Shiflett v. ITO ( 2000 )

Filed: February 2, 2000
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 99-1379
(CA-98-3456-S)
Ray J. Shiflett,
Plaintiff - Appellant,
versus
I.T.O. Corporation, et al,
Defendants - Appellees.
O R D E R
The court amends its opinion filed January 10, 2000, as
follows:
On page 4, first paragraph, line 14 -- the word “removed” is
corrected to read “remanded.”
For the Court - By Direction
/s/ Patricia S. Connor
Clerk
UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
RAY J. SHIFLETT,
Plaintiff-Appellant,
v.
No. 99-1379
I.T.O. CORPORATION OF BALTIMORE;
WILLIAM LINDSAY,
Defendants-Appellees.
Appeal from the United States District Court
for the District of Maryland, at Baltimore.
Frederic N. Smalkin, District Judge.
(CA-98-3456-S)
Argued: December 2, 1999
Decided: January 10, 2000
Before MURNAGHAN and WILLIAMS, Circuit Judges,
and Cynthia H. HALL, Senior Circuit Judge of the
United States Court of Appeals for the Ninth Circuit,
sitting by designation.
_________________________________________________________________
Affirmed by unpublished per curiam opinion.
_________________________________________________________________
COUNSEL
ARGUED: Ransom J. Davis, DANKER, MCINTIRE, DAVIS,
SCHUMM, PRINCE & GOLDSTEIN, P.C., Baltimore, Maryland, for
Appellant. Gil A. Abramson, HOGAN & HARTSON, L.L.P., Balti-
more, Maryland, for Appellees. ON BRIEF: Mark S. Saudek,
HOGAN & HARTSON, L.L.P., Baltimore, Maryland, for Appellees.
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
_________________________________________________________________
OPINION
PER CURIAM:
Ray Shiflett filed suit against his former employer, I.T.O. Corpora-
tion of Baltimore (ITO), and his former supervisor, William Lindsay,
alleging false arrest and imprisonment, malicious prosecution, false-
light defamation, and wrongful termination of employment arising out
of Shiflett's arrest by Baltimore Port Authority Police after ITO
reported that Shiflett had stolen ITO property. The United States Dis-
trict Court for the District of Maryland granted ITO and Lindsay's
motion to dismiss on the grounds that § 301 of the Labor Manage-
ment Relations Act (LMRA) preempted Shiflett's state law claims
and because Shiflett failed to exhaust his remedies. Shiflett argues
that the district court erred in dismissing his state law claims against
ITO because they require no interpretation of the collective bargain-
ing agreement and, therefore, warrant no preemption under § 301.
Shiflett also argues that the district court erred by dismissing his state
law claims against Lindsay on the basis of preemption because Lind-
say, as an individual, is not a signatory to the collective bargaining
agreement. Finally, Shiflett contends that he does not have to exhaust
his remedies because his Union, Local 333, International Longshore-
man's Association, is openly hostile to him. For the reasons that fol-
low, we affirm the district court's dismissal of Shiflett's claims.
I.
On September 27, 1995, Shiflett was working as a mechanic for
ITO at the Dundalk Marine Terminal in Baltimore City. Lindsay, who
was Shiflett's supervisor, saw Shiflett remove a master brake cylinder
from an abandoned 1976 Chevrolet and place it in his own car. Lind-
say reported this apparent theft to ITO, which in turn called the Balti-
more Port Authority Police. The next morning, when Shiflett reported
for work, Port Authority police arrested him for theft and surrendered
2
him to the Baltimore City Police Department. On the same day, ITO
fired him.1
Shiflett, as a Union member and ITO employee, was subject to the
Cargo Agreement, which is the collective bargaining agreement
between ITO and the Union. The Cargo Agreement specifies that "pil-
fering or broaching of cargo [and] theft . . . are Major Offenses which
may be dealt with as the circumstances may require, including dis-
charge" and without prior notice to the Union. (J.A. at 53.) The Cargo
Agreement also contains grievance procedures for employees who are
wrongly disciplined.
After ITO fired Shiflett, the Union negotiated a compromise with
ITO to reinstate Shiflett. Under the compromise, ITO agreed to rein-
state Shiflett to his former position, with no back pay awarded, pro-
vided that Shiflett "agree[d] not to take any further action against any
parties with respect to the circumstances underlying his termination
and reinstatement." (J.A. at 166.) Although Shiflett refused to sign the
agreement, ITO permitted Shiflett to return to work in January 1996.
