarke and Gentry to reject SEIU’s offer of judgment, and thus, the court
did not abuse its discretion by denying SEIU’s motion for attorney fees.
Accordingly, we reverse the district court's order in Docket No. 80520 to the

extent that it granted summary judgment on the basis that the LMRDA

 

preempted Clarke's wrongful termination claims and remand for further

13

 

 

 
proceedings as to those claims. However, we affirm the portion of the
district court’s order in Docket No. 80520 granting summary judgment in
favor of SEIU because even assuming the claim was properly pleaded,
Clarke nevertheless failed to show a genuine dispute of material fact as to
his alter ego theory of liability and SEIU did not employ or have an
employment contract with Clarke. Finally, we affirm the district court's

 

order denying SEIU’s motion for attorney fees and vacate and remand the
order denying Local 1107's motion for attorney fees in Docket No. 81166.

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HERNDON, J., with whom PARRAGUIRRE and SILVER, JJ., agree,
concurring in part and dissenting in part:

concur with the decision to affirm the denial of the motions for
attorney fees in Docket No. 81166. I disagree, however, with the majority's
decision that the district court erred in granting summary judgment on the
ground that the LMRDA preempted Clarke's action in Docket No. 80520.

‘The majority takes a very narrow view of what poses an
obstacle to the accomplishment of Congress's objective in enacting the
LMRDA. The Local 1107 Executive Board voted to have SEIU impose a
trusteeship over the chapter after an independent hearing master
concluded that there was a pattern of “a President willing, and even
inclined, to sideline her fellow officers so that she can function
autocratically or, at best, with a small cadre of staff whose hiring was never
even approved by the [Local 1107 Executive] Board.” SEIU imposed the
trusteeship in an effort to return the Local 1107 to a position where the
democratic process would sufficiently protect and progress the union
ng this purpose, SEIU’s 2016

constitution and bylaws authorized a trustee to remove employees and

 

members’ needs and rights. In achi

 

appoint new employees.

‘There was no question that the small cadre of staff hired by the
Local’ 1107 president was loyal to the president and not interested in
progressing the purpose and objectives of the union. These employees,
including appellant Robert Clarke, exchanged numerous text messages

critical of the trusteeship, referring to the trustees as “slimy aimrods” and

'Because I conclude the LMRDA preempted Clarke's claims against
the SEIU, it is unnecessary to consider whether Clarke could maintain an
alter ego theory of liability against the SEIU.

 

 

 

 
“twiddle dee and twiddle dumb.” They also issued a press release stating
the imposition of the trusteeship was illegal, “repugnant and holy [sic]
unjustified.” It would be infeasible for a trustee, or even a newly elected
president, to work with these employees to restore democracy to the union.
To limit a newly elected union official's, or in this case an appointed
trustee's, ability to replace existing staff with those whose ideologies and
goals aligned with the official's, and thus with the voting union members’
ideologies and goals, would only hamper the democratic process of the
union. The clear and manifest purpose of the LMRDA is to protect and
guarantee the democratic processes of unions. Thus, it is difficult to see
how the LMRDA would not preempt a wrongful termination action in these
circumstances.

Tam not alone in concluding that in such instances, the LMRDA
preempts state wrongful termination actions. In fact, the majority does not
cite to any decision supporting its conclusion because it is contrary to every
published decision considering this issue. See Screen Extras Guild, Inc. v.
Superior Court, 800 P.2d 873, 880 (Cal. 1990); Packowski v. United Food &
Commercial Workers Local 951, 796 N.W.2d 94, 104 (Mich. Ct. App. 2010)
(recognizing that “the cases finding preemption under similar
circumstances are more numerous, more factually analogous, and more
persuasive than the cases finding no preemption by the LMRDA of similar
wrongful-discharge claims’); Vitullo v. Int'l Bhd. of Elec. Workers, Local
206, 75 P.3d 1250, 1255 (Mont. 2003) (providing that “a state law which
interferes with the longstanding practice of union patronage, established in
the union's democratically enacted constitution, is not only contrary to the
overall purpose and objective of the LMRDA ..., but is in direct conflict

 

 

he es

 
with the democratic process that Congress sought to protect”); Dzwonar v.
McDevitt, 791 A.24 1020, 1024-26 (N.J. Super. Ct. App. Div. 2002).

