# Kioussis v. Service Employees International Union Local 668

> District Court, M.D. Pennsylvania · December 10, 2019

URL: https://www.frixlaw.com/law-library/cases/10408124

## Case

- **Court:** District Court, M.D. Pennsylvania
- **Decided:** December 10, 2019
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF PENNSYLVANIA
JANINE WENZIG and :
CATHERINE KIOUSSIS,
:

Plaintiffs, :
CIVIL ACTION NO. 1:19-1367
v. :
(JUDGE MANNION)
SERVICE EMPLOYEES :
INTERNATIONAL UNION
LOCAL 668, :

Defendant :
MEMORANDUM
Pending before the court is the motion to dismiss the first amended
complaint (“FAC”), (Doc. 19), of plaintiffs Janine Wenzig and Catherine
Kioussis filed by defendant Service Employees International Union Local 668
(“SEIU”), (Doc. 25). Defendant’s motion seeks dismissal of this case for
failure to state a claim upon which relief may be granted pursuant to
Fed.R.Civ.P. 12(b)(6). SEIU contends that plaintiffs’ First Amendment claims
against it, in this putative class action, for retrospective monetary relief under
42 U.S.C. §1983 should be dismissed since it relied in good faith on the
formerly valid Pennsylvania law and longstanding United States Supreme
Court precedent that allowed it to collect fair-share fees from public-sector
employees who were not members of the union. For the reasons that follow,
SEIU’s motion to dismiss under Rule 12(b)(6) will be GRANTED and,
plaintiffs’ federal claims against SEIU will be DISMISSED WITH PREJUDICE.
1
I. BACKGROUND
Plaintiffs bring this civil rights action pursuant to 42 U.S.C. §1983.'
Plaintiffs are both employed by the Commonwealth of Pennsylvania. Wenzig
is employed by the Department of Human Services as a Licensing Supervisor
and Kioussis is an Income Maintenance Supervisor. SEIU is a labor union
with its headquarters in Harrisburg, Pennsylvania, and it is the exclusive
representative for several bargaining units in the state, including plaintiffs’
bargaining unit. As members of the bargaining unit represented by SEIU,
plaintiffs received the benefits of the Collective Bargaining Agreement (“CBA”)
between SEIU and Pennsylvania. However, even though plaintiffs were not
members of SEIU, they allege that the union was legally allowed to collect fair
share fees from them under Pennsylvania’s Public Employee Fair Share Fee
Law, “43 Pa.Stat.Ann. §1102.3”, since it represented them in collective
bargaining.” Under state law, SEIU negotiated with the state for the collection

‘The facts alleged in plaintiffs’ FAC must be accepted as true in
considering defendant SEIU’s motion to dismiss. See Dieffenbach v. Dept. of
Revenue, 490 Fed.Appx. 433, 435 (3d Cir. 2012); Evancho v. Evans, 423
F.3d 347, 350 (3d Cir. 2005).
Also, since the legal standard to state a claim under §1983 is correctly
stated in the briefs of the parties, the court will not repeat it herein. See a/so
Kneipp v. Tedder, 95 F.3d 1199, 1204 (3d Cir. 1996) (To state an actionable
claim under §1983, a plaintiff must prove that someone deprived her of a
constitutional right while acting under the color of state law.).
“SEIU notes that since plaintiffs were public employees employed by
Pennsylvania, they were subject to its “agency-shop statute” [i.e., the fair
share fee law], namely, 71 Pa.Stat.Ann. §575. See also Diamond □□□
Pennsylvania State Education Association, 399 F.Supp.3d 361, 371 (W.D.Pa.
July 8, 2019).
The court also notes that the Public Employee Relations Act (“PERA’”),

of fair share fees from nonmembers, including plaintiffs.
In particular, Article 3, Section 3 of the CBA, which was effective from
July 1, 2016 through June 30, 2019, provided:
The Employer further agrees to deduct a fair share fee from all
compensation paid to all employees in the bargaining unit who
are not members of the Union. Authorization from non-members
to deduct fair share fees shall not be required. The amounts to be
deducted shall be certified to the Employer by the Union and the
aggregate deductions of all employees shall be remitted together
with an itemized statement to the Union by the last day of the
succeeding month after such deductions are made.
Thus, under the CBA, prior to June 27, 2018, all employees in the
collective bargaining units who were represented by SEIU and who were not
union members, such as plaintiffs, were forced to pay “fair-share fees” to
SEIU as a condition of their public employment. Plaintiffs further allege that
before June 27, 2018, government employers covered by the CBA “deducted
fair share fees from Plaintiffs’ and other nonmembers’ wages without their
consent and, ..., transferred those funds to SEIU, which collected those
funds.” Plaintiffs also allege that “[a]s of 2018, agency fees were assessed by
SEIU at 0.85% of an employee’s gross income; union member paid dues of
1.39% of gross income.”
As such, plaintiffs aver that “SEIU should have known that its seizure
of fair share fees from non-consenting employees likely violated the First
43 Pa.Stat.Ann. §§1101.101 et seq., “delineates the [Pennsylvania Labor
Relations Board’s] authority with regard to public employers”, such as the
Commonwealth, but the PERA does not contain any provision that gives the
PLRB authority to enforce 71 Pa.Stat.Ann. §575. Id. at 382 (citation omitted).
3
Amendment.”
Plaintiffs also seek to bring this case as a class action under
Fed.R.Civ.P. 23(b)(3) for themselves and for all others similarly situated. They
define the proposed class as “all current and former employees from whom
SEIU collected fair share fees pursuant to its collective bargaining agreement
with the Commonwealth of Pennsylvania.”
Plaintiffs raise one claim in their FAC, namely, a First Amendment claim.
Specifically, plaintiffs allege that “SEIU violated [their] and class members’

