Opinion ID: 2637325
Heading Depth: 3
Heading Rank: 4

Heading: Effect of Federal Preemption on Evidence of Anti-Union Bias

Text: After Khotol moved to dismiss Willard's original complaint, the superior court indicated that it was inclined to dismiss two of Willard's claims because they were preempted by the NLRA. [26] The first claim asserted that Khotol breached the implied covenant of good faith and fair dealing and alleged in part that Willard's termination by Khotol was a pretextual discharge for union organization. The second claim was for breach of contract; among other things, it asserted that Khotol breached its employment contract with Willard in retaliation for [his] efforts to secure union representation for his fellow co-workers. In stating its intent to dismiss these claims, the court proposed to enter the dismissals without prejudice to allow amendment of Willard's complaint. In reply, Willard's attorney stated: I think that's probably appropriate for relief as long as Mr. Willard has the opportunity to amend his complaint. After the court dismissed the claims as preempted, Willard amended his complaint to remove all references to his involvement in efforts at union organization. On appeal, Willard challenges the court's order dismissing his original claims. He argues that, because his union activities formed only a part of those claims, the claims were not barred by federal preemption. In Willard's view, [t]he fact that the complaint alleged his participation in union activities as one of several reasons for his discharge did not justify dismissal and the requirement that the complaint be amended to eliminate reference to [Khotol]'s bad faith actions. . . . Evidence of [Khotol]'s bad faith in terminating Willard for his union organizing activities is both proper and relevant to his claim for breach of the covenant of good faith and fair dealing, and therefore he should have been permitted to allege such facts in his complaint and be able to present such evidence at a jury trial. In response, Khotol contends as a preliminary matter that Willard's attorney waived the right to challenge the superior court's preemption ruling by expressly telling the superior court that its proposal to dismiss the original claims was probably appropriate. But the statement by Willard's counsel cannot fairly be construed as acquiescence to the court's ruling on preemption. After the superior court proposed to dismiss the two claims as preempted, it qualified this proposal by suggesting that the dismissal could be entered without prejudice. The ensuing response by Willard's counsel focused on the suggested remedy of allowing amendment: I think that's probably appropriate for relief as long as Mr. Willard has the opportunity to amend his complaint. When viewed in context, Willard's counsel simply agreed that if the court followed through with its proposal to dismiss the two claims, it would be appropriate to allow Willard the opportunity to amend his complaint. Indeed, the ensuing colloquy between Willard's counsel and the superior court confirms this interpretation by making it clear that Willard's counsel continued to disagree with the court's ruling of preemption. For instance, when the court later reiterated that it favored the approach of dismissal without prejudice, Willard's attorney replied, Again, I think this whole idea [of preemption under federal case law] is misconstrued because there are no federal issues involved here aside from the reference to union activities. [27] Because we conclude that Willard did not waive the point, we turn to the merits of his claim that the superior court misapplied the doctrine of federal preemption. [28] In San Diego Building Trades Council, Millmen's Union, Local 2020, Building Material and Dump Drivers, Local 36 v. Garmon, [29] the United States Supreme Court announced two general guidelines for courts to follow in assessing the permissible scope of state regulation of conduct touching on labor-management relations. First, the Court declared, state jurisdiction must yield when the activity in question is clearly protected or prohibited by the NLRA. [30] Second, the Court stated, both federal and state courts must defer to the exclusive competence of the National Labor Relations Board when an activity is arguably subject to § 7 [31] or § 8 [32] of the NLRA. [33] But the Court has also warned against applying these guidelines in a literal, mechanical fashion. [34] In Garmon the Court carved out specific exceptions to preemption for matters that are of only peripheral concern to the NLRA, or that are so deeply rooted in local law as to make it unreasonable to assume that Congress intended to preempt state law from applying. [35] The Court also has stressed the need to weigh the state's interest in adjudicating the type of claim asserted against the possibility of interference with the NLRB's regulatory jurisdiction. [36] Under this balancing test, when conduct is arguably prohibited by the NLRA, a critical inquiry is whether the controversy presented to the state court is identical with that which could be presented to the [NLRB]. [37] For example, in Sears, Roebuck & Co. v. Carpenters, the court held that a state trespass action was not preempted because the state action focused only on the location of the picketing, while a complaint to the NLRB would have focused on the substance and object of the picketing. [38] Willard contends on appeal that Garmon preemption did not apply to his original implied-covenant claim, because it included theories independent of the allegations of anti-union bias. In particular, he contends, because his original implied-covenant claim included allegations that his termination was based on personal animosity and that it violated public policy  factual allegations falling beyond the range of NLRB jurisdiction  the original claim was not factually identical to his potential federal claim, and so was not barred by Garmon preemption. Furthermore, regarding his amended complaint, Willard argues that because the implied-covenant claim now does not allege anti-union bias at all  resting completely on independent grounds  Garmon preemption does not bar him from introducing evidence tending to show anti-union bias, so long as it is relevant to support the independent state-law claims he actually seeks to prove. Willard supports this argument with a California Court of Appeal case, Kelecheva v. MultiVision Cable T.V. Corp. [39] In Kelecheva, a former supervisor alleged that he was subjected to harassment and discharged for refusing to spy on and write up co-workers involved in a unionization effort. [40] He sued his employer for wrongful termination, breach of an implied employment contract, and breach of the covenant of good faith and fair dealing. [41] The California Court of Appeal ultimately held that the plaintiff's state-law contract claims were not preempted, because the state litigation would focus on issues distinctly different from those that could have been raised before the NLRB. [42] In particular, the court noted that the contract did not require a showing of an unlawful motive and that the implied-covenant claim would likely focus on whether the defendant followed its own personnel rules or falsified the asserted grounds for discharge. [43] Under these circumstances, the court observed, the plaintiff would not be required to prove that the employer discharged him for reasons that violated federal labor law. [44] Noting the state's substantial interest in providing contract remedies for employees not covered by collective bargaining agreements, the court concluded that this interest outweighed any marginal effect that adjudication of the state-law claims would have on national labor policy. [45] Accordingly, Kelecheva held that the state claims were not barred, stating: Although evidence of defendant's anti-union animus may be relevant to plaintiff's claim of breach of the covenant of good faith and fair dealing, plaintiff would not be required to prove that defendant, in fact, discharged him for reasons that would violate federal or state labor law.