Labor & Employment Law

Cert granted on Section 301 suit: tortious interference and duty to arbitrate

The US Supreme Court has granted certiorari in an LMRA Section 301 case that raises issues on (1) whether an employer can state a claim of tortious interference against a union that was not a signatory to a collective bargaining agreement, and (2) the scope of the duty to arbitrate. This case will be argued in the fall.

Granite Rock v. Teamsters (Certiorari granted 06/29/2009)

The employer sued a local union and an international union under Labor Management Relations Act Section 301(a) claiming that (1) the international union tortiously interfered with a collective bargaining agreement (CBA) between the employer and the local union, and (2) the local union breached the CBA by going on strike.

The employer and the local union had reached a tentative new CBA which contained a broad arbitration clause and a no-strike clause. The employer alleged that the local union had ratified the CBA and then engaged in a strike which was in part led by a high official of the international union.

(1) The 9th Circuit held that the employer failed to state a claim against the international union because the tortious interference claim did not "arise under" the CBA between the employer and the local. The court reasoned that because the international "has no rights or duties under the agreement ? [the employer?s] tortious interference claim ? does not meet the requirements of section 301(a)."

(2) As to the contract claim, the parties disagreed on the date of ratification. The district court held that issues of breach and damages had to be arbitrated, but that the issue of contract ratification was for the court to decide. The 9th Circuit held that the entire dispute should go to arbitration under the contract's arbitration clause, which covered "all disputes arising under this agreement." The court held that both parties consented to arbitration; the employer by suing under the contract, and the union by moving to compel arbitration.

The US Supreme Court granted certiorari to review the 9th Circuit's judgment.

Full post as published by Ross' Employment Law Blog on June 30, 2009 (boomark / email).