# Opposition Brief — Freeman v. Duke Power Co.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 2005
- **Citation:** 544 U.S. 968

## Text

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} Supreme Court, U.S
a i |
/ FEB 282005 |
!
j

No. 04-1011 | OFFICE OF THE CLERK
In The
Supreme Court of the Anited States
+

ALBERT L. FREEMAN,

Petitioner,

2
DUKE POWER COMPANY, et al.,

Respondents.

On Petition For A Writ Of Certiorari
To The United States Court Of Appeals
For The Fourtb Circuit

RESPONDENTS’ BRIEF IN OPPOSITION

D. BETH LANGLEY

Counsel of Record
BRIAN S. CLARKE
NEXSEN PRUET ADAMS KLEEMEIER, PLLC
701 Green Valley Road, Suite 100
Greensboro, North Carolina 27408
(336) 373-1500

Counsel for Respondents

COCKLE LAW BRIEF PRINTING CO (800) 225-6964
OR CALL COLLECT (402) 342-2831

QUESTIONS PRESENTED

Did the Fourth Circuit conclude correctly, based
on well-established precedent, that a settlement
agreement entered as a result of a grievance
brought by a union pursuant to the terms of a col-
lective bargaining agreement is a labor “contract”
within the meaning of Section 301 of the Labor
Management Relations Act, 29 U.S.C. § 185(a)
(hereinafter “LMRA Section 301”)?

Did the Fourth Circuit conclude correctly, based
on well-established precedent, that Petitioner Al-
bert L. Freeman’s claims for breach of contract,
wrongful discharge and tortious interference with
contract were completely preempted by LMRA
Section 301?

Did the Fourth Circuit conclude correctly, based
on well-established precedent, that Petitioner Al-
bert L. Freeman’s claims for breach of contract
and wrongful discharge were barred by the six-
month statute of limitations for “hybrid” LMRA
Section 301 claims pursuant to DelCostello v. Int'l
Bhd. of Teamsters, 462 U.S. 151, 158, 103 S.Ct.
2281, 2287 (1983)?

Did the Fourth Circuit conclude correctly, based
on well-established precedent, that Petitioner Al-
bert L. Freeman’s claim for tortious interference
with contract failed to state a claim upon which
relief could be granted under LMRA Section 301?

Did the Fourth Circuit conclude correctly, based
on well-established precedent, that Petitioner Al-
bert L. Freeman’s claim for unfair and deceptive
trade practices failed to state a claim upon which
relief could be granted under North Carolina law?

CORPORATE DISCLOSURE STATEMENT

Respondent “Duke Power Company” is an operating
unit of respondent Duke Energy Corporation, is not a
separate corporate entity and has no stock. Accordingly, no
publicly-held company owns 10% or more of its stock.

Respondent Duke Energy Corporation is a publicly-
held company. Duke Energy Corporation has no parent
company and no publicly-held company owns 10% or more
of its stock.

Respondents Cindy Thaxton and George Kwascha are
individuals.

iil

TABLE OF CONTENTS
Page
QUBSTIONS PRESENTED o000ccccseccscscssrescesscossesssessosess i
CORPORATE DISCLOSURE STATEMENT............... ii
BE PRE hE RID cs scnctasincrnecvecsccccastsncansseasase Vv
STATEMENT OF THE CASE. ..........ccccccscsscssesessosecsosees
REASONS FOR DENYING THE PETITION .............. 5

I. THE DECISION OF THE FOURTH CIRCUIT
DOES NOT CONFLICT WITH ANY DECI-
ESP HEROD GAPRIIEE csinissssnsicciscscatscecssscencsees 5

A. The Decision Of The Fourth Circuit Does
Not Conflict With This Court’s Decision In
INC IIE ccaitadiiauiphanvicesdavdasneneenninacesenns 6

B. The Decision Of The Fourth Circuit Does
Not Conflict With This Court’s Decision In
ee iddeaaanens 8

C. The Decision Of The Fourth Circuit Does
Not Conflict With This Court’s Decision In

PERRIER, TID. Sssscciincesnsnsatvencsesusecsens 9
II. THERE IS NO CIRCUIT SPLIT ON THE
QUESTIONS PRESENTED..................cccceeeeeeees 10

