Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_07-cv-06243/USCOURTS-cand-3_07-cv-06243-4/pdf.json

Nature of Suit Code: 720
Nature of Suit: Labor Management Relations Act
Cause of Action: 28:1441 Petition for Removal

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United States District Court

For the Northern District of California

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

L.M. BOCCIGNONE,

Plaintiff,

 v.

SUTTER HEALTHCARE, et al.,

Defendants. /

No. C 07-06243 CRB

ORDER OF REMAND

The Court previously ruled that defendants properly removed this lawsuit from state

court because the removed complaint stated a federal question, namely, a claim preempted by

ERISA. Plaintiff subsequently amended her complaint to eliminate the ERISA preempted

claim. In an Order filed March 7, 2008, the Court indicated that it intends to decline

supplemental jurisdiction and remand the action if the current complaint (the Fourth

Amended Complaint) does not state a federal claim. It ordered defendants to advise the

Court in writing if they believe the Fourth Amended Complaint states a federal question and,

if so, to submit a brief setting forth reasons. Now pending before the Court is defendants’

response.

Defendants contends that the first and second causes of action are completely

preempted by the Labor Management Relations Act (“LMRA”) and therefore the current

complaint states a federal claim. Plaintiff alleges that in order to encourage plaintiff to work

for defendant following her graduation from nursing school, defendants promised to repay

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her nursing school loans. After she completed one year of employment, however, defendants

declined to repay any part of her loans on the ground that she was not eligible because a

written disciplinary action had been taken against her. Plaintiff contends that defendants

never advised her that the loan forgiveness program was not available to nurses who receive

written disciplinary action. Based on these allegations she makes a claim for negligent

misrepresentation (first cause of action) and breach of oral contract (second cause of action). 

Defendants contend these causes of action are preempted by the LMRA as it is undisputed

that plaintiff’s employment was covered by a collective bargaining agreement.

Section 301 of the LMRA establishes federal jurisdiction for “[s]uits for violation of

contracts between an employer and a labor organization.” 29 U.S.C. § 185(a). The LMRA

therefore preempts any state cause of action for breach of a collective bargaining agreement. 

See Jimeno v. Mobil Oil Corp., 66 F.3d 1514, 1522 (9th Cir. 1995). “Despite the breadth of

§ 301 complete preemption, not every claim which requires a court to refer to the language of

a labor-management agreement is necessarily preempted.” Balcorta v. Twentieth

Century-Fox Film Corp., 208 F.3d 1102, 1108 (9th Cir. 2000) (internal quotation marks and

citation omitted). Rather, federal preemption is mandated only if the application of state law

requires interpretation of a collective bargaining agreement. See Lingle v. Norge Division of

Magic Chef, Inc., 486 U.S. 399, 413 (1998). The term “interpret,” within the context of

section 301 complete preemption, requires more than merely looking at, considering,

referring to, or applying the terms of the agreement. See Balcorta, 208 F.3d at 1108. It is the

“legal character of a claim, as ‘independent’ of rights under the collective-bargaining

agreement, (and not whether a grievance arising from ‘precisely the same set of facts’ could

be pursued), that decides whether a state cause of action may go forward.” Livadas v.

Bradshaw, 512 U.S. 107, 123-24 (1994). 

Defendants argue that because plaintiff’s position was covered by a collective

bargaining agreement, her claims are preempted. As support for this broad assertion of

LRMA jurisdiction, defendant relies on Young v. Anthony’s Fish Grottos, 830 F.2d 993 (9th

Cir. 1987). In Young, the plaintiff alleged that she agreed to return to work for the defendant

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based on the employer’s oral promise that she could return to work on the same terms as she

had before and that she could only be terminated for cause. The day she reported to work

defendant terminated her employment and plaintiff sued for breach of an oral agreement. 

The collective bargaining agreement covering her employment provided that an employee is

on probation for the first 30 days of work and during that probationary period can be

discharged at will. Id. at 996. The Ninth Circuit held that the plaintiff’s breach of contract

claims were preempted by the LMRA because the subject matter of her alleged contract–the

terms of her employment–is covered by the collective bargaining agreement. Id. at 997. 

“Because any ‘independent agreement of employment [concerning that job position] could be

effective only as part of the collective bargaining agreement, the CBA controls and the

contract claim is preempted.” Id. (internal quotation marks and citation omitted).

