Opinion ID: 621843
Heading Depth: 2
Heading Rank: 2

Heading: Judicial Review of a System Board Determination

Text: Next, Retirees argue that even if they are employees as contemplated by the RLA, they complied with the dispute resolution process governed by the CBA and are thus able to seek judicial review of the Retirement Board's October 2009 determination. The RLA notably distinguishes between two types of disputes. A major dispute concerns the formation of a CBA, which arises when a CBA is not in place or when a party seeks to change the terms of a CBA. A minor dispute concerns grievances or the interpretation or application of agreements covering rates of pay, rules, or working conditions. Mitchell v. Cont'l Airlines, Inc., 481 F.3d 225, 230-31 (5th Cir.2007) (citing Consol. Rail Corp. v. Ry. Labor Execs.' Ass'n, 491 U.S. 299, 302-03, 109 S.Ct. 2477, 105 L.Ed.2d 250 (1989)); see also 45 U.S.C. § 184 (requiring air carriers and unions to establish arbitral boards for the resolution of disputes between an employee or group of employees and a carrier or carriers by air growing out of grievances, or out of the interpretation or application of agreements concerning rates of pay, rules, or working conditions. . .). At the crux of the issue here, the RLA requires minor disputes that cannot be settled through internal grievance procedures to be resolved through a mandatory, exclusive, and comprehensive resolution process before a claims adjustment board established by the employees' union and the employer through the CBA. See, e.g., Hawaiian Airlines, Inc. v. Norris, 512 U.S. 246, 248, 114 S.Ct. 2239, 129 L.Ed.2d 203 (1994); Bhd. of Locomotive Eng'rs v. Louisville & Nashville R.R. Co., 373 U.S. 33, 38, 83 S.Ct. 1059, 10 L.Ed.2d 172 (1963). The distinguishing feature of [a minor dispute] is that the dispute may be conclusively resolved by interpreting the existing agreement. Consol. Rail Corp., 491 U.S. at 305, 109 S.Ct. 2477. Thus, [w]here an employer asserts a contractual right to take the contested action, the ensuing dispute is minor if the action is arguably justified by the terms of the parties' collective-bargaining agreement. Id. at 307, 109 S.Ct. 2477. Congress considered it essential to keep these so-called `minor' disputes within the Adjustment Board and out of the courts. Union Pacific R.R. Co. v. Sheehan, 439 U.S. 89, 94, 99 S.Ct. 399, 58 L.Ed.2d 354 (1978) (per curiam); see generally Hawaiian Airlines, 512 U.S. at 252, 114 S.Ct. 2239 (Congress' purpose in passing the RLA was to promote stability in labor-management relations by providing a comprehensive framework for resolving labor disputes. (citation omitted)). Furthermore, national policy favors the final settlement of labor disputes outside of the judicial process, see, e.g., Air Line Pilots Ass'n, Int'l v. E. Air Lines, Inc., 632 F.2d 1321, 1323 (5th Cir.1980), and [t]he federal policy of settling labor disputes by arbitration would be undermined if courts had the final say on the merits of the awards, Atchison, Topeka & Santa Fe Ry. Co. v. United Transp. Union, 175 F.3d 355, 357 (5th Cir.1999) (quoting United Steelworkers of Am. v. Enter. Wheel & Car. Corp., 363 U.S. 593, 596, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960)). [3] That being said, [t]he assertion of any right that is not created by a CBA is . . . not subject to binding arbitration under the statute. CareFlite v. Office & Prof'l Emps. Int'l Union, AFL-CIO, 612 F.3d 314, 320-21 (5th Cir.2010) (Dennis, J., concurring). [4] Retirees would be hard-pressed to dispute that resolution of the pension determination here can only be done through interpretation of the CBA, which would normally constitute a minor dispute and thus be subject to the RLA's mandatory dispute resolution process. See Long v. Flying Tiger Line, Inc., 994 F.2d 692, 694 (9th Cir.1993) (An employee pension plan falls within the scope of the [RLA] and is subject to its mandatory arbitration procedures.) (citing Air Line Pilots Ass'n, Int'l v. Nw. Airlines, Inc., 627 F.2d 272, 275 (D.C.Cir.1980)). To be sure, Retirees' claim is dependent entirely on the proper calculation of pension benefits, which can only be done through reference to the CBA-incorporated Plan. Retirees rely on two cases within our circuit to stress the argument that parties to a CBA may exempt certain disputes from the RLA's compulsory arbitration procedures. First, Retirees cite Bonin v. American Airlines, for the proposition that parties may contract to allow an RLA-governed claim to go to court under ERISA. 