Motion — Local Union 598, Plumbers & Pipefitters Industry Journeymen & Apprentices Training Fund v. J. A. Jones Construction Co.

Supreme Court, US,

FILED

SEP 28 1988

JOSEPH E, SPAMIOL, de |

No. 88-295 CLERK

—_

In the Supreme Court

OF THE

United States

OCTOBER TERM, 1988

LOCAL UNION 598, PLUMBERS & PIPEFITTERS INDUSTRY

JOURNEYMEN & APPRENTICES TRAINING FUND,

Plaintiff-Appellant,

VS.

J.A. JONES CONSTRUCTION COMPANY; BECHTEL POWER

CORPORATION; and JOHNSON CONTROLS, INC.,

Defendants-A ppellees.

BRIEF OF JOHNSON CONTROLS, INC.

IN RESPONSE TO

FOUNDATION FOR FAIR CONTRACTING’S

AMICUS CURIAE BRIEF

CARL E. HUEBER

(Counsel of Record)

JOHN C. BLACK

WINSTON & CASHATT

19th Floor

Seafirst Financial Center

Spokane, Washington 99201

Telephone: (509) 838-6131

Counsel for Johnson Control, Inc.

eal

—

TABLE OF CONTENTS

Page

I iad cecil sk ca biwe ew owen ees ii

I ees a ete eka s been chen dae aan 2

ee ea a NaN aa ds ab akad de heh aca de 2

A. Congressional Intent As It Pertains To

ERISA ts Well Settled ... wn cece cc ees. 2

B. The State Law Directly Regulates The

Terms Of An Employee Benefit Plan ...... 3

TABLE OF AUTHORITIES

Page

Cases:

Arcudi v. Stone & Webster Engineering, 463 U.S.

1220, 108 S. Ct SGB6 CTS scceucvcccsaaseus 3,4

Fort Halifax Packing Co. vs. Coyne, 482 U.S. __,

96 L.Ed.2d 1, @ (QR). ..<cwcuuseeeeeeeeess ae

Shaw v. Delta Airlines, Inc., 463 U.S. 85, 97,

77 L.Ed.2d 490, 501, 103 S. Ct. 2890 (1983) ....4,5

Stone & Webster Engineering Corp. v. lisley,

600 F.2d 323 (2rud Gl. Fe saan cccewerseaees 3,4

STATUTES AND REGULATIONS

Washington Revised Code Chapter 39.12 .......... 3

IN THE SUPREME COURT

OF THE UNITED STATES

October Term, 1988

LOCAL UNION 598,

PLUMBERS & PIPEFITTERS INDUSTRY

JOURNEYMEN & APPRENTICES TRAINING FUND,

Plaintiff-Appellant,

vs.

J.A. JONES CONSTRUCTION COMPANY;

BECHTEL POWER CORPORATION AND

JOHNSON CONTROLS, INC.

Defendants-Appellees.

BRIEF OF JOHNSON CONTROLS, INC.,

IN RESPONSE TO FOUNDATION FOR FAIR

CONTRACTING’S AMICUS CURIAE BRIEF

Appellee Johnson Controls, Inc., submits this brief in

response to the Amicus Curiae Brief of the Foundation

for Fair Contracting. This brief is submitted pursuant to

Rule 33 of the Rules of the Supreme Court.

2

STATEMENT OF FACTS

Johnson Controls, like Bechtel and J.A. Jones

Construction Co., is a member of the National

Constructors Association. To insure uniform obliga-

tions upon national contractors, the National

Constructors Association entered into a national

collective bargaining agreement with the United

Association of Journeymen and Apprentices of the

Plumbing and Pipefitting Industry. The national agree-

ment requires contractors to make contributions to the

National Fund for apprenticeship training. The national

fund is an “employee welfare benefit plan” within the

definition of ERISA. In direct conflict with the

negotiated contribution requirements, Washington's

prevailing wage statute requires contributions in

excess of the national levels.

ARGUMENT

Contrary to the appellant's Jurisdictional Statement,

Congressional intent as it pertains to ERISA has been

thoroughly defined. Likewise, the issue before this

Court has also been addressed. The State’s attempt to

regulate contribution levels to an “ERISA” employee

benefit plan “relate to” the employee benefit plan.