Shortly before he returned to work, on December 4, 1995, the prose-
cutor nol prossed the theft charges against Shiflett.
After returning to ITO, Shiflett remained concerned about the back
pay that he lost as a result of the September 27, 1995 incident. On
October 28, 1996, Shiflett sent a letter to the Union president request-
ing an arbitration date to resolve the back pay issue. The Union appar-
ently did not respond to Shiflett's request, and Shiflett apparently did
not send any further correspondence to the Union on this issue.
Nearly two years later, on August 20, 1998, Shiflett's counsel sent a
letter to ITO describing at least $9,070.00 in back pay losses and
demanding resolution of the dispute. On September 25, 1998, ITO's
counsel responded with a letter suggesting that Shiflett seek redress
through the Cargo Agreement's grievance procedures. ITO's counsel
stated that ITO would not raise any timeliness issues with respect to
_________________________________________________________________
1 Shiflett explains that he did not intend to steal the cylinder, but rather
that he intended to transfer the cylinder to another ITO vehicle. He also
contends that Lindsay had a long-standing grudge against him. It is
undisputed, however, that Shiflett removed the cylinder from the vehicle
and that Lindsay saw him do so.
3
the grievance procedures. ITO's counsel attached a check for $198.48
for thirteen hours of lost back pay that ITO believed Shiflett was due.
Shiflett refused the check. On or about September 28, 1998, Shiflett
filed a complaint in the Circuit Court of Maryland alleging false arrest
and imprisonment, malicious prosecution, false-light defamation, and
wrongful termination of employment. On October 15, 1998, ITO
removed the case to federal court. On December 8, 1998, the district
court denied Shiflett's motion to remand to state court, finding that
"[i]t is crystal clear that the plaintiff's entire case, including the tort
claims, are `firmly rooted' in the Cargo Agreement, which leads to a
conclusion that there is sufficient federal preemption under section
310 of the LMRA to give this Court removal jurisdiction." (J.A. at
74.) On December 28, 1998, Shiflett voluntarily dismissed his wrong-
ful termination claim and argued that the case should be remanded
because there was no longer any basis for § 301 preemption. The dis-
trict court disagreed. In the meantime, Shiflett had additional trouble
at work. On February 3, 1999, after two disciplinary incidents, ITO
terminated Shiflett.2 On February 19, 1999, the district court granted
ITO's motion to dismiss on the grounds of § 301 preemption and fail-
ure to exhaust remedies.
On March 1, 1999, Shiflett's counsel finally sent a letter to ITO's
counsel seeking to reinstitute grievance procedures. On March 9,
1999, Shiflett's counsel sent a similar request to the Union. On March
19, 1999, Shiflett filed his notice of appeal to this Court.
_________________________________________________________________
2 In the first incident, which occurred in May 1998, Shiflett apparently
threw ashes from an ashtray into Lindsay's face. ITO initially wanted to
suspend Shiflett for ninety days, but the Union negotiated a compromise
under which ITO would suspend Shiflett for sixty days with the express
warning that any other confrontations would lead to termination. Shiflett
agreed to sign a letter to this effect, but thereafter refused to sign the let-
ter. The next incident, which led to Shiflett's termination, occurred on
February 3, 1999 when Shiflett apparently shouted at and shoved a fore-
man in a dispute over his time sheet. Shiflett disputes this version of
events, and the Union arranged for a grievance hearing for September 13,
1999. The results of that hearing are not part of our record on appeal.
4
II.
Shiflett raises several issues on appeal that we will address in turn.
First, he argues that the district court erred in concluding that § 301
preempted his state law claims for false arrest and imprisonment,
malicious prosecution, and false-light defamation. Second, Shiflett
contends that § 301 could not have preempted his claims against
Lindsay because Lindsay, as an individual, is not a signatory to the
Cargo Agreement. Third, Shiflett asserts that the district court erred
in requiring that he exhaust his remedies under the Cargo Agreement
because the Union was openly hostile to him as demonstrated by its
failure to respond to his earlier request for arbitration.
III.
