Court Opinion

ID: 3003124
Source: CourtListenerOpinion
Date Created: 2015-09-24 20:39:18.411662+00
Date Added: 2024-06-11T18:02:04.476778
License: Public Domain

NONPRECEDENTIAL DISPOSITION
                             To be cited only in accordance with
                                     Fed. R. App. P. 32.1

              United States Court of Appeals
                                    For the Seventh Circuit
                                    Chicago, Illinois 60604

                                   Submitted June 24, 2009*
                                    Decided July 6, 2009

                                             Before

                              KENNETH F. RIPPLE, Circuit Judge

                             MICHAEL S. KANNE, Circuit Judge

                              DIANE S. SYKES, Circuit Judge

No. 09-1561

KENNETH C. GRIMES,                                    Appeal from the United States District
    Plaintiff-Appellant,                              Court for the Southern District of Indiana,
                                                      Evansville Division.
       v.
                                                      No. 3:08-cv-00025-RLY-WGH
CSX TRANSPORTATION, INC.,
      Defendant-Appellee.                             Richard L. Young,
                                                      Judge.

                                           ORDER

        Kenneth Grimes last worked for the Louisville & Nashville Railroad Company in
1981, several years before the railroad was merged into CSX Transportation, Inc. In 2008 he
filed this action against CSX, claiming that during his employment the railroad breached
several terms of its collective bargaining agreement with his union. The district court

       *
         After examining the briefs and the record, we have concluded that oral argument is
unnecessary. Thus, the appeal is submitted on the briefs and the record. See FED . R. APP . P.
34(a)(2).
No. 09-1561                                                                              Page 2
dismissed the complaint, reasoning that the Railroad Labor Act, 45 U.S.C. §§ 151-188,
placed all of Grimes’ claims beyond its subject-matter jurisdiction.

        Grimes was hired in 1976 as an electrician apprentice, but the railroad fired him that
same year for insubordination. His discharge was overturned in 1979 by the National
Railroad Adjustment Board, which ordered that Grimes be reinstated with full seniority
rights but without back pay. Grimes returned to work, but then in 1981 he was laid off for
economic reasons and never recalled. He immediately sued the railroad and his union,
raising several claims about his discharge, reinstatement and furlough. In that suit he also
challenged the Board’s decision not to award him back pay. All of his claims were decided
against him on the merits. See Grimes v. Louisville & Nashville R.R. Co., 583 F. Supp. 642 (S.D.
Ind. 1984), appeal dismissed,(7th Cir. Apr. 24, 1984); Grimes v. Louisville & Nashville R.R. Co.,
No. EV 81-130-C (S.D. Ind. Sept. 14, 1984), aff’d, 767 F.2d 925 (7th Cir. 1985) (unpublished
order). That was the end of the matter until two decades later when Grimes discovered
that the railroad had hired other electricians between 1995 and 2000 instead of recalling
him.

        In his complaint, Grimes accuses the railroad of several contract breaches he
characterizes as “frauds.” The first, he says, was in 1976 when the railroad convened the
disciplinary panel that fired him for insubordination. That action, Grimes insists, was
beyond the railroad’s power to initiate because he already had been sanctioned with a
written reprimand for his infraction. Then in 1979, Grimes continues, the railroad again
violated the labor agreement by assigning him a lower apprentice rating that paid less and
impaired his seniority rights. This latter action, according to Grimes, not only violated the
Board’s directive that he be reinstated with full seniority, but also led to him being laid off
in 1981. What’s more, Grimes adds, the railroad then failed to recall him instead of
employees who otherwise would have had less seniority. He seeks only back pay and
benefits. Although Grimes asserts in his complaint that these facts give rise to claims under
the Railroad Labor Act as well as under Indiana law for fraud, the district court concluded
that the Railroad Labor Act provides the exclusive means for resolving disputes arising
under railway labor agreements.