First Amendment rights to free speech and association, as secured against
state infringement by the Fourteenth Amendment to the United States
Constitution and 42 U.S.C. §1983, by requiring the payment of fair share fees
as a condition of employment and by collecting such fees.”
As relief, plaintiffs request declaratory judgment, pursuant to 28 U.S.C.
§2201(a), “declaring that SEIU violated Plaintiffs’ and class members’
constitutional rights by compelling them to pay fair share fees as a condition
of their employment and by collecting fair-share fees from them without
consent.” Additionally, plaintiffs seek monetary damages “in the full amount
of fair share fees and assessments seized from their wages”, as well as costs
and attorneys’ fees under 42 U.S.C. §1988.

Plaintiffs are proceeding on her FAC filed on October 28, 2019. (Doc.
19). On November 5, 2019, SEIU filed its motion to dismiss plaintiffs’ FAC,
(Doc. 25), and its brief in support, (Doc. 26). On November 19, 2019, plaintiffs
filed their brief in opposition. (Doc. 31). SEIU filed its reply brief on December
4
3, 2019. (Doc. 32).
The court has jurisdiction over this case pursuant to 28 U.S.C. §1331
and 28 U.S.C. §1343(a) because plaintiffs aver a violation of their rights under
the U.S. Constitution. Venue is appropriate in this court since the parties are
located in this district and the alleged constitutional violations occurred in this
district. See 28 U.S.C. 81391.

ll. DISCUSSION
Plaintiffs instituted this case after the Supreme Court decided Janus.°
Plaintiffs are state employees who, before Janus, were required to pay
fair-share fees to SEIU for collective bargaining representation.’ Specifically,
the CBA contained a fair share fee provision which required plaintiffs to pay
fair-fair share fees to SEIU. However, after the Janus decision SEIU stopped
receiving fair-share fees from non-members, including plaintiffs. In this action,
plaintiffs seek SEIU to repay themselves, as well as a putative class of all
non-union state employees, all the fair-share fees that the union received prior
to Janus.
As a backdrop, prior to Janus, unions representing government
employees could use “agency shop” clauses in collective bargaining

‘Janus _v. American Federation of State, County, and Municipal
Employees, Council 31, — U.S. —, 138 S. Ct. 2448 (2018).
“Fair share fees are charges non-union member employees had to pay
unions prior to Janus to finance the union’s collective bargaining activities.
See Diamond, 399 F.Supp.3d at 370.

agreements “which required every employee represented by a union, even
those who declined to become union members for political or religious
reasons, to pay union dues.” Diamond, 399 F.Supp.3d at 370-71. In Abood
v. Detroit Board of Education, 431 U.S. 209, 97 S.Ct. 1782 (1977), the
Supreme Court “held that the charges were constitutional to the extent they
were used to finance the union’s collective-bargaining,
contract-administration, and grievance activities.” Id. at 370. “[T]he Court [in
Abood] also concluded that the agency-shop clause and fees were

unconstitutional insofar as the clause compelled non-member teachers to pay
fees to the union that supported the union’s political activities.” Id.
In accordance with Abood, Pennsylvania enacted its own
agency-shop statute for public employees in 1988, 71 Pa. Stat.
§575. According to Section 575, if mandated by the provisions of
a collective-bargaining agreement, non-members of
public-employee unions must pay fair-share fees to the unions. Id.
§575(b). These fees consist of the regular union-membership
dues less “the cost for the previous fiscal year of [the unions’]
activities or undertakings which were not reasonably employed to
implement or effectuate the duties of the employee organization
as exclusive representative.” Id. §575(a).
Id. at 371.
Thus, prior to Janus, Pennsylvania law expressly allowed a labor union
which was the representative of a bargaining unit of public employees to
collect fair share fees from the employees who were members of the
bargaining unit but who did not join the union, as a condition of their
employment. See 71 P.S.A. §575; 43 P.S.A. §1102.3. Further, based on
Abood, “the general propriety of the fair-share fees permitted under Section
6
575 withstood constitutional scrutiny for many years.” Diamond, 399
F.Supp.3d at 370. /d. (string citations omitted).
In Janus, the Supreme Court overruled Abood, and held that “a state
law requiring non-union-member public employees to pay fees to the union
to compensate the union for costs incurred in the collective-bargaining
process’ was unconstitutional. /d. at 372. Thus, the Court in Janus, 138 S. Ct.
at 2486, held that “States and public-sector unions may no longer extract
agency fees from nonconsenting employees.” /d. Further, the Court held that
“[nJeither an agency fee nor any other payment to the union may be deducted
from a non[-]member’s wages, nor may any other attempt be made to collect
such a payment, unless the employee affirmatively consents to pay.” /d. See
also Babb v. California Teachers Association, 378 F.Supp.3d 857, 867
(C.D.Ca. 2019) (In Janus, the Supreme Court “overruled Abood [ ] and its
progeny, holding that no form of payment to a union, including agency fees,
can be deducted or attempted to be collected from an employee without the
employee's affirmative consent.”) (citing Janus, 138 S.Ct. at 2486).
Additionally, the Supreme Courtin Janus, 138 S.Ct. at 2459, 2486, held
that it was a violation of the First Amendment for public sector unions to
require non-members to pay fair share fees as a condition of public
employment. Following Janus, Pennsylvania’s statute allowing the collection
of “fair share” fees from non-members by unions is no longer enforceable.
See Hartnett v. Pennsylvania State Education Association, 390 F.Supp.3d
600 (M.D.Pa. May 17, 2019). In Diamond, 399 F.Supp.3d at 385, the court

