Opinion ID: 670809
Heading Depth: 2
Heading Rank: 2

Heading: LMRA basis for action.

Text: 60 The Trust Funds' complaint also asserts LMRA Sec. 301 as a federal jurisdictional basis for their second claim. The district court relied on a Sixth Circuit case, Metropolitan Detroit Bricklayers Dist. Council v. J.E. Hoetger & Co., 672 F.2d 580 (6th Cir.1982), to hold that a prime contractor (such as Mark) may not be held liable under Sec. 301 for benefits under a collective bargaining agreement between a subcontractor (such as Stark) and a union (the carpenters). However, the Sixth Circuit in Hoetger expressly left open an issue similar to the question facing us: 61 If [the contractor] had obligated itself in its contract with [the subcontractor] to escrow amounts due as fringe benefits and had failed to do so ... [the union and its trust funds] would have had a claim against [the contractor] as third-party beneficiaries, though not necessarily under Sec. 301(a). 62 Id. at 585 n. 8 (emphasis added). Therefore, we may not rely on Hoetger. 63 Section 301(a) of the LMRA provides in relevant part that 64 [s]uits 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, without respect to the amount in controversy or without regard to the citizenship of the parties. 65 29 U.S.C. Sec. 185(a) (1989). The Trust Funds' first amended complaint alleges that the subcontract between Mark and Stark contains a provision stating that [l]abor benefits will be paid under a joint check agreement between [Mark, Stark] and the appropriate agency. [ER at 69 (emphasis added) ]. 11 The Trust Funds' complaint then alleges that 66 [i]t was understood by MARK, STARK and by the Plaintiffs that payment of required fringe benefit contributions to Plaintiffs were to be made via joint check, naming as Payees both the Carpenters Trust Funds and Stark Construction. 67 24. MARK knew weekly the number of carpentry hours for which benefit contributions were due because STARK submitted weekly certified payroll records to MARK. On October 12, 1989, Plaintiffs, who are third-party beneficiaries to the subcontract, notified MARK of the benefit contributions due and requested payment. To date, Defendant MARK has failed and refused to pay to Plaintiffs any amounts in fringe benefit contributions or issue the joint checks pursuant to [the subcontract]. 68 25. An actual controversy has arisen and now exists between Plaintiffs and defendant MARK and Plaintiffs desire a judicial determination and declaration of Plaintiffs' rights under the subcontract and an injunction requiring defendant MARK to issue a joint check to Plaintiffs and Stark and to deliver it to Plaintiffs and enjoining MARK from its failure and refusal to make the payments as required by the Subcontract. 69 [ER at 34-35 (emphasis added) ]. We have held that 70 [a]ll that is required for jurisdiction to be proper under Sec. 301(a) is that the suit be based on an alleged breach of contract between an employer and a labor organization and that the resolution of the lawsuit be focused upon and governed by the terms of the contract. 71 Painting & Decorating Contractors Ass'n v. Painters & Decorators Joint Comm., Inc., 707 F.2d 1067, 1071 (9th Cir.1983), cert. denied, 466 U.S. 927, 104 S.Ct. 1709, 80 L.Ed.2d 182 (1984) (emphasis added). The contract at issue need not be a collective bargaining agreement, but only an agreement between [an] employer[ ] and [a] labor organization[ ] significant to the maintenance of labor peace between them. Retail Clerks Int'l Ass'n v. Lion Dry Goods, Inc., 369 U.S. 17, 28, 82 S.Ct. 541, 548, 7 L.Ed.2d 503 (1962). See Hotel Employees v. Marriott Corp., 961 F.2d 1464, 1466 n. 3 (9th Cir.1992) (letter agreement between Marriott and union, designed to end union opposition to Marriott's involvement in the construction of a large hotel and to guide employment of the hotel staff, is such an agreement); General Teamsters v. Mitchell Bros. Truck Lines, 682 F.2d 763, 765-66 (9th Cir.1982) (strike settlement agreement between union and trucking company is such an agreement). 12 72 No facts have been alleged to establish that the alleged understanding constitutes a valid and enforceable contract. 13 In any event, we need not decide whether such an understanding could form the basis for Sec. 301 jurisdiction as an agreement between a labor organization and an employer, even though it is not a collective bargaining agreement. The Trust Funds do not allege that Mark breached this understanding or any other agreement between Mark and the Trust Funds contemplated by the subcontract. Rather, the Trust Funds alleges that Mark breached the subcontract itself. Because the subcontract is not a contract between an employer and a labor organization, the complaint does not allege facts sufficient to provide Sec. 301 jurisdiction.