Shiflett initially argues that preemption of his state law claims
under § 301 of the Labor Management Relations Act (LMRA) is
unwarranted because his claims arise solely from state substantive
law. Therefore, he asserts, it is unnecessary to interpret the Cargo
Agreement in order to resolve his claims against ITO. Applying the
appropriate de novo standard of review, see Brooks v. City of
Winston-Salem, 85 F.3d 178, 181 (4th Cir. 1996) (reviewing grant of
motion to dismiss de novo); Meekins v. United Transp. Union, 946
F.2d 1054, 1057 (4th Cir. 1991) ("We review the district court's
determinations of law de novo."), we disagree and affirm the district
court's conclusion that § 301 preempts Shiflett's claims against ITO.
Section 301 of the LMRA "provides federal courts with jurisdiction
over employment disputes covered by collective bargaining agree-
ments [and] also directs federal courts to fashion a body of federal
common law to resolve such disputes."3 McCormick v. AT&T Tech-
_________________________________________________________________
3 Section 301 of the LMRA states that
Suits for violation of contracts between an employer and a labor
organization representing employees in an industry affecting
commerce . . . may be brought in any district court of the United
States having jurisdiction of the parties, without respect to the
amount in controversy or without regard to the citizenship of the
parties.
29 U.S.C.A. 185(a) (West 1998).
5
nologies, Inc., 934 F.2d 531, 534 (4th Cir. 1991) (en banc). Indeed,
"the preemptive force of § 301 is so powerful as to displace entirely
any state cause of action `for violation of contracts between an
employer and a labor organization.'" Franchise Tax Bd. v. Construc-
tion Laborers Vacation Trust, 463 U.S. 1, 23 (1983) (internal quota-
tion marks and citation omitted). In determining whether a claim
warrants preemption, "the question in preemption analysis is not
whether the source of a cause of action is state law, but whether reso-
lution of the cause of action requires interpretation of a collective bar-
gaining agreement." McCormick, 934 F.2d at 535. The collective
bargaining agreement consists of both the express provisions of the
agreement and the "industrial common law," which includes industry
and shop practices that exist outside of the agreement's text and that
furnish the context of the agreement. See id. at 536. "Thus, the agree-
ment creates in employees and their employers implied rights and
duties, the contours of which are a matter of `federal contract interpre-
tation.'" Id. (quoting AllisChalmers Corp. v. Lueck, 471 U.S. 202, 215
(1985)).
In McCormick, we outlined the proper standards for § 301 preemp-
tion in this Circuit. McCormick involved an employer, AT&T, that
discarded personal belongings from McCormick's work locker after
he was fired, including a personal letter that was retrieved by his co-
workers. See 934 F.2d at 533. We concluded that § 301 preempted
McCormick's state law claims for intentional infliction of emotional
distress, negligent infliction of emotional distress, conversion, and
negligence in the care of a bailment. See id. at 534. We noted that
§ 301 preempts state law claims that require reference to the collec-
tive bargaining agreement in order to determine whether the employer
has a "duty of care," and to define the nature, extent, and scope of that
duty. See id. at 536. After examining the elements of McCormick's
state law claims, we found that each of his claims required some com-
ponent of wrongfulness on the part of AT&T before liability could
attach. See id. at 535. Consequently, because wrongfulness in this
context could not be determined in the abstract, we concluded that it
was necessary to interpret the collective bargaining agreement to
determine "whether and to what extent AT&T owed McCormick a
duty concerning his work locker." Id. at 536-37. We determined that
"[i]f [AT&T] owed him no duty and was entitled under the agreement
to dispose of the contents of his locker in the manner it did, its actions
6
ipso facto could not have been wrongful under state law." Id. at 537.
Whether AT&T's actions could be authorized under the collective
bargaining agreement necessarily turned on an interpretation of that
agreement. Accordingly, we held that McCormick's claims were pre-
empted. See id.
Applying the McCormick analysis, we first look to the state law
elements of Shiflett's claims to determine whether interpretation of
the Cargo Agreement is necessary to resolve his claims. See id. at
535. Under Maryland law, the elements of defamation are: (1) the
defendant makes a defamatory statement to a third person; (2) that
statement is false; (3) the defendant is legally at fault in making the
statement; (4) the plaintiff suffered harm; and (5) the statement
exposes the plaintiff to public scorn, hatred, ridicule, or contempt.4
See Woodruff v. Trepel, 725 A.2d 612, 617 (Md. Ct. Spec. App.