held that the issue of “whether Union Defendants could constitutionally collect
fair-share fees from Plaintiffs pursuant to Section 575” “was mooted by the
intervening Janus decision, which held that fair-share fees are
unconstitutional.”
Plaintiffs essentially argue that they suffered injury from the pre-Janus
agency-shop arrangements because they were forced to pay SEIU fair-share
fees as a condition of their employment with the state even though they
declined union membership. They basically contend that their constitutional

right to withhold money from the union was violated and that this inflicted an
injury upon them that can be redressed under §1983 by an award of money
damages for the violation of their First Amendment rights to free speech and
association by forcing them to pay SEIU fair-share fees as a condition of their
employment.
Plaintiffs strenuously assert that the good faith defense should not apply
to their claim for damages under §1983 since they contend it is contrary to the
statute and is incompatible with the statutory basis for qualified immunity.
SEIU contends that it is entitled to assert a good faith defense to
plaintiffs’ §1983 claim seeking retrospective monetary relief for their payments
of the fair-share fees based on “Pennsylvania statute and then-controlling and

directly on-point United States Supreme Court precedent that expressly
authorized fair-share fees.”5 There is no dispute that before Janus the

5In their FAC, plaintiffs allege that SEIU “acted under color of state law
and in concert with [Pennsylvania] when it compelled [them] to pay fair share
8
collection of fair-share fees by SEIU was permitted by Pennsylvania law as
well as by the Supreme Court which repeatedly held that fair-share fees were
constitutional and that public employees who were non-union members could
be compelled to pay such fees that financed the union’s collective bargaining
activities. Abood, 431 U.S. at 225. Thus, requiring non-union member public
employees to pay fair-share fees as a condition of their public employment
was undoubtedly deemed constitutional in Abood, 431 U.S. at 232. As such,
SEIU contends that since it acted “in good-faith reliance on presumptively
valid state laws [in collecting pre-Janus fair-share fees], [it] ha[s] a complete
defense to §1983 liability” and cannot be held retrospectively liable to plaintiffs
in this case.
SEIU points out that “[n]ineteen district courts, including this Court, and

fees.” Although SEIU does not argue in this case that it was not acting under
“color of state law’, since plaintiffs are proceeding under §1983, SEIU must
be considered a state actor. In Oliver v. Service Employees International
Union Local 668, — F.Supp.3d —, 2019 WL 5964778, *4-5 (E.D.Pa. Nov. 12,
2019), the court found that SEIU Local 668 is not a “state actor” for the
purposes of §1983 since it “is not an actor controlled by the state, is not
performing a function delegated by the state, and is not entwined with
government policies or management.” However, in Janus v. AFSCME, 942
F.3d 352, 2019 WL 5704367 (7" Cir. Nov. 5, 2019), the Seventh Circuit found
that union’s conduct amounted to state action and union was a proper
defendant under §1983 since “[the union] was a joint participant with the state
in the agency-fee arrangement”, and the state human resources department
“deducted fair-share fees from the employees’ paychecks and transferred that
money to the union.” Also, in LaSpina v. SEIU Pennsylvania State Counsel,
2019 WL 4750423 (M.D.Pa. Sept. 30, 2019), this court found that the plaintiff
sufficiently alleged that SEIU was a state actor. (citing Lugar v. Edmondson
Oil Co., Inc., 457 U.S. 922, 942 n.23, 102 S.Ct. 2744 (1982) (“the Supreme
Court held that private parties using a process established by state statute
can be considered state actors for purposes of §1983.”)). As such, the court
finds that for purposes of the instant motion SEIU is a state actor.