Consequently, the issues raised by the appellant are

inconsequential and do not require plenary considera-

tion.

A. Congressional Intent As It Pertains To ERISA Is

Well Settled.

On numerous occasions, this Court has addressed

the Congressional intent behind ERISA. ERISA was

intended to preempt the field of employee benefit

plans to eliminate the threat of conflicting or

inconsistent state and local regulations. Fort Halifax

3

Packing Co. vs. Coyne, 482 U.S. __. 96 L.Ed.2d 1, 9

(1987).

Because the Congressiona| intent behind ERISA is

clear, it is unnecessary for this Court to delve any

further. State regulations which mandate specific

contributions to ERISA employee benefit plans threaten

to create inconsistent regulations. In fact, here, the

subject statute actually creates a continuing obligation

different from the obligations negotiated at a national

level. The state statute at issue in this case is the exact

type of regulation Congress intended to preempt. Since

the Court has thoroughly defined the Congressional

intent of ERISA’s preemption provision, plenary

consideration is not required.

B. The State Law Directly Regulates The Terms Of

An Employee Benefit Plan.

Here, Washington Revised Code Chapter 39.12

“relates to” an ERISA plan. The law mandates a

continuing obligation of contributions to an “ERISA”

plan in direct conflict with the employer's negotiated

obligations. Contributions are an inextricable part of a

benefit plan. Consequently, plenary consideration is

unnecessary where, as here, the State's regulation

unquestionably purports to regulate a condition of an

ERISA plan.

Here, the employers have undertaken a contractual

commitment to systematically pay contributions

includi.ig the attendant obligations which go with

those contributions. The state law directly impacts the

contractor's obligations. The case of Stone & Webster

Engineering Corp. v. Ilsley, 690 F.2d 323 (2nd Cir.

1982), affd mem. sub. nom. Arcudi v. Stone & Webster

Engineering, 463 U.S. 1220 (1983) speaks directly to

the issue at hand. Just as RCW 39.12 regulates the

4

extent of contributions, the statute in Stone & Webster

regulated the duration of contributions to an ERISA

plan. Like the statute here, the statute in Stone &

— the cost of which is to be borne by the employer

—to a private employee benefit plan.” Stone & Webster

Engineering Corp., 690 F.2d 323, 329 (2nd Cir 1982),

affd 463 U.S. 1220, 103 S. Ct. 3564 (1983).

Laws requiring specific contributions to a plan are

no different than laws requiring specific benefits from a

plan. In Fort Halifax Packing, the court stated:

.. . State laws requiring the payment of benefits

also relate to an employee benefit plan if they

attempt to dictate what benefits shall be paid under

a plan. To hold otherwise would create the prospect

that plan administration would be subject to

differing requirements regarding benefit eligibility

and benefit levels — precisely the type of conflict

that ERISA's preemption provision was intended to

prevent.

id., 96 L.Ed.2d at p. 13.

Here, contributions and benefits are inextricably

related. Without contributions, there would be no

benefits. To preempt one without the other would be

senseless.

The fact that ERISA does not speak to specific contri-

butions has no bearing on ERISA’s preemptive reach.

ERISA does not preempt only state laws dealing with

5

the subject matters covered by ERISA — reporting,

disclosure, fiduciary responsibility, and the like. Shaw

v. Delta Airlines, inc., 463 U.S. 85, 97, 77 L_Ed.2d 490,

501, 103 S. Ct. 2890 (1983). The preemptive reach of

ERISA was meant to clear away all state laws bearing

on benefit plans even though many aspects of benefit

plans remain unregulated by ERISA. id.

In summary, state laws regulating continued

contributions to a benefit plan have a direct and

continuing impact on the contractors obligations vis-a-

vis that plan. This Court has thoroughly defined

Congressional intent to preempt such state laws which

purport to regulate a substantive requirement of the

plan. Consequently, the issues raised by the present

appeal are so insubstantial that the Court is requested

to dismiss the present appeal or alternatively affirm the

lower court's ruling.

DATES this 20th day of September, 1988.

Respectfully submitted,

i.

LE HU

(Counsel of Record)

JOHN C. BLACK

WINSTON & CASHATT

Attorneys for Johnson Controls,

Inc.