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UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW JERSEY

AMERICAN WATER WORKS COMPANY, 

INC.,

Plaintiff,

 v.

UTILITY WORKERS LOCAL 423, et al.,

 Defendants.

11-CV-1462-WJM

 

OPINION

This matter comes before the Court on two related motions to dismiss filed 

by two of the union defendants (the “Moving Defendants”). Both Moving 

Defendants argue that the Complaint fails to state a claim and that venue is 

improper. One Moving Defendant also argues that this Court lacks subject matter 

jurisdiction. For the reasons stated below, the Court finds that venue is improper as 

to the Moving Defendants. The Court will sever those defendants and transfer their 

cases and will otherwise deny the motions. 

I. Background

Plaintiff American Water Works Company (“AWW”) is the parent company 

of various local subsidiaries called operating companies that operate local water 

and wastewater utilities through the United States. The six defendants are various 

unincorporated local unions that represent employees of the operating companies. 

Of the six defendants, only one, Utility Workers Local 423, is based in New 

Jersey; Local 423 did not file or join any motion to dismiss. The two defendants 

that have filed the present motions, Local 1353 of the Laborers International Union 

of North America and Utility Workers Local 537, are based in West Virginia and 

Pennsylvania, respectively. 

The union defendants negotiate with the operating companies to develop 

local collective bargaining agreements covering some terms of employment for 

their members. But the defendants ceded authority to negotiate certain other terms 

of employment, specifically relating to medical, retirement, and other benefits, to a 

committed of representatives that bargains directly with AWW at a national level. 

In 2010, the national-level negotiations failed to reach a deal, and AWW 

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implemented its last, best, final offer regarding these other terms of employment. 

The defendants have since filed separate grievances with their local operating 

companies regarding implementation of these terms, and some or all have 

allegedly threatened to seek or have demanded arbitration. AWW filed its 

complaint seeking a declaration that the terms are not grievable, that the grievances 

are not arbitrable, and that in any event the defendants are preempted from 

grieving the issue by the Labor Management Relations Act (“LMRA”).

II. Legal Analysis

A. Defendants’ Arguments Regarding Subject Matter Jurisdiction 

and Failure to State a Claim Fail

Local 537 argues that the Court lacks subject matter jurisdiction under 

Section 301(c) of the LRMA, 29 U.S.C. § 185. But, as discussed below, Section 

301(c) actually refers to venue, and so Local 537’s argument fails. See, e.g., United 

Rubber, Cork, Linoleum and Plastic Workers of America, AFL-CIO, Local 102 v. 

Lee Rubber & Tire Corp., 394 F.2d 362, 363 (3d Cir. 1968) (rejecting argument 

that court lacks subject matter jurisdiction under Section 301(c)); Gilreath v. 

Plumbers, Pipefitters & Service Technicians Local 502, 2010 WL 6429570, at *3 

& n.3 (S.D. Ohio Sept. 2, 2010); National Elevator Bargaining Ass’n v. 

International Union of Elevator Constructors, 2008 WL 4566684, at *2 n.1 (D. 

Md. Oct. 10, 2008); Franchino v. Valenti, 347 F. Supp. 1020, 1022 (E.D.N.Y. 

1972). This Court has subject matter jurisdiction over this action because AWW 

asks the Court to determine the arbitrability of the defendants’ grievances. Lukens 

Steel Co. v. United Steelworkers of America (AFL-CIO), 989 F.2d 668, 671 (3d 

Cir. 1993).

The Moving Defendants also argue that AWW has failed to state a claim 

upon which relief can be granted because AWW has not alleged that it is a party to 

the local collective bargaining agreements under which the defendants grieved. But 

the Moving Defendants fail to cite any legal basis for this argument, and it is 

unclear if the Moving Defendants are actually raising the issue of standing. 

Contrary to their general argument, there are instances where an individual that is 

not a signatory or party to an agreement may have standing to bring a claim about 

that agreement and/or may be able to state a claim for relief that relates to that 

agreement. See, e.g., Cargill Global Trading v. Applied Development Co., 706 F. 

Supp. 2d 563, 579 (D.N.J. 2010) (recognizing that under New Jersey law third 

party beneficiary of contract has standing to sue ). In light of this – and the fact that 

they have not really developed their argument by pointing to any case law to the 

contrary – the Court will deny the motion to dismiss on this point at this time.

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B. Venue is Improper as to the Moving Defendants

Both moving defendants argue that the venue is improper in this district 

under Section 301(c) of the LRMA:

For the purposes of actions and proceedings by or against labor 

organizations in the district courts of the United States, district 

courts shall be deemed to have jurisdiction of a labor organization 

(1) in the district in which such organization maintains its principal 

office, or (2) in any district in which its duly authorized officers or 

agents are engaged in representing or acting for employee members.