the Seventh Circuit have already rejected the same §1983 claim Plaintiffs
bring here” based on the good-faith defense.® Despite plaintiffs’ arguments in
their brief in opposition as to why the good faith defense should not bar their
suit for damages under §1983, the court finds the many cases to which SEIU
cites persuasive and concurs with their conclusion that the good faith defense
shields the union from liability with respect to plaintiffs’ post-Janus claims for
damages under §1983.
In fact, this court noted in LaSpina, 2019 WL 4750423, at *6 n.7’:
[A]lthough “statutory and contractual provisions authorizing
fair-share requirements are no longer enforceable after Janus’,
see Diamond, [399 F.Supp.3d 361] 2019 WL 2929875, at *14, the
good-faith defense would apply to relieve SPL and [SEIU] from
liability under §1983 since they reasonably relied on the
constitutionality of Pennsylvania’s fair-share fee law, §575, and
the Supreme Court’s decision in Abood which permitted such
fees. See id. at *25-29 (citing, in part, Akers, 376 F.Supp.3d at
571-72 (“explaining that the plaintiffs could assert a good-faith
defense because they complied with and _ relied on
presumptively-valid state law and controlling Supreme Court
precedent”; Crockett v. NEA-Alaska, 367 F. Supp. 3d 996, 1006
(D. Alaska) (“discussing the inequity of holding the union
defendants liable for pre-Janus fair-share fees when they
collected the fees in accordance with state law and then-binding
Supreme Court precedent”); Akers v. Maryland State Educ.
Assoc., 376 F.Supp. 3d 563 (D.Md. 2019).
As this court noted in LaSpina, and based on the numerous cases cited

°Since SEIU correctly cites to the cases in its brief, (Doc. 26 at 11 n. 4),
which have held that the good-faith defense precluded recovery in §1983
actions similar to the instant case, the court does not re-cite all of the
applicable cases. See a/so note 9 below.
‘The plaintiff in LaSpina filed an appeal to the Third Circuit which is
currently pending.
10

herein, the court finds that SEIU can raise the good-faith defense with respect
to plaintiffs’ First Amendment claim under §1983 for the repayment of the
fair-share fees that they paid the union. As SEIU states, “Plaintiffs’ §1983
claim seeks a retrospective refund of fair-share fees collected before Janus
issued, at a time when Pennsylvania statutes and controlling U.S. Supreme
Court precedent expressly allowed the collection of such fees.” (Doc. 26 at
14-15) (citing Otto v. Pennsylvania State Educ. Association-NEA, 330 F.3d
125 (3d Cir. 2003) (“upholding statutory fair-share fee system and collective

bargaining agreement incorporating fair share fee requirement”)).
In Wyatt v. Cole, 504 U.S. 158, 159, 168, 112 S.Ct. 1827 (1992), “[t]he
Court determined that private individuals threatened with liability under §1983
cannot take advantage of the qualified immunity that protects government
officials”, but “explained that ‘principles of equality and fairness may suggest
... that private citizens who rely unsuspectingly on state laws they did not
create and may have no reason to believe are invalid should have some
protection from liability [under §1983], as do their government counterparts.’”
Diamond, 399 F.Supp.3d at 395. Subsequently, “the Third Circuit adopted the
good-faith defense for private parties [facing §1983 liability] in Jordan v. Fox,
Rothschild, O'Brien & Frankel, 20 F.3d 1250 (3d Cir. 1994). Id. at 396. In

Jordan, 20 F.3d at 1276, the Third Circuit held that “[p]rivate defendants
should not be held liable under §1983 absent a showing of malice and
evidence that they either knew or should have known of the statute’s
constitutional infirmity.” Id. (citation omitted). Thus, despite plaintiffs’
11
contentions, the court finds that SEIU can assert a good-faith defense in this
case in which plaintiffs seek to impose liability against it for violations of their
First Amendment rights under §1983.
After examining the good-faith defense in detail, the court in Diamond
then concluded that “it was objectively reasonable for Union Defendants to
rely on Section 575 and Abood [when collecting fair-share fees from Plaintiffs]
before the Supreme Court's decision in Janus”, id. at 398, and, thus found
that “the good-faith defense applies to Plaintiffs’ claims [under §1983] for
repayment of previously paid fair-share fees as a matter of law.” /d. at 398-

®The court notes that plaintiffs also address the argument raised in
some cases that, based on Wyatt, “the good-faith defense only applies if the
most analogous common-law tort would have conferred similar immunities
when §1983 was enacted.” Diamond, 399 F.Supp. 3d at 397-98. Plaintiffs
contend that while the good faith defense has been held to “defeat the malice
and probable cause elements of a constitutional claim arising from an abuse
of judicial process”, “[the] cases did not recognize an across-the-board good
faith defense—i.e., that any defendant that relies on a statute is exempt from
paying damages under Section 1983.” Plaintiffs state that since malice and
probable cause are not elements of or defenses to their claim, i.e., “a First
Amendment compelled speech violation’, “it is irrelevant which common law
tort may be most analogous to such [a] claim[].” As such, plaintiffs contend
that their First Amendment compelled-speech claim has no common law
analogue”, and that SEIU should not be allowed to assert the good faith
defense to their claim.
Since this court, as did the court in Diamond, 399 F.Supp. 3d at 398,
“agrees with the opinions of various district courts that have determined —
when presented with indistinguishable facts — that the applicability of the
good-faith defense does not require analyzing the most analogous
common-law tort’, it does not conduct such an analysis herein. (string
citations omitted). In fact, “when the Third Circuit adopted the good-faith
defense in Jordan, the Third Circuit did not indicate whether the application
of the good-faith defense depends on an analogous common-law tort’, “[a]nd
district court cases applying Jordan have not relied on common-law-tort
12