1999). False imprisonment requires "`deprivation of the liberty of
another without his consent and without legal justification.'"5
_________________________________________________________________
4 Shiflett alleges "false-light/defamation" against ITO and Lindsay.
(Appellant's Br. at 19.) Under Maryland law, false light is not actually
a creature of defamation but rather is a form of invasion of privacy. See
Ostrzenski v. Seigel, 177 F.3d 245, 252 (4th Cir. 1999) (describing false
light under Maryland law as a publication that unreasonably places the
plaintiff in a false light if: (a) the false light would be highly offensive
to a reasonable person; and (b) the defendant knew or recklessly disre-
garded the falsity of the publicized matter and the false light in which the
plaintiff would be placed). Based upon Shiflett's brief (see Appellant's
Br. at 19 (describing the elements of false-light defamation as a false
statement that exposes the plaintiff to public scorn, contempt or ridicule,
published to a third person who reasonably understands it to be defama-
tory, that in fact damages the plaintiff's reputation)), we construe Shif-
lett's claim as one for defamation. In any event, we do not believe that
the distinction between false light and defamation materially affects our
analysis because each requires a component of fault or unreasonableness
before liability can attach. See id. (stating that false light requires an
unreasonable publication and knowledge or reckless disregard of falsity);
Woodruff v. Trepel, 725 A.2d 612, 617 (Md. Ct. Spec. App. 1999) (stat-
ing that defamation requires falsity and legal fault); cf. Bagwell v. Penin-
sula Reg'l Med. Ctr., 665 A.2d 297, 315 n.8 (Md. Ct. Spec. App. 1995)
(noting that "the principles governing defamation and false light signifi-
cantly overlap").
5 False arrest has the same elements as false imprisonment. See Green
v. Brooks, 725 A.2d 596, 605 (Md. Ct. Spec. App. 1999).
7
Montgomery Ward v. Wilson, 664 A.2d 916, 926 (Md. 1995) (quoting
Great Atl. & Pac. Tea Co. v. Paul, 261 A.2d 731, 738 (Md. 1970)).
Malicious prosecution requires: (1) a criminal proceeding against the
plaintiff that was instituted or continued by the defendant; (2) termi-
nation of that proceeding in the plaintiff's favor; (3) absence of proba-
ble cause; and (4) malice, which is defined as a primary purpose other
than bringing the plaintiff to justice. See id. at 922. In this context,
probable cause means "a reasonable ground for belief in the existence
of such state of facts as would warrant institution of the suit or pro-
ceedings complained of." One Thousand Fleet Ltd. Partnership v.
Guerriero, 694 A.2d 952, 956 (Md. 1997) (quoting North Point Con-
str. Co. v. Sagner, 44 A.2d 441, 445 (Md. 1945)). Malice means "ac-
tuated by an improper motive;" this motive can be inferred from a
lack of probable cause. Id.Our examination of Shiflett's state law claims reveals one com-
monality among each of his claims that affects our analysis. Each of
Shiflett's claims includes an element of wrongfulness that goes to the
manner and nature of ITO's conduct in light of the information that
it had at the time of the alleged wrong. Specifically, false-light defa-
mation requires a false statement and "legal[ ] . . . fault in making the
statement," Woodruff, 725 A.2d at 617 (internal quotation marks
omitted); false arrest requires absence of "legal justification," Wilson,
664 A.2d at 926; and malicious prosecution requires lack of "probable
cause" or a lack of "reasonable grounds for belief," One Thousand
Fleet, 694 A.2d at 956. ITO's duty with respect to these elements --
including the nature and extent of that duty -- does not exist in the
abstract. To determine whether ITO acted improperly when it
responded to Shiflett's purported theft, it is necessary to ascertain
ITO's authority and responsibilities with respect to its employees in
light of ITO's knowledge at the time of the incident. The manner and
propriety of ITO's investigation and its subsequent decision to call the
Port Authority police "is not a matter of intrinsic moral import but a
question of legal authority -- whether management had the lawful
right to proceed as it did." McCormick, 934 F.2d at 536. Conse-
quently, resolution of Shiflett's state law claims requires an examina-
tion of the Cargo Agreement, including the industrial common law,
to determine whether ITO acted wrongfully in its investigation and
treatment of Shiflett.
