Opinion ID: 1262494
Heading Depth: 2
Heading Rank: 1

Heading: The IAM Plan

Text: Congress expanded the RLA to the airline industry to promote stability in labor-management relations between carriers by air and their employees. 45 U.S.C. §§ 151a, 181, 184; Hawaiian Airlines, Inc. v. Norris, 512 U.S. 246, 252, 114 S.Ct. 2239, 129 L.Ed.2d 203 (1994). To accomplish this goal, the RLA requires parties to arbitrate all minor disputes before an adjustment board, which Congress authorized to settle labor-management disputes regarding collective bargaining agreements in the airline industry. Hawaiian Airlines, 512 U.S. at 252, 114 S.Ct. 2239; see 45 U.S.C. § 185; Jenisio v. Ozark Airlines Inc. Ret. Plan for Agent & Clerical Employees, 187 F.3d 970, 972-73 (8th Cir. 1999). Minor disputes involve disputes . . . growing out of . . . the interpretation or application of [collective bargaining] agreements concerning rates of pay, rules, or working conditions. Jenisio, 187 F.3d at 972-73 (quoting 45 U.S.C. § 184). [T]here is a presumption that disputes are minor and thus arbitrable. Id. at 973. The [adjustment] [b]oard has mandatory, exclusive, and comprehensive jurisdiction over minor disputes. . . . Id. (citing. Bhd. of Locomotive Eng'rs v. Louisville & Nashville R.R., 373 U.S. 33, 39, 83 S.Ct. 1059, 10 L.Ed.2d 172 (1963)). Hastings and Karpiuk assert that Congress did not intend the RLA's mandatory arbitration scheme to apply to ERISA claims. However, this court has held that the RLA's arbitration requirement applies to ERISA claims if the pension plan is (1) itself a collective bargaining agreement or (2) maintained pursuant to a collective bargaining agreement. Id. Hastings and Karpiuk do not dispute that the IAM Equity Agreement, the JAM Trust Agreement and the merger agreement constitute collective bargaining agreements and that the IAM Plan was maintained pursuant to them. Therefore, the RLA's arbitration requirement can apply to these ERISA claims. Hastings and Karpiuk next argue that their ERISA breach of fiduciary duty claims are not minor disputes because they do not concern rates of pay, rules, or working conditions. See id. at 972-73 (holding that disputes . . . growing out of. . . . the interpretation or application of agreements concerning rates of pay, rules, or working conditions constitute minor disputes within the exclusive jurisdiction of the RLA's arbitration board). Here, the JAM Equity Agreement and the IAM Trust Agreement concerned the rate of pay between NWA and IAM members because NWA preferred stock was provided to IAM members as consideration for wage concessions. Therefore, any interpretation or application of the JAM Equity Agreement or the IAM Trust Agreement constitutes a minor dispute within the exclusive jurisdiction of the RLA adjustment board. Hastings and Karpiuk contend that the determination of a breach of fiduciary duty in this case is independent of an interpretation or application of the collective bargaining agreements. The district court, rather than the RLA arbitration board, has jurisdiction over ERISA claims that are independent of an interpretation or application of any collective bargaining agreements, even if the pension plan is created or maintained pursuant to a collective bargaining agreement. See Air Line Pilots Ass'n, Ina v. Northwest Airlines, Inc., 627 F.2d 272, 277 (D.C.Cir.1980). In Air Line Pilots, NWA collected interest accumulated as a result of its unreasonable delay in payments due under a pension plan. Id. at 274. In rejecting NWA's efforts to compel RLA arbitration, the court held that ALPA's breach of fiduciary duty claim was independent of the collective bargaining agreement because even if NWA's conduct in keeping the interest was permissible under a proper interpretation of the plan, NWA's failure to act solely for the benefit of the plan participants could still constitute a breach of fiduciary duties under ERISA. Id. at 277. However, in Everett v. USAir Group, Inc., 927 F.Supp. 478 (D.D.C.1996), aff'd, 194 F.3d 173 (D.C.Cir.1999), the district court determined that it lacked subject matter jurisdiction due to the RLA because the breach of fiduciary duty claim was not independent of a collective bargaining agreement. Id. at 483. There, the collective bargaining agreement included the method for calculating pension benefits. Id. at 480. To determine whether USAir wrongfully excluded dividends from its calculation of plan benefits required first the proper interpretation of the benefit calculation method described in the collective bargaining agreement. Id. at 483. Therefore, the court held that the breach of fiduciary duty claim was not independent of the collective bargaining agreement because determining if USAir improperly calculated plan benefits turn[ed] on whether USAir's interpretation of the plan [was] incorrect or misleading. Id. As in Everett, Hastings's and Karpiuk's breach of fiduciary duty claims are not independent of the collective bargaining agreements. The NWA Defendants deny that they are fiduciaries of the IAM Plan. The NWA Defendants are not trustees of the IAM Plan. However, because the IAM Equity Agreement and the IAM Trust Agreement require NWA's concurrence whenever the IAM appoints or removes trustees, Hastings and Karpiuk argue that NWA effectively has the power to appoint and remove trustees and, therefore, is a fiduciary of the IAM Plan. See Hickman v. Tosco Corp., 840 F.2d 564, 566 (8th Cir. 1988) (holding that the power to appoint trustees makes one a fiduciary under ERISA). By their own assertions, the determination of. NWA's power to appoint and remove a trustee requires an interpretation and application of the collective bargaining agreements. Thus, the determination of whether or licit the NWA Defendants owe fiduciary duties to IAM Plan participants is not independent of an interpretation or application of the collective bargaining agreements. Because the breach of fiduciary duty claims involving the IAM Plan require an interpretation and application of the collective bargaining agreements, they constitute minor disputes within the exclusive jurisdiction of the RLA adjustment board. See Jenisio, 187 F.3d at 973. Finally, Hastings and Karpiuk claim that the NWA Defendants are estopped from asserting that the RLA arbitration board has jurisdiction because NWA distributed pamphlets indicating that IAM Plan participants may file suit in federal court. However, parties to a [collective bargaining agreement] may not circumvent the RLA's arbitration requirement (and thereby vest subject matter jurisdiction in the district court) by contractual agreement. Jenisio, 187 F.3d at 974; accord Bowe v. Northwest Airlines, Inc., 974 F.2d 101, 103-104 (8th Cir.1992) (Parties to an agreement cannot create federal subject matter jurisdiction by consent.). Therefore, the district court correctly concluded that it lacked subject matter jurisdiction over the claims that the NWA Defendants breached fiduciary duties owed to IAM Plan participants.