III. THIS CASE DOES NOT PRESENT ANY
QUESTION OF EXCEPTIONAL IMPOR-
TANCE TO LABOR LAW JURISPRUDENCE
WHICH SHOULD BE DECIDED BY THIS
IIT Si Nn oi ssa cinnenndpibintininnciiincimnnnnhiasnnienesssees 12

IV. THERE IS NO INTERNAL CONFLICT WITH
THE CASE LAW OF THE FOURTH CIRCUIT
ON THE QUESTIONS PRESENTED .............. 14

iv

TABLE OF CONTENTS - Continued
Page

V. THERE IS NO COMPELLING REASON FOR
THIS COURT TO INVOKE ITS DISCRE-
TIONARY AUTHORITY TO REVIEW THE
FOURTH CIRCUIT'S DECISION..................... 16

Ce I siicinterktcatidapiiatnencincaniintnaaapitninctadinusionn 17

TABLE OF AUTHORITIES
Page
CASES
Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 105
CR. BODE CR vscesnncccttnitsienicinnteenecaneaeeions passim

Amalgamated Meat Cutters and Butcher Workmen
of N. Am., Local 195, AFL-CIO v. M. Feder & Co.,
234 F. Susp. G64 CBD. Pin. RGD occcccccccascsccnrcsnsexsosisaness 11

Avco Corp. v. Aero Lodge No. 735, Int'l Ass’n Of
Machinists & Aerospace Workers, 390 U.S. 557,

GO Bk. DORE CID vasenacntdcniiaeanemeumaes 13
Bakers Union Factory No. 326 v. ITT Cont'l Baking

Co., Inc., 749 F.2d 350 (6th Cir. 1984).....................0000 11
Bowen v. United States Postal Service, 459 US.

312, 3038. B.Cé. BRS CD iene tioiicceneoinnn 8
Caterpillar, Inc. v. Williams, 482 U.S. 386, 107

Ge. BOE Ci iviicctkkcrts inka etitenene 6, 7, 8, 12

Coca-Cola Bottling Co. of St. Louis v. Teamsters
Local Union No. 688, 959 F.2d 1438 (8th Cir.

VOID issiisicnsishcunstishichiadeasbavcmasadieatia stamina nama uamacaaaaat: 11
Cotter v. DaimlerChrysler Corp., 87 F. Supp. 2d 746

CO EW, Pe, TE aesicchenecisicckdtcnskansnsnsnicensansessacetacadarnandaas 12
Davis v. Bell Atlantic-West Virginia, Inc., 110 F.3d

245 (4th Cir. 1997)............. Aabeaaauic ecceachieaie nied a Y, 22
DelCostello v. Int’l Bhd. of Teamsters, 462 U.S. 151,

ROD. B.C. SI CA esiinsntstcinecinsndsrancintieruesrcnene passim
Duerr v. 3M, 101 F. Supp. 2d 1057 (N.D. Ill. 2000).......... 11
Franchise Tax Bd. v. Constr. Laborers Vacation

Trust, 463 U.S. 1, 103 S.Ct. 2841 (1983)... ee 12

Hillard v. Dobelman, 774 F.2d 886 (8th Cir. 1985).... 13, 15

TABLE OF AUTHORITIES - Continued

Page

International Union of Operating Eng’rs v. Cooper
Natural, 163 F.3d 916 (5th Cir.), cert. denied, 528
U2. GRR, FO BA: Ge Ce brscsehcsincastnndgesitaictionscaens 11

International Union, United Mine Workers of Am. v.
Covenant Coal Corp., 977 F.2d 895 (4th Cir.

RIED ccnnccoccdcnpasusasucnnunsakieainensniialamnnnmananaanaecan ial passim
Jackson v. Kimel, 922 F.2d 1318 (4th Cir. 1993)........ 14, 15
Jones v. General Motors Corp., 939 F.2d 380 (6th

Cher, BE) naececcssssescaseiecenscenisubaacepasenaiamuaniaicanainasaiaas 11

Kimbro v. Pepsico, Inc., 215 F.3d 723 (7th Cir. 2000).... 13, 15

Lingle v. Norge Div. of Magic Chef, Inc., 486 U.S.
S308, 100 GGL. BBFe Ci Riieiindcdeneoanandnau 12

Shiflett v. I.T.O. Corp., No. 99-1379, 2000 U.S. App.