8
The Cargo Agreement contains several provisions that deal
squarely with allegations of employee theft, ITO's disciplinary
authority to deal with theft, and employee grievance procedures for
addressing wrongful action by ITO. For example, section IX.23 (iii),
which relates to ITO's authority to discipline its employees without
prior notice to the Union, states that "pilfering or broaching of cargo,
theft . . . are Major Offenses which may be dealt with as the circum-
stances may require, including discharge." (J.A. at 53 (emphasis
added).) The same section also provides that "[a]ny grievances or dis-
putes hereunder may be submitted to the grievance procedure." (J.A.
at 53.) The essence of these provisions is that ITO may, "as the cir-
cumstances may require," investigate and deal with employee theft.
We have difficulty believing that ITO, by following investigative and
disciplinary procedures contemplated by the Cargo Agreement in
determining whether an employee has engaged in theft, can also act
unreasonably for the purposes of fault, probable cause, or legal justifi-
cation. Yet, this is exactly the ground for Shiflett's complaint. (See
J.A. at 15 ("A minimal investigation by [ITO] and/or a simple inquiry
of [Shiflett] concerning his conduct would have revealed that no
improper or unlawful activity on his part was involved.").) The Cargo
Agreement explicitly grants ITO a certain level of authority and dis-
cretion to deal with employee theft. The bounds, scope, and reason-
ableness of ITO's exercise of that authority can only be determined
through an interpretation of the Cargo Agreement as supplemented by
industrial common law. Cf. Willis v. Reynolds Metals Co., 840 F.2d
254, 255 (4th Cir. 1988) ("[T]he alleged wrong by Reynolds in the
instant case directly dealt with its right pursuant to a collective bar-
gaining agreement to conduct investigations . . . and the associated
right to confront the suspected employee."); Mock v. T.G.&Y Stores
Co., 971 F.2d 522, 529 (10th Cir. 1992) (affirming district court's
conclusion that § 301 preempted plaintiff's various state law claims,
including false imprisonment).
Our examination of Shiflett's state law claims and the Cargo
Agreement lead us to conclude that Shiflett's claims are preempted by
§ 301. We note that, unlike other decisions in which we found no pre-
emption "because the claims involved purely factual questions con-
cerning the conduct of the employee and the conduct and motivation
of the employer, and because no interpretation of the collective bar-
gaining agreement was required," Owen v. Carpenters' Dist. Council,
9
161 F.3d 767, 776 (4th Cir. 1998), the present case implicates issues
of contractual, rather than factual, interpretation. Indeed, the facts in
the present case are virtually undisputed: Shiflett took ITO property
and placed it in his own car; Lindsay saw Shiflett take this property
and, pursuant to his duties as Shiflett's supervisor, reported his obser-
vation to ITO, which responded by calling the Port Authority Police.
The Port Authority Police then decided to arrest Shiflett and turn him
over to the Baltimore City Police. The only question, for our pur-
poses, is whether ITO's response to Lindsay's report -- calling the
Port Authority Police upon an allegation of theft from one of its
supervisors -- was unreasonable. In other words, the inquiry is
whether ITO, in light of the information that it had at the time, prop-
erly acted "as the circumstances . . . require[d]" by investigating and
reporting Lindsay's observations to the Port Authority Police in the
manner that it did. This question can only be answered by the Cargo
Agreement, including the industrial common law. For that reason, we
agree that Shiflett's claims against ITO are preempted by § 301.
IV.
Shiflett next contends that even if his claims against ITO are pre-
empted, his claims against Lindsay are not because Lindsay, as an
individual, is not a signatory to the collective bargaining agreement.
Again, applying a de novo review of the preemption question, see
Brooks v. City of Winston-Salem, 85 F.3d 178, 181 (4th Cir. 1996)
(reviewing grant of motion to dismiss de novo); Meekins v. United
Transp. Union, 946 F.2d 1054, 1057 (4th Cir. 1991) ("We review the
district court's determinations of law de novo"), we disagree and
affirm the district court's conclusion that § 301 preempts Shiflett's
claims against Lindsay.
We have previously addressed whether it is possible for § 301 to
preempt state law claims asserted against a non-signatory to a collec-
tive bargaining agreement. In International Union, United Mine
Workers of America v. Covenant Coal Corp., 977 F.2d 895 (4th Cir.