        Grimes contests the district court’s conclusion that it lacked subject-matter
jurisdiction, apparently arguing that his characterization of the railroad’s actions as
“fraudulent” takes his case outside the scope of the Railroad Labor Act. We review
de novo whether the district court had subject-matter jurisdiction over Grimes’ complaint.
See Int’l Union Pac. of Operating Eng’rs v. Ward, 563 F.3d 276, 278 (7th Cir. 2009).
        Congress created the Railroad Labor Act to govern disputes between railroads and
their employees and thus minimize disruption to commerce. See 45 U.S.C. § 151a; Hawaiian
Airlines, Inc. v. Norris, 512 U.S. 246, 252 (1994). As part of the statutory scheme, railroad
workers must turn first to internal procedures for resolving “minor” disputes, i.e., disputes
No. 09-1561                                                                              Page 3
that can be resolved only by interpreting a collective bargaining agreement. See Andrews v.
Louisville & Nashville R.R. Co., 406 U.S. 320, 324 (1972); Monroe v. Mo. Pac. R.R. Co., 115 F.3d
514, 516-18 (7th Cir. 1997). For a minor dispute that cannot be resolved internally, Congress
granted exclusive jurisdiction to adjudicate the matter to arbitrators on the National
Railroad Adjustment Board or an adjustment board established by agreement between the
railroad and a union. See 45 U.S.C. §§ 152 Sixth, 153 First (i); Consol. Rail Corp. v. Ry. Labor
Executives Ass’n, 491 U.S. 299, 303-04 (1989). A board’s factual findings are not subject to
judicial review, and district courts, although empowered to enforce board decisions, are
limited by the Railroad Labor Act to assessing whether the adjustment board complied
with the statute, whether it stayed within the scope of its mandate, and whether any
member of the board engaged in fraud or corruption. See 45 U.S.C. § 153 First (p), (q); Bhd.
of R.R. Signalmen v. Louisville & Nashville R.R. Co., 688 F.2d 535, 536-37 (7th Cir. 1982). In
short, district courts lack subject-matter jurisdiction to decide the merits of disputes arising
out of a collective bargaining agreement between a railroad and its employees. See
Hawaiian Airlines, 512 U.S. at 252-53. The legal theory underlying the dispute is
unimportant; the Railroad Labor Act broadly encompasses all disagreements bearing on
the labor agreement and precludes a district court from adjudicating even a dispute
ostensibly based on an independent source of federal or state law if “the interpretation of
some provision(s)” of the labor agreement “could be dispositive of the plaintiff’s claim.”
Brown v. Ill. Cent. R.R. Co., 254 F.3d 654, 664 (7th Cir. 2001).

        The “fraud” label Grimes has attached to his allegations against the railroad is thus
unimportant, as are his references to Indiana law. His grievances against the railroad arise
from rights conferred, if at all, by the collective bargaining agreement which governed his
employment, and that labor agreement is thus central to resolving his contentions. They
are, in other words, “minor” disputes that, with one exception, are for an adjustment board
to decide without interference by the district court.

        The exception is Grimes’ claim that the railroad disregarded, not the labor
agreement, but the 1979 ruling of the National Railroad Adjustment Board when the
railroad purportedly failed to fully restore his seniority rights. The facts giving rise to this
obscure theory of relief are buried within a few paragraphs of Grimes’ prolix complaint, so
it is understandable that the import of his allegations was overlooked by the district court.
But pro se complaints must be read liberally, see Haines v. Kerner, 404 U.S. 519, 520 (1972),
and we conclude that Grimes says enough in his complaint to state a claim for enforcement
of the Board’s decision. The district court, then, did have subject-matter jurisdiction to
review whether Grimes’ seniority rights were fully reinstated as ordered by the Board.
This limited jurisdiction, however, did not extend to the other actions of the railroad that
Grimes challenged; the collective bargaining agreement—not an order of the Board—is the
source of any rights Grimes had to avoid further discipline, to be protected from a layoff, or
to be recalled from his furlough. Similarly, although the Railroad Labor Act grants district
No. 09-1561                                                                           Page 4
courts jurisdiction to hear claims of fraud by members of the adjustment board, see 45 U.S.C.
§ 153 First (q), Grimes complains of fraud during the internal company proceedings, not by
any member of the adjustment board.

         It follows that the district court was mistaken when it concluded that it lacked
subject-matter jurisdiction entirely. But the misstep does not require a remand because
Grimes’ suit against the railroad is frivolous. The district court would have been
empowered to ensure that Grimes’ seniority rights were properly reinstated, if not for the
fact that Grimes faced another, insurmountable obstacle: the Railroad Labor Act requires an
enforcement suit to be filed within two years of when a claim accrues. 45 U.S.C. § 153 First
(r). If the railroad flouted the Board’s reinstatement order by not fully restoring Grimes to
his former position when he returned to work, he certainly would have known about that
action in 1979 and should have sued years ago. Therefore, this one claim should have been
dismissed, not for lack of jurisdiction, but under Federal Rule of Civil Procedure 12(b)(6).
See Andonissamy v. Hewlett-Packard Co., 547 F.3d 841, 847 (7th Cir. 2008).

                                                                                 AFFIRMED