‘The preeminent case on the matter comes from California and
was relied on by the district court here. In Screen Extras Guild, Inc. v.
Superior Court, Barbara Smith was terminated from her management job
with the Screen Actors Guild, and she sued the labor union and the chief
administrative officer of the union for wrongful discharge. 800 P.2d at 875.
Relying on Finnegan v. Leu, 456 U.S. 431 (1982), the California Supreme
Court concluded that “the strong federal policy favoring union democracy,
embodied in the LMRDA, preempts state causes of action for wrongful
discharge or related torts when brought against a union-employer by its
former management or policymaking employee.” Screen Extras Guild, 800
P.2d at 874. The court determined that Congress intended “elected union
officials [to] be free to discharge management or policymaking personnel”
because “policymaking and confidential staff are in a position to thwart the
implementation of policies and programs advanced by elected union
officials.” Jd. at 880. Thus, “[t]o allow a state claim for wrongful discharge

"In addition to these cases, a few jurisdictions have implicitly
concluded that the LMRDA preempted the state law claim but based their
holdings on a determination that the employee did not qualify as a
policymaking or confidential employee. Shuck v. Int'l Ass'n of Machinists &
Aerospace Workers, Dist. 837, 2017 WL 908188 (E.D. Mo., Mar. 7, 2017)
(refusing to adopt California's broad protection for all wrongful termination
actions against unions and concluding that the subject employee was not a
confidential employee because she was an administrative assistant); Lyons
v. Teamsters Local Union No. 961, 903 P.2d 1214, 1220 (Colo. Ct. App.
1995); Young v. Int'l Bhd. of Locomotive Eng’rs, 683 N.E.2d 420 (Ohio Ct.
App. 1996) (concluding the employee was not a policymaking or confidential
employee, but appearing to recognize that if the employee was, the cause of
action would be preempted by the LMRDA).

 

   

 

 
to proceed from the termination of a union business agent by elected union
officials would interfere with the ability of such officials to implement the
will of the union members they represent” and “would frustrate full
realization of the goal of union democracy embodied by the LMRDA.” Id. at
881. In the 30 years since Screen Extras Guild was decided, no court, in a
published opinion, has reached an opposite conclusion.

While I recognize Finnegan did not address the underlying type

 

of case, I disagree with the majority's portrayal of the U.S. Supreme Court's
analysis of the LMRDA. The U.S. Supreme Court's language strongly
indicates that the LMRD’s purpose of ensuring union democracy requires
that an elected union official be able to freely choose his or her staff. 456
ULS. at 441-42 (concluding that “Congress simply was not concerned with
perpetuating appointed union employees in office at the expense of an
elected president's freedom to choose his own staff’). The court recognized
that “the ability of an elected union president to select his own
administrators is an integral part of ensuring a union administration's
id, at 441, which
ensures the democracy of unions and is the clear and manifest purpose of
the LMRDA.

responsiveness to the mandate of the union electio

 

In a democracy, it would be difficult, if not impossible, for an
lected official to meet the goals on which the official ran for election if

 

saddled with a prior official's staff. The majority's conclusion to the contrary
creates a clear obstacle to the accomplishment of Congress's objective in
enacting the LMRDA to protect the democratic processes of unions.
Nothing could be more evident of this than requiring a trustee, appointed
to return a local chapter to an effective democracy, to continue the

‘employment of a union emplcyee involved in obstructing the loesl chapter's

 

 

 

 
Seo case

on

democracy merely because the previous president entered into a for-cause
employment contract with the employee.

‘Therefore, I conclude the district court did not err in granting
the union's motion for summary judgment because the LMRDA preempts
Clarke's action. Accordingly, I dissent because I would affirm the district
court's decision in Docket No. 80520.

ye Se

 

 

J
Herndon
We concur:
4K ae
Parraguirre
Silver :
5