Opinion ID: 464999
Heading Depth: 3
Heading Rank: 1

Heading: Preemption Issue

Text: 14 Bloom first argues that his wrongful discharge action cannot be preempted by the LMRDA because it is specifically saved from preemption by the Act itself. He cites 29 U.S.C. Secs. 413, 523, and 524, which he asserts save his state claim. 6 Sections 413 and 523(a), however, save causes of action enjoyed by union members, and, as discussed above, Bloom is not bringing this action as a union member but as a union employee. Just as he is not entitled to the substantive protections of the LMRDA as an employee, so he cannot enjoy its savings clauses. The remaining section, 29 U.S.C. Sec. 524, saves only state criminal laws and thus cannot directly save appellant's civil action. 7 15 Even if his state claim is not specifically saved from preemption, Bloom argues that the district court erred in finding preemption on the facts alleged in his complaint. No federal statute directly covered the terms and conditions of Bloom's employment and, he correctly notes, he was an at-will employee under California law. 16 Federal labor law preemption of state law is a complex and difficult area of the law. Because the statutes are largely silent as to what aspects of state law Congress intended to preempt, we have developed a preemption doctrine based on legislative history and judicial conceptions of what federal labor policy requires. Olguin v. Inspiration Consolidated Copper Co., 740 F.2d 1468, 1473 (9th Cir.1984). Preemption questions clearly require us to balance state and federal interests, although the relative importance attached to each interest is unclear. 8 Id.; Garibaldi v. Lucky Food Stores, Inc., 726 F.2d 1367, 1372-73 (9th Cir.1984), cert. denied, --- U.S. ----, 105 S.Ct. 2319, 85 L.Ed.2d 839 (1985).
17 In the present case, the state's interest is strong. Bloom asserts in his complaint that he was fired for refusing to alter the minutes of a union meeting to cover up an unapproved expenditure (in effect an embezzlement) of union funds by other union officers. California law prohibits embezzlement. See, e.g., Cal. Penal Code Secs. 503, 504, 506 & 508 (West 1970); see also People v. Swanson, 174 Cal.App.2d 453, 344 P.2d 832 (1959) (embezzlement of union funds). California has a strong interest in preventing this crime, and consequently in seeing that employees are not coerced by threat of discharge into committing or abetting the crime. A state cause of action for wrongful discharge based on refusal to submit to such coercion is a necessary deterrent to both the coercion and the crime itself. See Petermann v. International Brotherhood of Teamsters, 174 Cal.App.2d 184, 188-89, 344 P.2d 25, 27 (1959). 9 If federal labor law preempts such a cause of action, the deterrent effect is lost and nothing prevents unscrupulous employers from forcing employees to choose between committing crimes and losing their jobs. 10 18 Moreover, the Act itself explicitly saves both state criminal actions 11 and state-imposed responsibilities of union officers 12 from preemption by the Act. The continued vitality of the California statutes in light of these saving clauses logically implies the continued vitality of the state's means of enforcing those statutes, including, as here, a cause of action for wrongful discharge for refusal to acquiesce or abet in the statutes' violation. Thus, although the savings clauses addressing union members do not directly save Bloom's state cause of action, as discussed above, the clauses addressing criminal actions and union officers' duties imply that Bloom can maintain his action. Having established a strong state interest and implicit approval of Bloom's cause of action in the Act, we must determine if any interest of federal labor policy precludes Bloom's cause of action.
19 The LMRDA addresses various aspects of the abuse of power by union leaders. Title I of the Act, 29 U.S.C. Secs. 411-15 (1982), provides, among other things, equal rights, freedom of speech and assembly, and safeguards against improper disciplinary action for union members. See 29 U.S.C. Sec. 411 (1982). These rights clearly aim at promoting union democracy and at making democratically elected union leaders responsive to the wishes of their memberships. Finnegan v. Leu, 456 U.S. 431, 441-42, 102 S.Ct. 1867, 1873-74, 72 L.Ed.2d 239 (1982); see Cehaich v. International Union, U.A.W., 710 F.2d 234, 239 n. 9 (6th Cir.1983); see also 29 U.S.C. Sec. 401 (1982) (congressional statement of purpose and policy). This responsiveness requires a degree of power and autonomy, and the ability of an elected union president to select his own administrators is an integral part of ensuring a union administration's responsiveness to the mandate of the union election. Finnegan, 456 U.S. at 441, 102 S.Ct. at 1873. The federal interest in promoting union democracy and the rights of union members, therefore, includes an interest in allowing union leaders to discharge incumbent administrators. 13 20 We need not decide, however, whether allowing a state cause of action for wrongful discharge would generally undermine this federal interest and rob the union leader of discretion needed to serve the wishes of the membership and thus the purposes of the Act. See Tyra v. Kearney, 153 Cal.App.3d 921, 926-27, 200 Cal.Rptr. 716, 719-20 (1984) (holding that a state claim for wrongful discharge was preempted by the LMRDA and the Supreme Court's decision in Finnegan). 14 In the present case, Bloom alleges that he was fired, not for political reasons, or for no reason at all, but rather because he refused to illegally alter the minutes of a union meeting. Not only is the state's interest in allowing the wrongful discharge action here strong, as discussed above, but the federal interest is much lessened under these circumstances. The kind of discharge alleged, retaliation for refusal to commit a crime and breach a trust, is not the kind sanctioned by the Act, or by the courts in Finnegan and Tyra. Protecting such a discharge by preempting a state cause of action based on it does nothing to serve union democracy or the rights of union members; it serves only to encourage and conceal such criminal acts and coercion by union leaders. 21 In Tyra and Finnegan, the discharge of the employee was central to the concerns of federal labor policy, and a state cause of action would have interfered with the federal regulatory scheme. See San Diego Building Trades Council v. Garmon, 359 U.S. 236, 244, 79 S.Ct. 773, 779, 3 L.Ed.2d 775 (1959); Farmer v. United Brotherhood of Carpenters and Joiners of America, Local 25, 430 U.S. 290, 305, 97 S.Ct. 1056, 1066, 51 L.Ed.2d 338 (1977). The subject of the suit here is merely peripheral to the concerns of the Act, see, e.g., Linn v. United Plant Guard Workers of America, Local 114, 383 U.S. 53, 59-63, 86 S.Ct. 657, 661-663, 15 L.Ed.2d 582 (1966) (charge of libel not central to NLRA concerns), and a state cause of action would not interfere with federal policy at all. 15 22 Furthermore, the state cause of action actually advances the purpose of the Act. Title V of the Act prohibits the very acts of embezzlement and imposes the very fiduciary duties addressed by state law and alleged here by Bloom. 29 U.S.C. Sec. 501 (1982). The Act, however, lacks any mechanism for preventing the coercive firings that might aid violation of those provisions. The state cause of action for wrongful discharge for refusing to violate the provisions is therefore a useful adjunct to federal as well as state law. 23 In conclusion, we find that the district court applied Tyra overbroadly and erred in finding Bloom's wrongful discharge action was preempted. Where, as here, a union employee bases a wrongful discharge action on allegations that he was fired for refusing to violate state law, that cause of action is not preempted by the federal labor policies reflected in the LMRDA or Finnegan v. Leu.