29 U.S.C. § 185(c). Despite the fact that the legislation explicitly uses the 

word “jurisdiction”, numerous courts, including the Third Circuit Court of 

Appeals, have held that the statute actually governs the issue of venue, as cited 

above. According to the allegations of the Complaint, neither Moving Defendant 

maintains its principal place of business in New Jersey, nor does either Moving 

Defendant engage in representing or acting for its members in New Jersey. Nor has 

AWW alleged anything to suggest that the Moving Defendants have even minimal 

contacts with this District. See Reed v. International Union of United Auto., 

Aerospace & Agr. Implement Workers of America, 945 F.2d 198, 201 n.3 (7th Cir. 

1991) (holding that courts may use minimum contacts analysis to determine if 

Section 301(c) has been satisfied). Thus, under Section 301(c), venue is improper 

in New Jersey for both Moving Defendants 

AWW does not contest the Moving Defendants’ characterization of Section 

301(c); instead, AWW argues that venue is proper under 28 U.S.C. § 1391(b), the 

general venue statute. AWW is incorrect. As a matter of basic statutory 

construction, a general statute does not apply where there is a more specific rule. 

See Green v Bock Laundry Mach. Co., 490 U.S. 504, 524-25 (1989). Thus, where 

Congress has created a venue statute specific to certain kinds of actions, that 

statute trumps the general venue statute. See Radzanower v. Touche Ross & Co., 

426 U.S. 148, 158 (1976) (“It follows under the general principles of statutory 

construction discussed above that the narrowly drawn, specific venue provision of 

the National Bank Act must prevail over the broader, more generally applicable 

venue provision of the Securities Exchange Act.”); Servewell Plumbing, LLC v. 

Federal Ins. Co., 439 F.3d 786, 791 (8th Cir. 2006) (“Ark.Code Ann. § 16-60-115, 

which specifically addresses proper venue for an action against a surety on a 

contractor’s payment or performance bond, trumps the general venue provision of 

the Arkansas Insurance Code fixing venue for any action against any type of 

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insurer.”); Harding v. Williams Property Co., 163 F.3d 598, at *2 & n.5 (4th Cir. 

1998) (table) (holding specific venue provision of Title VII of the Civil Rights Act, 

42 U.S.C. § 2000e, et seq., trumps general venue provision Section 1391); Johnson 

v. Payless Drug Stores Northwest, Inc., 950 F.2d 586, 587-88 (9th Cir. 1991) 

(same); Bolar v. Frank, 938 F.2d 377, 379 (2d Cir. 1991) (same); Stebbins v. State 

Farm Mut. Auto. Ins. Co., 413 F.2d 1100, 1102-03 (D.C. Cir. 1969) (same). And in 

such cases, the general venue statute does not provide an alternative basis for 

venue. While case law analyzing the applicability of Section 301(c) with relation to 

28 U.S.C. § 1391 is scant, the logical conclusion to reach based on the forgoing is 

that Section 301(c), being the specific statute, trumps, and Section 1391(b) has no 

application.

C. The Court Will Sever and Transfer the Two Moving Defendants

Once the Court has determined that venue is improper as to certain 

defendants, the Court must take one of three steps: dismiss the case against those 

defendants, transfer the entire case to a venue that would be proper as to all 

defendants, or sever the defendants for which venue is improper and transfer those 

cases. See 28 U.S.C. § 1406(a); Cottman Transmission Systems, Inc. v. Martino, 36 

F.3d 291, 296 (3d Cir. 1994).

Severance is the best option. The Moving Defendants have failed to raise 

any alternate argument that suggests that dismissal is appropriate here, and the 

Court fails to see how justice would be served by forcing AWW to refile. 

Transferring the entire case is also out of the question: under this Court’s 

interpretation of Section 301(c), there is no proper venue. Each defendant is a local 

union that would ostensibly be amenable to suit under Section 301(c) in different 

districts based on the allegations of the Complaint. 

While the Third Circuit has cautioned against severance where the party to 

be severed is indispensible, see, e.g., Sunbelt Corp. v. Noble, Denton & Assocs., 

Inc., 5 F.3d 28, 33-34 (3d Cir. 1993), none of the parties here are indispensible. 

Each defendant union operates under its own local collective bargaining 

agreement, and although AWW has categorized them together, each is an 

independent entity raising an independent grievance. Although it would obviously 

be more convenient for AWW to be able to bring its declaratory judgment against 

all six unions in one venue, the law does not appear to provide it that convenience. 

While it is regrettable that this may create some inefficiencies and irregularities, 

this may be unavoidable given the nature of the action and the parties involved. 

Congress crafted a specific regime for venue applicable to suits by and against 

labor organizations that this Court must follow it.

According to the allegations of the Complaint, the Southern District of West 

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Virginia would be the appropriate venue for the action against Local 1353, which 

is based in Charleston, West Virginia. The appropriate venue for the action against 

Local 537, based in Washington, Pennsylvania, would be the Western District of 

Pennsylvania.

III. Conclusion

For the foregoing reasons, the Court will sever defendants Local 1353 and 

Local 537 from the action and transfer their cases to the appropriate districts and 

otherwise deny the motions to dismiss. An appropriate order follows.

 /s/ William J. Martini 

WILLIAM J. MARTINI, U.S.D.J.

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