LEXIS 263 (4th Cir. Jan. 20, 2000)..........ccccccccceceeseeeeees 15

Steinbach v. Dillon Cos., 253 F.3d 538 (10th Cir.

Tootsie Roll Indus., Inc. v. Local Union No. 1,
Bakery, Confectionary and Tobacco Workers’ Int'l

Union, 832 F.2d 81 (7th Cir. 1987) ..................cseccceeeees 11
United Mine Workers of Am. v. Barnes & Tucker

Co., 561 F.2d 1008 (Srd Cir. 1977) .......cccccsscsccccccccosseseee 11
United States Dep’t of the Air Force v. Fed. Labor

Relations Auth., 949 F.2d 475 (D.C. Cir. 1991) ............ 11
Vaca v. Sipes, 386 U.S. 171, 87 S.Ct. 903 (1967)........00.. 10
STATUTES
BD UE: © i isscisincistscrncibienentntdaciantniomiiunnnal passim
SD UG. F Beetisisisvicistsscateantivcomimenceeuaa 4, 8, 16

ee ee

1

STATEMENT OF THE CASE

From 1983 until July of 1999, petitioner Albert L.
Freeman (“Freeman”) was employed by respondents Duke
Power Company and Duke Energy Corporation (collec-
tively “Duke”) as a “lineman” in Burlington, North Caro-
lina. See Petition Appendix (“Petition Appx.”) B at p. 2b.
Freeman was a member of Local Union 962, International
Brotherhood of Electrical Workers (hereafter the “Union”),
which had, at all relevant times, various collective bar-
gaining agreements with Duke (collectively the “CBA”). Id.

On or around January 26, 1994, Freeman was sus-
pended and then discharged from his employment as a
lineman for removing a service drop and meter and dis-
connecting service to a customer without authorization
from Duke, while moonlighting as an electrical contractor.
Id. at p. 3b. The Union filed a grievance on behalf of
Freeman under the “Grievances” provision of the then
existing CBA. Jd. Prior to the referral of this grievance to
arbitration as provided by the CBA, Duke and the Union
settled the grievance and Duke, the Union, and Freeman
entered into an agreement entitled “Grievance Resolu-
tion.” Jd. Pursuant to the “Grievance Resolution,” Duke,
the Union, and Freeman agreed, inter alia, that Duke
would reinstate Freeman with no loss of service under the
CBA, but with no back pay; the Union agreed to withdraw
the grievance; and Freeman agreed not to engage, directly
or indirectly, in the business of electrical contracting while—
employed with Duke. Jd. The Grievance Resolution pro-
vided that Duke could discharge Freeman if he engaged in
electrical contracting and that the discharge decision
would be final and would not be subject to the grievance
procedures of the CBA in effect at the time of any future
discharge. Id.

In June 1996, Duke Power suspended and proposed to
discharge Freeman a second time, asserting that Freeman
violated the Grievance Resolution by engaging in electrical
contracting. Jd. Freeman asserted that he did not violate
the Grievance Resolution. Jd. In settling the dispute, the
Union, Duke, and Freeman entered into an Amendment to
the Grievance Resolution (the “Amendment”) on or about
July 3, 1996. Id. The Amendment prohibited Freeman
from being or beeoming employed on a full- or part-time
basis with any entity engaged in the business of electrical
contracting. Jd. In the Amendment, Duke agreed not to
terminate Freeman for the then current violation of the
Grievance Resolution, and Freeman agreed not to engage
in the business of electrical contracting in the future. Id.
The Amendment provided that Duke could terminate
Freeman’s employment if he violated the Amendment and
that such termination would be final and would not be
subject to the arbitration or grievance procedures under
the CBA. Id.

In July of 1999, Duke suspended Freeman and then
terminated Freeman’s employment for breaching the
terms of the Grievance Resolution and the Amendment by
engaging in the business of electrical contracting. Jd. The
Union did not file a grievance pursuant to the CBA on
behalf of Freeman regarding his July 1999 termination.
Id. at p. 4b.

On or about June 30, 2000, Freeman filed a complaint
against Duke in the General Court of Justice, Alamance
County, North Carolina asserting state law claims for
breach of employment contract, wrongful discharge, bad
faith discharge and violation of the North Carolina Consti-
tution. Jd. Duke removed the action to federal court on the
ground that Freeman’s state law claims were completely

_—

3

preempted by LMRA Section 301, 29 U.S.C. § 185(a). Duke
moved to dismiss Freeman’s claims; Freeman moved to
remand. Id.