More recently, in Oliver v. Service Employees International Union Local
668, — F.Supp.3d —, 2019 WL 5964778 (E.D.Pa. Nov. 12, 2019), the court
considered a case similar to the present case. In Oliver, plaintiff was an
employee of the Pennsylvania Department of Human Services working as an
Income Maintenance Caseworker and she was represented in collective
bargaining by SEIU Local 668. When plaintiff's was hired, there existed a CBA
between Local 668 and the Commonwealth. Plaintiff was told that she could
“either enroll in Local 668 as a member and have full membership dues

deducted regularly from her pay, or decline membership and contribute a
reduced amount in the form of agency fees.” Id. at *2. Given this choice,
plaintiff joined as a member in Local 668 and dues were deducted from her
pay. After Janus, plaintiff Oliver resigned from Local 668 and requested that
deductions from her pay for union dues cease. The deductions were then
stopped. Plaintiff then filed an action for damages against SEIU under §1983
for the dues she paid to SEIU from the beginning of her employment through
her resignation. Plaintiff also sought “a declaratory judgment that certain
provisions of Pennsylvania’s Public Employee Relations Act (PERA) are
unconstitutional as applied to her.” Id. at *1.
The court in Oliver, id. at *4, found that “Local 668 is not a ‘state actor’

for the purposes of §1983”, and that “[e]ven if there were sufficient state
action to permit a §1983 suit against the Union to proceed, Local 668 would
nonetheless prevail based upon its good-faith belief that it was complying with
analogs.” Id. (string citations omitted).
13
statutory and constitutional law prior to Janus.” /d. at *7. The court indicated
that “[nJumerous federal courts have held that good-faith reliance on prior
precedent defeats refund claims brought in the aftermath of Janus.” /d.°
The court in Oliver, id. at *7, then explained that “[t]he Third Circuit, ...,
has found that ‘private defendants should not be held liable under §1983
absent a showing of malice and evidence that they either knew or should
have known of the statute’s constitutional infirmity.” (citing Jordan, 20 F.3d
at 1274 n. 29). Thus, the court in Oliver, id., concluded that since “Plaintiff
would need to prove that [SEIU] had a ‘subjective’ understanding that it was
violating her rights or displayed ‘gross negligence’ in maintaining a belief that

*The court in Oliver, 2019 WL 5964778, *7 n. 13, cited to the following
cases to support its finding that the good faith defense precluded plaintiff's
§1983 case against SEIU:
Janus v. AFSCME, 942 F.3d 352 (7" Cir. Nov. 5, 2019); Danielson v.
AFSCME Council 28, 340 F. Supp. 3d 1083, 1086 (W.D. Wash. 2018);
Carey v. Inslee, 364 F. Supp. 3d 1220, 1232 (W.D. Wash. 2019); Cook
v. Brown, 364 F. Supp. 3d 1184, 1193 (D. Or. 2019); Crockett
NEA-Alaska, 367 F. Supp. 3d 996, 1006 (D. Alaska 2019); Hough v.
SEIU Local 521, 2019 WL 1274528 at *1 (N.D. Cal. Mar. 20, 2019),
amended, 2019 WL 1785414 (N.D. Cal. Apr. 16, 2019); Lee v. Ohio
Educ. Ass’n, 366 F. Supp. 3d 980, 981 (N.D. Ohio 2019); Mooney v.
Illinois Educ. Ass’n, 372 F. Supp. 3d 690, 706 (C.D. Ill. 2019);
Bermudez v. SEIU Local 521, 2019 WL 1615414 at *1 (N.D. Cal. Apr.
16, 2019); Akers v. Maryland Educ. Ass’n, 376 F. Supp. 3d 563, 572 (D.
Md. 2019); Wholean v. CSEA SEIU Local 2001, 2019 WL 1873021 at
*3 (D. Conn. Apr. 26, 2019); Babb, 378 F. Supp. 3d at 870; Hernandez
v. AFSCME Cal., 386 F. Supp. 3d 1300, 1304 (E.D. Cal. 2019) (since
unions had authorization from the Supreme Court and state statute, the
unions that followed the previously valid law were “entitled to the
good-faith defense as a matter of law.”); Diamond v. Pa. State Educ.
Ass'n, 399 F.Supp.3d 361, ——, 2019 WL 2929875 at *29 (W.D. Pa.
2019); Ogle v. Ohio Civil Svc. Employees Ass’n, AFSCME, Local 11,
397 F. Supp. 3d 1076, 1087-88 (S.D. Ohio 2019).
14