1992), we considered whether § 301 "confer[red] federal jurisdiction
to hear claims against non-signatories of a collective bargaining
agreement for tortious interference with that agreement." Id. at 897.
In Covenant Coal, International Union, United Mine Workers of
America (the Union) appealed the district court's dismissal of its
10
§ 301 claim against Covenant Coal based upon tortious interference
with contract, which alleged that Covenant had interfered with the
Union's collective bargaining agreement with various mine operators.
See id. at 896. Covenant, however, was not a signatory to the collec-
tive bargaining agreement. See id. at 895-96. Faced with the issue of
whether the Union could assert a § 301 claim against a non-signatory
such as Covenant, we concluded that "a suit against a non-signatory
of a contract cannot be considered a suit for violation of the contract"
and affirmed the district court's dismissal of the Union's § 301 claim.
Id. at 897. We then addressed whether the district court erred in dis-
missing the Union's Virginia state law claim for tortious interference
with contract on the ground of § 301 preemption. See id. at 899. Ana-
lyzing Virginia law, we noted that one of the elements of tortious
interference with contract is a breach or termination of the contract
and that "[o]nly by interpreting a contract can a court determine
whether the contract has been breached." Id. We accordingly con-
cluded that the Union's claim against Covenant was preempted by
§ 301 notwithstanding that Covenant was not a signatory of the col-
lective bargaining agreement. See id. In doing so, we noted that "[w]e
are cognizant of the apparent paradox, inherent in our decision of this
case, holding that section 301 of the LMRA bars a federal cause of
action for tortious interference with contract, yet simultaneously pre-
empts the identical state law cause of action." Id.
Our decision in Covenant Coal clearly recognizes that § 301 can
preempt state law claims against a non-signatory to a collective bar-
gaining agreement.6 Shiflett asserts, nevertheless, that we should
reverse the district court because Covenant Coal is distinguishable:
Covenant was a corporate entity whereas Lindsay is an individual.
Shiflett relies on Judge Phillips's concurrence in Jackson v. Kimel,
992 F.2d 1318 (4th Cir. 1993), to argue that claims against an individ-
ual non-signatory can never be preempted under § 301. Jackson
_________________________________________________________________
6 Likewise, the Fifth Circuit has held that § 301 can preempt claims
against an individual employee. See Baker v. Farmers Electric Coop.,
Inc., 34 F.3d 274, 283-84 (5th Cir. 1994) ("In cases involving claims
against fellow employees where the question of section 301 preemption
has arisen, courts have governed their determinations on the preemption
by the necessity of referring to a CBA for resolution of the claim rather
than by the individual status of the defendant.").
11
involved Kimel, a supervisor for AT&T, who allegedly sexually
harassed Jackson, an employee under his supervision. See 992 F.2d
at 1321. Jackson sued AT&T and included Kimel as an individual
defendant in her suit. The district court granted summary judgment on
Jackson's claims against both defendants. See id. at 1320. We
affirmed the district court's grant of summary judgment in favor of
AT&T because Jackson failed to offer sufficient evidence of
respondeat superior or negligent retention. See id. at 1323. We
reversed the district court's grant of summary judgment with respect
to Kimel, however, because Jackson offered sufficient evidence to
sustain her state law claim of intentional infliction of emotional dis-
tress. See id. at 1325. We then addressed whether § 301 preempted
Jackson's claim against Kimel. See id. We noted that "[a]s an
employee of AT&T, Kimel is not a signatory to the collective bar-
gaining agreement and cannot be sued for violation of the collective
bargaining agreement except as an agent of AT&T." Id. at 1325 n.4.
Therefore, "[i]f Jackson's claim against Kimel is preempted by § 301,
then summary judgment would be appropriate both because Jackson
failed to exhaust her grievance procedures and because Kimel would
not be a proper party to a § 301 action." Id. at 1325. After applying
the standards of McCormick v. AT&T Technologies, Inc., 934 F.2d
531 (4th Cir. 1991), we concluded that § 301 did not preempt Jack-
son's claim against Kimel because Jackson's claim did not require
interpretation of the collective bargaining agreement. See Jackson,
992 F.2d at 1326. Consequently, we did not address whether § 301
could preempt a state law claim against an individual co-employee.