On or about June 28, 2002, Freeman filed a separate
action in the General Court of Justice, Alamance County,
North Carolina, against respondents Cindy Thaxton
(“Thaxton”) and George Kwascha (“Kwascha”), two man-
agement employees at Duke. Id. This action asserted
claims for tortious interference with contract and unfair
and deceptive trade practices. Jd. Thaxton and Kwascha
removed this action to federal court based on complete
preemption by LMRA Section 301 and moved to dismiss.
Freeman moved to remand. Id.

The District Court granted both motions to dismiss
and denied Freeman’s motions to remand. See Petition
Appx. A. Freeman appealed to the United States Court of
Appeals for the Fourth Circuit.

On September 27, 2004, the Fourth Circuit, by unpub-
lished per curiam opinion, affirmed the District Court in
all respects. See Freeman v. Duke Power Co., 114 Fed.
Appx. 526 (4th Cir. 2004) (per curiam) (unpublished);
Petition Appx. B. As a preliminary matter, the Fourth
Circuit concluded that, based on established precedent,
the Grievance Resolution and the Amendment were labor
“contracts” within the meaning of LMRA Section 301
because they “derive[d] their ‘entire vitality and legiti-
macy’ from the CBA.” Freeman, 114 Fed. Appx. at 531-32
(quoting Davis v. Bell Atlantic-West Virginia, Inc., 110 F.3d
245, 248 (4th Cir. 1997)); Petition Appx. B at pp. 6b-7b.
The Fourth Circuit concluded further that Freeman's
breach of contract and wrongful discharge claims against
Duke and his tortious interference claim against Thaxton
and Kwascha were completely preempted by LMRA

4

Section 301. Freeman, 114 Fed. Appx. at 532-33; Petition
Appx. B at pp. 8b-9b. Accordingly, the Fourth Circuit held
that the District Court properly exercised subject matter
jurisdiction over both actions and affirmed the District
Court’s denial of the motions to remand. Id.

The Fourth Circuit treated the breach of contract and
the wrongful discharge claims against Duke as LMRA
Section 301 claims. Freeman, 114 Fed. Appx. at 533 (citing
Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 220, 105 S.Ct.
1904, 1915 (1985)); Petition Appx. B at p. 10b. The Fourth
Circuit then considered whether these claims were timely
under LMRA Section 301. Jd. As directed by this Court in
DelCostello v. Int'l Bhd. of Teamsters, 462 U.S. 151, 158,
103 S.Ct. 2281, 2287 (1983), the Fourth Circuit applied the
six-month statute of limitations found in Section 10(b) of
the National Labor Relations Act (the “NLRA”), 29 U.S.C.
§ 160(b), and held that these claims against Duke were
time barred. Freeman, 114 Fed. Appx. at 533-34 (citing
DelCostello, 462 U.S. at 158, 103 S.Ct. at 2287); Petition
Appx. B at pp. 10b-11b. It further held that Freeman’s
claims against Duke for “bad faith discharge” and for
violation of the North Carolina Constitution failed to state |
claims under North Carolina law.’ Freeman, 114 Fed.
Appx. at 534-35; Petition Appx. B at pp. 11b-12b.

As to the claims against Thaxton and Kwascha, the
Fourth Circuit concluded that the tortious interference :
with contract claim did not state a claim upon which relief
could be granted under LMRA Section 301. Freeman, 114

* Freeman does not mention either the “bad faith discharge” claim
or the claim for alleged violation of the North Carolina Constitution in
his Petition and does not assert that the Fourth Circuit erred in
affirming the dismissal of these claims.

TR een Aa —_

SL RE Nm NT mr ere

5

Fed. Appx. at 535 (following International Union, United

Mine Workers of Am. v. Covenant Coal Corp., 977 F.2d 895,
897 (4th Cir. 1992)); Petition Appx. B at pp. 12b-13b.
Finally, the Fourth Circuit concluded that Freeman’s claim
for unfair and deceptive trade practices against Thaxton
and Kwascha did not state a valid claim under North
Carolina law. Freeman, 114 Fed. Appx. at 535; Petition
Appx. B at pp. 13b-14b.