its conduct was lawful’, “Plaintiff will not be able to do so” because “[t]he
CBA’s agency shop provisions were lawful under PERA, and ..., were
sanctioned by the Supreme Court in Abood.” (internal citations omitted). The
court also noted that since the CBA’s agency shop provisions “had been
considered and upheld by the Supreme Court multiple times after Abood,
including most recently in Harris v. Quinn, 573 U.S. 616, 134 S.Ct. 2618
(2014)”, and since “Janus was decided by a five-to-four majority, with a
powerful dissent grounded in the doctrine of stare decisis’, “it would be
unreasonable to hold that [SEIU] should have known of the constitutional
infirmity of agency shop provisions.”
In the instant case, although plaintiffs allege in their FAC that “SEIU
should have known that its seizure of fair share fees from non-consenting
employees likely violated the First Amendment”, (Doc. 19 at 413), pre-Janus,
the law was clear that “[t]he CBA’s agency shop provisions were lawful under
PERA’, and were authorized by Abood. Oliver, id. at *7. As such, under the
Third Circuit’s standard, plaintiffs cannot defeat SEIU’s good faith defense in
this case.
In fact, plaintiffs recognize that very recently the Seventh Circuit in
Janus v. AFSCME, 942 F.3d 352, 2019 WL 5704367 (7" Cir. Nov. 5, 2019)
(“Janus III”), issued the first appellate opinion on point with their case, i.e., to
decide “whether a union may raise [the good faith defense] against its liability
for the fair-share fees it collected before Janus [].” In Janus III, plaintiff was
an Illinois State employee who was not a member of the union and he filed a

15

§1983 action, after the Supreme Court decided his previous case in Janus,
against the union seeking to recover the fair-share fees he was required to
pay to the union. The Seventh Circuit found that the good faith defense
precluded the state employee’s claim for monetary damages for alleged past
violations of his First Amendment rights. The Seventh Circuit stated that
“every federal appellate court to have decided the question has held that,
while a private party acting under color of state law does not enjoy qualified
immunity from suit, it is entitled to raise a good-faith defense to liability under

section 1983.” Janus III, 942 F.3d at 362 (citations omitted). The Seventh
Circuit included the Third Circuit’s decision in Jordan, 20 F.3d at 1275-78, as
a case that supported the union’s ability to assert a good-faith defense to
§1983 liability.
After the Seventh Circuit “recogniz[ed] that, under appropriate
circumstances, a private party that acts under color of law for purposes of
section 1983 may defend on the ground that it proceeded in good faith”, the
court then considered the question of whether the good faith defense was
available to the union with respect to plaintiff’s First Amendment claim seeking
to hold it liable for the fair-share fees the union collected from him before
Janus. The Seventh Circuit recognized “a good-faith defense in section 1983

actions when the defendant reasonably relies on established law.”Janus III,
942 F.3d at 366. The Court then held that although “the good-faith defense
to section 1983 liability is narrow”, “[u]ntil [the Supreme Court in Janus] said
otherwise, [the union] had a legal right to receive and spend fair-share fees
16
collected from nonmembers as long as it complied with state law and the
Abood line of cases.” /d. The Court also found that “the union did not
demonstrate bad faith when it followed these rules.” /d.
This court finds the Seventh Circuit's decision in Janus III compelling
and concurs with it. As such, since SEIU “relied substantially and in good faith
on both a [PA] state statute and unambiguous Supreme Court precedent
[Abood] validating that statute”, id. at 367(emphasis original), SEIU can assert
the good faith defense to plaintiffs’ First Amendment claim seeking to hold it
liable under §1983.
Plaintiffs also argue that the Supreme Court’s decision in Janus is
retroactive under Harper v. Va. Dep’t of Taxation, 509 U.S. 86, 97 (1993), and
Reynoldsville Casket Co. v. Hyde, 514 U.S. 749, 752 (1995), and that the
good faith defense is incompatible with the retroactivity principles under
Reynoldsville Casket. Plaintiffs further contend that even if SEIU could raise
the good faith defense to their claims under §1983, SEIU knew or should have
known, based on Harper, that a later Supreme Court decision holding the
collection of agency fees to be unconstitutional would be retroactive and thus,
SEIU had no reasonable basis for believing it could keep their money if the
Supreme Court held those fees to be unconstitutional.
No doubt that “when the Supreme Court applies a new rule of federal
law to the parties before it, other courts must apply that decision
retroactively.” Diamond 399 F.Supp. 3d at 395 (citing Harper v. Va. Dep’t of
Taxation, 509 U.S. 86, 90, 97, 113 S.Ct. 2510 (1993)). In Diamond, id. at 396,

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the court found that “Harper's retroactivity rule applies to Janus” since “Janus
overruled ‘clear past precedent’ (Abood), announced a rule regarding the
unconstitutionality of fair-share fees, and applied that rule to the case by
reversing the Seventh Circuit’s dismissal of the plaintiffs’ complaint.” (citing
Janus, 138 S.Ct. at 2460, 2462). The court in Diamond, jd. at 396, then
concluded that since “a court may find ‘a previously existing, independent
legal basis (having nothing to do with retroactivity) for denying [retroactive]
relief’, “there is an independent legal basis in this case for otherwise denying
retroactive relief: the good-faith defense available to private parties [i.e., the
state teacher's union] who are sued under §1983.” (citing Jordan, 20 F.3d at
1276).
In the instant case, the court concurs with the rationale and conclusion
in Diamond, id. at 395-96, and finds that although “Harper’s retroactivity rule
applies to Janus”, “the good-faith defense to §1983 liability for damages
provides an independent legal basis” for precluding plaintiffs’ claim for
retroactive relief from SEIU.
Moreover, in Janus III, 942 F.3d at 359, the Seventh Circuit considered
the retroactivity argument and pointed out that if Janus is not retroactive, “that
is the end of the line for [plaintiff], because the union’s collection of fair-share
fees was expressly permitted by state law and Supreme Court precedent from
the time he started his covered work until the Court’s decision [in Janus].” In
Janus Ill, id., the Seventh Circuit also stated that “the Supreme Court’s
opinion [in Janus] did not address retroactivity in so many words.” The