Judge Phillips's concurrence argued that it was inappropriate to
address the preemption issue with respect to Jackson's state law claim
against Kimel because "[he did not] believe § 301 preemption was
possible as to that claim." Id. at 1328 (Phillips, J., concurring). Judge
Phillips reasoned that "[w]hen union employees have sought directly
to sue fellow employees in § 301 actions, the claims rightly have been
dismissed on the obvious basis that as non-signatories to the employ-
er's collective bargaining agreement, such employees are not amena-
ble to claims for that contract's breach." Id. Consequently, "[i]t would
be anomalous indeed . . . if such a fellow-employee could neverthe-
less be considered a proper party defendant to a state-law tort claim
`recharacterized' by preemption as a § 301 breach of contract action."
Id.
12
Judge Phillips's concurrence, however, recognized and attempted
to distinguish our earlier decision in Covenant Coal, in which we held
"that a pendent state-law claim against a non-signatory to a labor con-
tract is subject to § 301 preemption."7 Id. This Circuit has not adopted
Judge Phillips's concurrence, nor do we do so now because Covenant
Coal explicitly recognized that state law claims against a non-
signatory to a collective bargaining agreement can be preempted by
§ 301. We can find no principled distinction between a corporate non-
signatory and an individual non-signatory that would allow us to
avoid our required adherence to binding Circuit precedent. See
Industrial Turnaround Corp. v. NLRB, 115 F.3d 248, 254 (4th Cir.
1997) (stating that this Court is bound by a prior decision of another
panel absent an en banc overruling or a superseding contrary Supreme
Court decision).
In the present case, Shiflett's state law claims against Lindsay for
defamation, malicious prosecution, and false arrest are identical to
Shiflett's state law claims against ITO. Each of these state law claims
also arises from a common set of facts under which ITO "accepted,
adopted, ratified and acted upon" Lindsay's accusation of theft as a
basis for its decision to call the Port Authority Police. (J.A. at 19.)
Because Shiflett's state law claims against ITO and Lindsay are iden-
tical, we believe that resolution of Shiflett's state law claims against
Lindsay, like his state law claims against ITO, require interpretation
of the Cargo Agreement. See ante Part III (discussing preemption of
Shiflett's state law claims against ITO). For that reason, we affirm the
district court's conclusion that Shiflett's state law claims against
Lindsay are preempted by § 301.
V.
Shiflett next argues that the district court erred in concluding that
his claims against ITO and Lindsay were barred by his failure to
_________________________________________________________________
7 Judge Phillips distinguished Covenant Coal on the basis that "it
involved a federal action in which the primary claim directly invoked
§ 301 (the claimant in effect `asked for it'), rather than a removed state
court action, and it involved a defendant against whom other avenues of
relief were available." Jackson v. Kimel, 992 F.2d 1318, 1329 (4th Cir.
1993) (Phillips, J., concurring).
13
exhaust his remedies under the Cargo Agreement because the Union
was openly hostile to him and failed to respond to his earlier arbitra-
tion request. We disagree.
Generally, a plaintiff must exhaust his remedies before he can
bring suit under § 301 in federal court. See Clayton v. International
Union, 451 U.S. 679 (1981). There are some limited exceptions to the
exhaustion requirement, such as where "the internal union appeals
panels cannot reactivate [the] grievance and cannot grant [Shiflett's]
reinstatement relief he seeks under § 301." Id. at 696. In such circum-
stances, "[i]f the internal procedures are inadequate, the employee's
failure to exhaust should be excused, and he should be permitted to
pursue his claim for breach of duty of fair representation and breach
of the collective-bargaining agreement in court under § 301." Id. In
Clayton, the Court noted that
courts have discretion to decide whether to require exhaus-
tion of internal union procedures. In exercising this discre-
tion, at least three factors should be relevant: first, whether
union officials are so hostile to the employee that he could
not hope to obtain a fair hearing on his claim; second,
whether the internal union appeals procedures would be
inadequate either to reactivate the employee's grievance or
to award him the full relief he seeks under § 301; and third,
whether exhaustion of internal procedures would unreason-
ably delay the employee's opportunity to obtain a judicial
hearing on the merits of his claim. If any of these factors are
found to exist, the court may properly excuse the employ-
ee's failure to exhaust.