The Fourth Circuit, in reliance on well-established
precedent from this Court, the Fourth Circuit and other
federal Courts of Appeals, affirmed the decision of the
District Court in all respects. The Fourth Circuit subse-
quently denied Freeman’s petitions for rehearing and for
rehearing en banc. See Petition Appx. C.

&
Vv

REASONS FOR DENYING THE PETITION

The decision of the Fourth Circuit does not conflict
with a decision of this Court or any federal Court of
Appeals. In rendering its decision in this case, the Fourth
Circuit relied upon and applied clear, well-established and
unquestioned Fourth Circuit precedent as well as well-
established precedent from this Court and from other
federal Courts of Appeals. In short, there is no compelling
reason for this Court to review the Fourth Circuit’s deci-
sion.

I. THE DECISION OF THE FOURTH CIRCUIT
DOES NOT CONFLICT WITH ANY DECISION
OF THIS COURT.

The decision of the Fourth Circuit does not conflict
with any decision of this Court. There are three decisions

6

of this Court that are explicitly or implicitly implicated in
Freeman’s Petition: Caterpillar, Inc. v. Williams, 482 U.S.
386, 107 S.Ct. 2425 (1987); DelCostello v. Int'l Bhd. of
Teamsters, 462 U.S. 151, 103 S.Ct. 2281 (1983); and Allis-
Chalmers Corp. v. Lueck, 471 U.S. 202, 105 S.Ct. 1904
(1985). As discvssed in detail below, the Fourth Circuit’s
decision in this case does not conflict in any way with any
of these decisions. fs

A. The Decision Of The Fourth Circuit Does
Not Conflict With This Court’s Decision In
Caterpillar, Inc.

Freeman specifically asserts that the Fourth Circuit’s
decision conflicts with this Court’s decision in Caterpillar,
Inc. v. Williams, 482 U.S. 386, 107 S.Ct. 2425 (1987). See
Petition pp. 13-15. However, Freeman does not discuss or
analyze the facts or holding of Caterpillar, Inc. or set forth
any argument regarding the alleged conflict. Rather, the
Petition states simply that claims based on an “independ-
ent” agreement are not preempted by LMRA Section 301.

In Caterpillar, Inc., the plaintiffs alleged that while
they were management employees and, therefore, not
unicn members or subject to any collective bargaining
agreement, Caterpillar entered into individual employ-
ment agreements with them. See Caterpillar, Inc., 482
U.S. at 388-89, 107 S.Ct. at 2427-28. After they were
demoted to positions within the bargaining unit and then
laid off, the plaintiffs brought suit in California state court
for breach of their individual employment agreements. Jd.
at 390, 107 S.Ct. at 2428. Caterpillar removed the action
to federal court asserting complete preemption by LMRA
Section 301. Jd. This Court held that a claim for breach of
an individual employment agreement, which was brought

at.

— =

7

by an employee who was not subject to any collective
bargaining agreement at the time the individual agree-
ment was executed, and the resolution of which was not
substantially dependent on analysis of a collective bar-
gaining agreement, was not preempted by LMRA Section
301. Id. at 394-98, 107 S.Ct. at 2430-33.

In the instant case, unlike the situation in Caterpillar,
Inc., Freeman was, at all times, a member of the Union
and subject to the CBA between the Union and Duke. The
Grievance Resolution and Amendment were entered into
by Duke, Freeman and the Union to resolve a grievance
brought by the Union on Freeman’s behalf pursuant to the
CBA. As distinguished from Caterpillar, Inc., the Griev-
ance Resolution and Amendment derive their very exis-
tence from the CBA.

In its decision, the Fourth Circuit squarely addressed
this issue and distinguished Caterpillar, Inc. as follows:

Although disputes arising over independent em-
ployment contracts unrelated to a CBA are not
preempted by § 301 of the LMRA, see Caterpillar
Inc. v. Williams, 482 U.S. 386, 394-95, 107 S.Ct.
2425, 2430-31, 96 L.Ed. 2d, 2430-31 (1987), the
Grievance Resolution and the Amendment are
not independent of the CBA. The employees in
Caterpillar had entered separate management
contracts and only later became subject to a CBA
when they were demoted. Their state law action
was based on the management contracts, not
anything derivative of the CBA, and thus was
not preempted by the LMRA. 7d. at 395 & n. 9,
107 S.Ct. at 2425. The same cannot be said in the
instant case, as the Grievance Resolution and
Amendment derive their “entire vitality and le-
gitimacy” from the CBA. Davis, 110 F.3d at 248.