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Seventh Circuit further noted that in decisions after Reynoldsville Casket and
Harper, the Supreme Court “has stated that the ‘general practice is to apply
the rule of law we announce in a case to the parties before us ... even when
we overrule a case.” /d. at 360 (citing Agostini v. Felton, 521 U.S. 203, 237,
117S.Ct. 1997 (1997). The Seventh Circuit, also recognized that “retroactivity
and remedy are distinct questions” and, that “the Supreme Court has
acknowledged that the retroactive application of a new rule of law does not
‘deprive[ ] respondents of their opportunity to raise ... reliance interests
entitled to consideration in determining the nature of the remedy that must be
provided.” /d. at 362 (quoting James B. Beam Distilling Co. v. Georgia, 501
U.S. 529, 544, 111 S.Ct. 2439 (1991)).
In any event, since it is not clear if the Supreme Court's decision in
Janus is to be applied retroactively, as in Janus III, the court finds that the
retroactivity issue does not need to be decided in this case. Rather, similar to
Janus III, the court has addressed the “broader question whether [plaintiffs]
[are] entitled to the remedy [they] seek[]”, and whether the union can assert
the good-faith defense to §1983 liability in this case. /d. at 360-61.
Another recent case also supports SEIU’s assertion of the good-faith
defense to plaintiffs’ claims under §1983. In Hamidi v. Service Employees
International Union Local 1000, 2019 WL 5536324, *2 (E.D.Cal. Oct. 25,
2019), the court stated that “[t]he Supreme Court in Janus ‘itself did not
specify whether the plaintiff was entitled to retrospective monetary relief for
conduct the Supreme Court had authorized for the previous forty years.”

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(citing Cooley v. California Statewide Law Enf't Ass'n, 385 F. Supp. 3d 1077,
1081 (E.D.Cal. 2019) (citing Janus, 138 S. Ct. at 2486)). However, the court
in Hamidi noted that “the controlling law in the Ninth Circuit”, similar to the
controlling law in the Third Circuit, see Jordan, 20 F.3d at 1275-78,
“recognizes a good faith defense in shielding private defendants from liability
in §1983 actions.” /d. The court in Hamidi, id. at *3, then concurred with “every
district court to consider whether unions that collected agency fees prior to
Janus have a good-faith defense to §1983 liability [that] have answered in the
affirmative’, and stated the standard was, “in the agency fee context, a
union’s compliance with then-existing law indeed suffices to find good faith.”
Thus, the court held that since the union’s “compliance with what was then
the law is sufficient for a finding of good faith’, the union could avail itself of
the good faith defense to §1983 liability for fair share fees collected before the
Supreme Court’s decision in Janus. /d. at *4.
In short, this court concurs with the numerous cases which have found
that unions, such as SEIU, that collected fair-share fees from nonmembers
prior to Janus, and pursuant to state law and Abood, can assert the good-faith
defense to §1983 liability for the First Amendment claims raised by plaintiffs.
Thus, the court will grant SEIU’s motion and dismiss with prejudice
plaintiffs’ First Amendment claims seeking to hold the union retrospectively
liable under §1983. Based on the foregoing, the court finds futility in allowing
plaintiffs leave to file a second amended complaint. See Janus, Ill, supra;
Diamond, supra; Babb, 378 F.Supp. 3d at 872 (“[E]very district court to

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consider whether unions that collected agency fees prior to Janus have a
good-faith defense to §1983 liability [has] answered in the affirmative.”)
(citations omitted).
Plaintiffs next contend that even if SEIU acted in good faith in receiving
fair-share fees, it could not have a good faith belief that if Abood was
overruled, it could keep the fair-share fees that it previously collected. Thus,
plaintiffs assert that they have an equitable claim for the return of the fair-
share fees SEIU collected from them before Janus. SEIU counters that
plaintiffs have no equitable claim for the return of the fees they paid prior to
Janus.
Last month, the Seventh Circuit in Mooney v. Illinois Education
Association, 942 F.3d 368, 370-71 (7" Cir. 2019), considered a similar
contention and stated:
[Plaintiff] believes that even if she concedes that a good-faith
defense protects the union against a damages award, an
equitable demand for restitution cannot be defeated on good-faith
grounds. She argues that there is nothing unfair about requiring
the union to return monies that, according to Janus, should never
have been deducted from her paychecks in the first place. In fact,
she concludes, the union would receive a windfall based on its
violations of her constitutional rights if no restitution were ordered.
In explaining that although §1983 allows for remedies at law or in equity
and that “the district court has discretion to tailor an appropriate remedy for
the constitutional violation”, the Seventh Circuit in Mooney, id. at 370, found
that plaintiff's claim was a legal claim and not an equitable claim. In Mooney,
id., the union argued that plaintiff's suit was “one for damages flowing from a