Id. at 689. We review the district court's decision whether to excuse
the exhaustion requirement for an abuse of discretion. See id.
In the present case, the Cargo Agreement provides that "[a]ny
grievances or disputes hereunder may be submitted to the grievance
procedure." (J.A. at 53.) It is undisputed, however, that Shiflett did
not exhaust his remedies under the Cargo Agreement before bringing
his state law claims against ITO and Lindsay. Shiflett argues that pur-
suant to Clayton, the district court should have excused his failure to
14
exhaust his remedies because the Union was openly hostile to him. In
particular, he argues that
the Union cannot be relied upon to accord him a fair and
impartial hearing on his grievance. Indeed, Plaintiff's griev-
ance, including his claim for compensation for his lost earn-
ings during the period of time he was unjustly suspended,
has been allowed to languish unattended to and unresolved
for three years.
(Appellant's Br. at 29.)
However, the only possible evidence of any Union hostility
towards Shiflett is that it apparently did not respond to his October
1996 request for arbitration.8 This lone instance is not enough. Our
reading of the record clearly demonstrates that the Union has, on sev-
eral occasions, represented Shiflett quite adequately. It negotiated a
compromise with ITO to reinstate Shiflett after the September 27,
1995 theft incident, although Shiflett later refused to sign the agree-
ment. The Union negotiated successfully with ITO to reduce Shiflett's
suspension from ninety days to sixty days after Shiflett threw ashes
in Lindsay's face, although Shiflett again refused to sign the agree-
ment. The Union arranged for a September 13, 1999 grievance hear-
ing to resolve Shiflett's disputed February 3, 1999 termination. And,
even after the district court dismissed Shiflett's state law claims
against ITO and Lindsay, the Union remained responsive to Shiflett's
concerns with respect to the September 27, 1995 theft incident.
Assuming that the Union initially failed to facilitate arbitration after
Shiflett's October 1996 letter, we have little difficulty concluding that
Shiflett has otherwise relied quite extensively, and successfully, on
the Union throughout the course of his employment. Consequently,
the district court did not abuse its discretion in refusing to excuse
Shiflett's failure to exhaust his remedies under the Cargo Agreement.
We note that before Shiflett filed suit in federal court, ITO sug-
gested that Shiflett pursue his grievance procedures under the Cargo
Agreement and stated that ITO would not raise any timeliness issues
_________________________________________________________________
8 From the record, it is unclear whether the Union responded, and if it
did, what action it took.
15
as to the filing of his grievance. Yet, Shiflett ignored this suggestion
until the district court ruled against him. Given the extensive and
facially adequate history of Union representation on behalf of Shiflett,
we are left to conclude that Shiflett's failure to exhaust his remedies
is more a reflection of his personal choice to forego the grievance pro-
cedures than the Union's purported hostility toward him. (See J.A. at
200-01 (stating in letter from Shiflett's counsel to ITO's counsel
dated March 1, 1999 that "Mr. Shiflett now wants to initiate and/or
continue such a grievance").) Moreover, it is not our role to evaluate
the subjective quality of the Union's representation in light of its
record of success in securing, on multiple occasions, reinstatement
and other benefits for Shiflett. We affirm the district court's conclu-
sion that Shiflett inexcusably failed to exhaust his remedies before
bringing suit against ITO and Lindsay.9
VI.
In conclusion, Shiflett's claims against ITO are preempted by § 301
of the LMRA because each of his claims requires interpretation of the
Cargo Agreement. Shiflett's claims against Lindsay, as an individual,
are also preempted because, like Shiflett's identical claims against
ITO, they also require interpretation of the Cargo Agreement. Finally,
we conclude that the district court did not abuse its discretion in deter-
mining that Shiflett had to, but did not, exhaust his remedies under
the Cargo Agreement before bringing his claims against ITO and
Lindsay. For these reasons, we affirm the judgment of the district
court.
AFFIRMED
_________________________________________________________________
9 Shiflett also argues that the district court erred in finding that the stat-
ute of limitations barred his claims. We need not reach this issue
because, as noted above, Shiflett inexcusably failed to exhaust his reme-
dies. Moreover, our reading of the district court's order indicates that the
district court did not actually address whether the statute of limitations
barred Shiflett's claims.
16