[ [46] ] In response to Willard's reliance on Kelecheva, Khotol insists that the superior court correctly dismissed the claims in Willard's original complaint under Garmon and that Willard cannot escape preemption merely by characterizing his complaints as state contract claims. Khotol rests its argument on cases from other jurisdictions in which courts found state-law contract claims preempted under Garmon. But those cases  namely, Foreman v. AS Mid-America, Inc. [47] and Young v. Caterpillar, Inc. [48]  are distinguishable from Willard's. Both involved state-law claims that centered on the ways in which employees were treated or reinstated to their jobs following the resolution of labor strikes. And in both cases, the courts specifically found that the employers' strike-related conduct provided the sole basis for the state claims, and was identical to the conduct that could have been, or had been, presented to the NLRB. [49] In Foreman non-union replacement workers sued their former employer for breach of contract in connection with harassment and intimidation perpetrated by union workers returning to work after a strike. [50] The Nebraska Supreme Court found that the employer's failure to provide harassment-free work  as it had promised to do  was actually or arguably prohibited by the NLRA because the inaction amounted to condonation or protection of misconduct attributed to the union. [51] The court thus concluded that the company's failure to act was not merely a peripheral concern to federal labor law, but, rather, [was] so inextricably intertwined with federal labor law that to do other than preempt appellants' alleged breach-of-contract claims would obfuscate the NLRB's ability to adjudicate controversies under its purview. [52] Similarly, in Young, a group of employees sued their employer in state court for failing to reinstate them immediately after a strike concluded. [53] While the plaintiffs claimed that the employer had breached their individual employment contracts by delaying reinstatement, the court found that the plaintiffs' claims were in essence unfair labor practices claims under section 8 of the [NLRA]. [54] The court concluded that [d]espite attempts to dress the claims as breach of contract, the actual issues presented to the state court would be identical to those presented to the [NLRB] in an unfair labor practices claim. [55] The court thus concluded that the claims were preempted. By contrast, Willard's original complaint provided two potential bases for his breach-of-covenant claim that did not necessarily hinge on his allegations of anti-union bias  that his termination violated public policy and/or was based on personal animosity. As amended, his complaint does not allege anti-union bias. Thus, the issues to be considered by a state court are not identical to those originally presented to the NLRB. Foreman and Young are not persuasive authority for preemption here. Khotol also argues that Willard's reliance on Kelecheva is misplaced, particularly as to whether his anti-union bias is admissible in support of his implied-covenant of good faith and fair dealing claim. Khotol contends that if Kelecheva represents good law consistent with United States Supreme Court precedent, it cannot be interpreted as permitting evidence of anti-union bias to be admissible in support of a state claim, even if the evidence of bias is relevant to that claim. Further, Khotol insists that Kelecheva's reference to the potential relevance of anti-union animus is merely dicta that indicates the opposite point  that regardless of the `relevance' of the evidence of anti-union animus, such evidence `would not be required to prove' his claim. Although Kelecheva's meaning is somewhat unclear, we agree with Willard's reading of the case. The implied-covenant claim in Willard's first superior court complaint included an allegation that he had been fired in retaliation for his efforts to secure union representation. That allegation was essentially identical to the one he initially made to the NLRB. Standing alone, it raised a matter within the ambit of NLRB's jurisdictional sphere. But Willard's claim advanced two other implied-covenant theories that could stand independently. As originally raised, and as later elaborated on in Willard's amended complaint, these theories  that Willard's termination violated public policy and/or that it was prompted by his supervisors' personal animosity toward him  fall outside the ambit of federal concern, even though the conduct they allege might have been motivated by hostility resulting from Willard's union activity. [56] Accordingly, these theories were not preempted. Moreover, if these independent theories were tried in the superior court and evidence of anti-union animus became genuinely relevant to support them, we would see no reason why the admissibility of the evidence of bias should not be governed by the Alaska Rules of Evidence. The rules of evidence give trial courts broad discretion to exclude relevant evidence when its prejudicial impact or potential for confusion outweighs its probative value. [57] Here, if Willard offered to use evidence of Khotol's anti-union bias not just to impeach Khotol's claim that he was fired for insubordination, but also to suggest that Khotol breached the implied covenant by firing Willard for engaging in union-related activities, then the evidence could be excluded because of its tendency to inject confusing issues into the case that belong in a federal forum. Given the broad scope of the trial court's powers to exclude relevant evidence when its potential for confusion outweighs its probative value, we see no reason to fear that the superior court would hesitate to exclude it. On the other hand, though, if the evidence is relevant for impeachment and poses no risk of being mistaken as evidence offered to prove an element of Khotol's implied-covenant claim, federal preemption would not bar its admission. [58] On remand, then, the superior court should determine questions concerning the admissibility of such evidence under the Alaska Rules of Evidence, keeping a careful eye on the purposes underlying the doctrine of preemption adopted in Garmon.