Defendants appear to read Young as holding that any contract claim by an employee

covered by a collective bargaining agreement is preempted, so long as the alleged contract

has something to do with the employment. The Court does not read Young so broadly. First,

to do so would contradict the Supreme Court’s teaching that federal preemption applies only

if the state law claim is for breach of a collective bargaining agreement or requires

interpretation of such an agreement. Lingle, 486 U.S. at 413; see also Cramer v.

Consolidated Freightways, Inc., 255 F.3d 683, 690 (9th Cir. 2001) (explaining that the

Supreme Court has held that “complaints of employees covered by a CBA are not preempted

if their claims are unrelated to the terms of the CBA,” and that the Court has specifically

rejected the contention that “all employment-related matters involving unionized employees

be resolved through collective bargaining and thus be governed by a federal common law

created by § 301”) (internal quotation marks and citation omitted). 

Second, in Young the plaintiff’s contract claim directly contradicted the terms of the

collective bargaining agreement; for the plaintiff to prevail the terms of the collective

bargaining agreement would have to be ignored. In other words, the plaintiff’s claim was not

“entirely independent of any understanding embodied in the collective-bargaining agreement

between the union and the employer.” Livadas, 512 U.S. at 124-25.

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Here, in contrast, defendants do not argue that there is anything in the collective

bargaining agreement governing plaintiff’s employment that remotely addresses her claim

here; namely, the promise to repay her loans. While there is evidence that defendants had a

loan forgiveness program, there is no evidence that this program was negotiated between the

union and the employer and was in any way part of the collective bargaining agreement. 

Accordingly, plaintiff’s claim that defendant negligently misrepresented the terms of the loan

forgiveness program (first cause of action) and her claim that the loan repayment promise did

not include a written disciplinary action condition (second cause of action) are not

preempted; neither claim contradicts the terms of the collective bargaining agreement nor

otherwise requires interpretation of the collective bargaining agreement, at least to the extent

the claims do not challenge the discipline imposed. See Cramer, 255 F.3d at 691. The fact

that the subject of loan forgiveness could have been made a part of the collective bargaining

agreement is irrelevant. Id. at 692.

Defendants’ reliance on Beals v. Kiewit Pacific Co., 114 F.3d 892 (9th Cir. 1997) is

equally unpersuasive. The court held that to the extent the terms of the allegedly

independent agreement are inconsistent with the collective bargaining agreement, the

collective bargaining agreement controls. Id. at 894. Again, defendants offer no evidence

that plaintiff’s claim of an agreement to repay her loans contradicts anything in the collective

bargaining agreement controlling her employment.

In a footnote defendants observe that in plaintiff’s first cause of action for negligent

misrepresentation plaintiff appears to be challenging the written disciplinary action itself. 

She contends that defendants told her that no disciplinary action would be taken for an

inadvertent act before July 2006, Fourth Amended Complaint ¶ 64, and, apparently, that she

does not recall receiving any written disciplinary action until defendants cited it to her as a

reason for not repaying her loans. Id. at ¶ 65.

It is unclear whether plaintiff is alleging the representation as to a lack of disciplinary

action as a basis for her negligent misrepresentation claim; the Court’s reading of the first

cause of action suggests that it is based solely on the misrepresentation as to the eligibility

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G:\CRBALL\2007\6243\orderofremand.wpd 5

for the loan forgiveness program and not on an additional misrepresentation as to when

disciplinary action could be taken. Even if the claim were also based on the additional

alleged misrepresentation of no disciplinary action for the first six months, however,

defendants have not met their burden of proving that such a claim is completely preempted. 

Defendants have not even attempted to show that such a claim involves disputed terms of the

governing collective bargaining agreement. Beals, 114 F.3d at 895. In Beals, for example,

the plaintiff made a negligent misrepresentation claim based on an alleged representation that

was directly contradicted by the terms of the collective bargaining agreement. Because the

plaintiff did not challenge the meaning of the collective bargaining agreement, the Ninth

Circuit held that resolution of the plaintiff’s misrepresentation claim did not require

interpretation of the agreement and was therefore not preempted. Id. Here, too, defendants

have not met their burden of proving that to resolve such a misrepresentation claim

(assuming one is made), the Court would have to interpret disputed terms of the collective

bargaining agreement.

The Court does not interpret the allegation that plaintiff does not recall receiving any

written disciplinary action as a separate claim challenging the imposition of such action. 

Such allegation does not have any direct bearing on plaintiff’s claim that defendant

misrepresented the terms of its loan repayment agreement, the claim in which the allegation

appears.

As this action no longer states a federal question, it is REMANDED to state court.

IT IS SO ORDERED.

Dated: March 20, 2008 

CHARLES R. BREYER

UNITED STATES DISTRICT JUDGE

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