621 F.2d 635 (5th Cir.1980). In Bonin, the plaintiff pilot brought suit under ERISA § 502, alleging various claims relating to his wrongful discharge and improper allocation of pension benefits owed him under his pension plan. Id. at 637. After clearly acknowledging the exclusive province of RLA systems boards over minor disputes, we looked to the language of the Retirement Plan in finding that the pension claims were not subject to interpretation under the CBA. Id. at 638-39. We looked to the Retirement Plan itself, which included language governing Board jurisdiction: `neither the interpretation of the Plan nor its administration shall as such be within the jurisdiction' of the collective bargaining agreement. Id. at 639. We thus held that [s]ince the pension plan. . . is not maintained pursuant to a collective bargaining agreement, the district court has jurisdiction of plaintiff's pension claim under ERISA. Id. In coming to this conclusion, we made an important distinction governing claims under ERISA and the RLA: Congress by enactment of ERISA endorsed in effect two alternative methods of administering pension plan claims for employers whose collective bargaining disputes are governed by the Railway Labor Act: (1) arbitration of employee pension claims or (2) independent administration of claims by the pension plan administrator with a federal right of review pursuant to ERISA. Id. [5] In effect, the parties may choose whether they want to be governed exclusively by the RLA or maintain a judicial cause of action pursuant to ERISA. More recently, a quorum of this court decided CareFlite v. Office and Professional Employees International Union, which involved a CBA that included terms similar to the dispositive language in Bonin. 612 F.3d at 316. Judge Dennis focused on two clauses in the CBA that made claims stemming from the termination of employment for failure to obtain certain licenses and training non-grievable and non-arbitrable. Id. He concluded that minor disputes `must be resolved only through the RLA mechanisms, including the carrier's internal dispute-resolution processes and an adjustment board established by the employer and the unions.' Id. at 318 (quoting Hawaiian Airlines, 512 U.S. at 253, 114 S.Ct. 2239). However, he determined that the assertion of any right that is not created by a CBA is . . . not subject to binding arbitration under the statute. Id. at 320-21 (citing Hawaiian Airlines, 512 U.S. at 258, 114 S.Ct. 2239). Judge Elrod agreed that the particular dispute was not arbitrable, but she employed a different rationale. Id. at 325 (Elrod, J., concurring). She determined that the dispute was minor but that the RLA allows parties to exclude some minor disputes from arbitration. Id. The issue presented here is slightly different: whether parties to a CBA can choose to include disputes within the RLA's dispute resolution process, yet evade the exclusivity of RLA arbitration by expressly providing for judicial review of System Board decisions. We conclude that they cannot. Retirees contend that their pension plan, and its concomitant integration into the CBA, provides for ERISA relief after an adverse decision by the Retirement Board. Indeed, the CBA's terms provide as much, clearly contemplating the ability of a claimant to sue under ERISA § 502. Insofar as parties to a contract cannot avoid the exclusivity of the RLA's arbitral process, neither does ERISA supersede [6] the mandatory arbitration provisions of the RLA, as evidenced by ERISA's express provision ceding authority to previously enacted laws. 29 U.S.C. § 1144(d) (Nothing in this title shall be construed to alter, amend, modify, invalidate, impair, or supersede any law of the United States . . . or any rule or regulation issued under any such law.). Retirees' grievances are thus governed not by ERISA, but entirely by the [CBA] and subject to the jurisdiction of the System Board of Adjustment by the [RLA]. Bonin, 621 F.2d at 638. Bonin does make clear that parties have a choice between two alternate avenues for resolving ERISA claims that fall under the RLA: providing for RLA dispute resolution or excluding certain disputes from the RLA's mandates and affording judicial review under ERISA following independent administration of claims by a plan administrator. Retirees here erroneously seek bothRetirement Board review under the RLA followed by judicial review under ERISA. The pension claims here are undisputedly grounded in the CBA and require interpretation of the