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First Amendment violation”, and that “[t]he gravamen of [plaintiff’s] complaint
is that her First Amendment rights were violated by the fair-share requirement
because she was compelled to furnish financial support to union activities with
which she disagreed.” The Seventh Circuit in Mooney agreed with the
analysis of the district court which found that “Plaintiff’s claim lies in law rather
than equity, and there is consequently no reason to consider whether the
good-faith defense applies where the claim is for equitable restitution.” Id. The
Seventh Circuit then stated that since plaintiff failed to “point to an identifiable

fund and show that her fees specifically are still in the union’s possession”,
‘[h]er claim is against the general assets of the union, held in its treasury, and
can only be characterized as legal.” Id. at 371.
SEIU points out that in the present case, “plaintiffs do not have a viable
claim for equitable relief because fair-share fees already paid for collective
bargaining representation that Local 668 provided to the entire unit.” (citing
Babb v. California Teachers Ass’n, 378 F. Supp. 3d 857 (C.D.Cal. 2019).
SEIU also states that plaintiffs have already received benefits from their
collective bargaining representation which was paid for by the fair-share fees
they paid and that “it would be inequitable for force [it] to repay plaintiffs’
agency fees.” (quoting Babb, 378 F.Supp.3d at 876).

As in Mooney, 942 F.3d at 371, the plaintiffs’ claim in this case is one
for damages and is “against the general assets of the union, held in its
treasury”, and thus, “can only be characterized as legal.” (citing Montanile v.
Bd. of Trustees of Nat. Elevator Indust. Health Benefit Plan, ––– U.S. ––––,
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136 S. Ct. 651, 658 (2016) (“Where a plaintiff seeks ‘recovery from the
beneficiaries’ assets generally’ because her specific property has dissipated
or is otherwise no longer traceable, the claim ‘is a /ega/ remedy, not an
equitable one.””) (emphasis in original) (internal quotation marks omitted)).
Finally, in Diamond, 399 F.Supp. 3d at 385, 389, the court also held
that plaintiffs’ claims for declarative and injunctive relief with respect to fair-
share fees were moot based on the Janus decision and union defendants’
compliance with it. (citing collection of cases). See a/so Hartnett, 390
F.Supp.3d at 600-02 (court found claims for declaratory and injunctive relief
moot post-Janus since “[p]laintiffs face no realistic possibility that they will be
subject to the unlawful collection of ‘fair share’ fees”). Declaratory judgment
is not meant to adjudicate alleged past unlawful activity. There is no
question that a plaintiff can request declaratory relief to remedy alleged
ongoing violations of her constitutional rights. See Blakeney v. Marsico, 340
Fed.Appx. 778, 780 (3d Cir. 2009)(Third Circuit held that to satisfy the
standing requirement of Article Ill, a party seeking declaratory relief must
allege that there is a substantial likelinood that he will suffer harm in the
future)(citations omitted).
The court concurs with the courts in Diamond and Hartnett, and holds
that our plaintiffs’ claim for declarative judgment is moot based on Janus and,
based on the undisputed fact that SEIU stopped collecting fair-share fees
from state non-union member employees, including plaintiffs, following the
Janus decision. See a/so Oliver, 2019 WL 5964778, *7 (holding “Plaintiff's
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claims for declaratory and injunctive relief regarding the application of 43 P.S.
§§1101.301(18), 1101.401, and 1101.705 suffers from lack of standing and
mootness.”).
Also, as in Diamond, 399 F.Supp. 3d at 391-93, the court find that the
voluntary-cessation exception to the mootness doctrine does not apply in this
case since “[t]he circumstances of this case make it clear that the

undisputedly wrongful behavior — the collection of fair-share fees — is not
reasonably likely to recur [after Janus’s changing of the law and the reason
that SEIU stopped collecting fair-share fees from public employees in
Pennsylvania].” Indeed, “[c]omplying with a Supreme Court decision cannot
be considered ‘voluntary cessation.’” Id. (citing Lamberty v. Conn. State Police
Union, 2018 WL 5115559, at *9 (D.Conn. Oct. 19, 2018) (“explaining that
there was ‘nothing voluntary’ about the union’s decision to comply with Janus,
as Janus ‘announced a broad rule invalidating every state law permitting

agency fees to be withheld’”). As such, “compliance with an intervening
Supreme Court decision does not implicate the voluntary-cessation exception
to the mootness doctrine.” Id., at 392.
Thus, the court will grant SEIU’s motion and dismiss with prejudice
plaintiffs’ request for declaratory judgment under 28 U.S.C. §2201.

III. CONCLUSION
Based on the foregoing reasons, the court will GRANT the Rule 12(b)(6)

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motion to dismiss plaintiffs’ FAC, (Doc. 19), filed by SEIU, (Doc. 25), and
plaintiffs’ First Amendment claims and request for declaratory judgment shall
be DISMISSED WITH PREJUDICE. Further, this case will be CLOSED. An
appropriate order shall issue.

s/ Malachy E. Mannion
MALACHY E. MANNION
United States District Judge
Date: December 10, 2019
19-1367-01.wpd

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10408124. Public record. Not legal advice.