agreement as evidenced by Retirees' utilization of the Retirement Board for review of Continental's interpretation of the Plan. Retirees reference language in Bonin and CareFlite that they contend allow parties to freely contract out of the RLA, but further examination of these decisions elucidates their limited application. The CBA provision at issue in Bonin completely removed the pension plans and the CBA from the RLA resolution process, making the grievances there subject to federal subject matter jurisdiction because they could not be characterized as minor disputes under the RLA. [7] CareFlite did not command a majority for its rationale but, in any event, did not involve a party who sought both RLA-style review and judicial review. The pension plans here are subject to the RLA, and Retirees have indeed sought review before the Retirement Board. Moreover, nothing in the CBA explicitly cedes arbitral jurisdiction over adverse benefit determinations from the Board. Rather than finding themselves outside the ambit of the RLA, Retirees contend that the CBA provides for federal judicial review of the Retirement Board determination. [8] This contention is untenable. [P]arties . . . may neither confer subject matter jurisdiction on the district court nor strip it of such jurisdiction by agreement or waiver. Buchner v. FDIC, 981 F.2d 816, 818 (5th Cir.1993) (citation omitted); see Bowe, 974 F.2d at 103-04 (`Parties to an agreement cannot create federal subject matter jurisdiction by consent.') (quoting Jader v. Principal Mut. Life Ins. Co., 925 F.2d 1075, 1077 (8th Cir.1991)); see also Hall Street Assocs., L.L.C. v. Mattel, Inc., 552 U.S. 576, 578, 128 S.Ct. 1396, 170 L.Ed.2d 254 (2008) (holding that the narrow grounds for judicial review of an arbitration award under the Federal Arbitration Act could not be altered by party agreement); cf. Air Line Pilots Ass'n, Int'l v. U.S. Airways Grp., Inc. 609 F.3d 338, 343 (4th Cir.2010) (citing 45 U.S.C. § 184) [9] ; Delta, 863 F.2d at 92-95 (rejecting union's argument that RLA arbitration requirements cannot be waived or bargained away because the purpose of an arbitration board under the RLA is to decide disputes arising out of the CBA, and if a CBA specifically excludes an issue from arbitration or grievance, then a claim based on that issue cannot be said to arise from it). Retirees contend that they are not seeking to create federal subject matter jurisdiction, but instead are relying on ERISA as an alternative method of administering pension plan claims. In support of this argument, Retirees rely on McDonald v. Continental, 4:10-CV-00408 (S.D. Tex. July 8, 2011), addressing this same Plan, which suggested in dicta that the provisions were analogous to those in Bonin and CareFlite and thus subject to judicial review under ERISA § 502(a). McDonald, however, determined that the court lacked jurisdiction over McDonald's particular (and different) claim. Thus, it does not aid our analysis here. If Retirees were able to bring suit under ERISA for minor disputes it would destroy the purposes of the RLA in promoting an efficient and comprehensive framework for resolving labor disputes. Hawaiian Airlines, 512 U.S. at 252, 114 S.Ct. 2239. The RLA's dispute resolution process, if it applies, is mandatory and exclusive and clearly does not contemplate providing an additional outlet for review. That is just what Retirees are seeking hereRetirees' interpretation of the RLA would provide claimants with an additional forum for their disputes following adverse determinations. Perhaps even more concerning would be the potential for employers to seek costly judicial review in contravention of a System Board determination favorable to a claimant. Lastly, it is well established that judicial review of System Board determinations is exceptionally narrow. See, e.g., Sheehan, 439 U.S. at 91, 99 S.Ct. 399. In this way, it is similar to the limited judicial review of arbitration awards under the Federal Arbitration Act. The Supreme Court in Hall Street Associates expressly disallowed the parties' agreed upon judicial review that exceeded the judicial review contemplated by the FAA. 552 U.S. at 585-90, 128 S.Ct. 1396. Here, the Retirees are explicitly looking for a contracted-for judicial remedy following an adverse RLA-established Retirement Board ruling without showing any of the narrow exceptions to RLA exclusivity. We decline to depart from established precedent preventing parties from creating federal court jurisdiction where there is none.