8
Freeman, 114 Fed. Appx. at 531-532; Petition Appx. B at p.
7b. Freeman offers no argument on how the Fourth Circuit
allegedly erred when it discussed and distinguished
Caterpillar, Inc. This Court’s decision in Caterpillar, Inc. is
distinguishable and the Fourth Circuit’s decision does not
conflict with Caterpillar, Inc. in any way.

—

B. The Decision Of The Fourth Circuit Does
Not Conflict With This Court’s Decision In
DelCostello.

Freeman’s Petition could be construed to suggest that
the Fourth Circuit’s decision conflicts with this Court’s
opinion in DelCostello due to application of the six-month
statute of limitations. See Petition p. 15. It is well estab-
lished that; where a union has agreed to waive its right to
grieve or otherwise challenge a discharge under a labor
contract, the waiver acts as a final resolution of the
matter. See Bowen v. United States Postal Service, 459
U.S. 212, 226, 103 S.Ct. 588, 596 (1983). This Court,
however, has “recognized that this rule works an unac-
ceptable injustice when the union representing the em-
ployee in the grievance/arbitration procedure
breach[es] its duty, of fair representation.” DelCostello, 462
U.S. at 164, 103 S.Ct. at 2290 (citations omitted). As a
result, this Court recognized “hybrid” LMRA Section 301
claims wherein “an employee may bring suit against both
the employer and the union, notwithstanding the outcome
or finality of the grievance or arbitration proceeding.” Id.
at 165, 103 S.Ct. at 2291. Such “hybrid” LMRA Section 301
claims borrow the six-month statute of limitations found
in Section 10(b) of the NLRA, 29 U.S.C. § 160(b). Id. at
171, 103 S.Ct. at 2294.

9

The Fourth Circuit determined correctly that, due to
the waiver of the grievance provisions of the CBA in the
Grievance Resolution and Amendment, any LMRA Section
301 claim was governed by the six-month statute of
limitations for hybrid LMRA Section 301 claims. Freeman,
114 Fed. Appx. at 533-34 (citing DelCostello, 462 U.S. at
171, 103 S.Ct. at 2294); ‘Petition Appx. B at pp. 10b-11b.
The Fourth Circuit’s application of DelCostello in this case
was correct and not in conflict with any decision of this
Court.

C. The Decision Of The Fourth Circuit Does
Not Conflict With This Court’s Decision In
Allis-Chalmers, Corp.

Freeman asserts that the Fourth Circuit’s decision
below was inconsistent with this Court’s decision in Allis-
Chalmers Corp. v. Lueck, 471 U.S. 202, 211, 105 S.Ct.
1904, 1911 (1985). See Petition p. 15. Freeman argues
that, because the Grievance Resolution and Amendment
waived his access to the grievance provisions of the CBA,
those agreements should not be considered labor contracts
within the meaning of LMRA Section 301. See Petition p.
15. Freeman suggests that Allis-Chalmers Corp. stands for
the proposition that in order to be a labor contract, an
agreement must allow access to arbitration. See id.

Allis-Chalmers Corp. does not state or imply that an
agreement must contain an arbitration provision in order
to be a labor contract within the meaning of LMRA Section
301. To the contrary, Allis-Chalmers Corp. specifically
states that “Section 301 on its face says nothing about the
substance of what private parties may agree to in a labor
contract.” Allis-Chalmers Corp., 471 U.S. at 211-12, 105
S.Ct. at 1911-12.

10.

Contrary to Freeman’s assertion, the Union’s waiver
of the grievance provisions of the CBA in the Grievance
Resolution and Amendment does not render those agree-
ments mere state law contracts. Rather, the waiver ren-
dered Duke’s decision to terminate Freeman a “final”
decision for purposes of the CBA. See Bowen, 459 U.S. at
226, 103 S.Ct. at 596. Accordingly, Freeman’s remedy was
a hybrid LMRA Section 301 action, as discussed by this
Court in DelCostello, 462 U.S. at 165, 103 S.Ct. 2291, Vaca
v. Sipes, 386 U.S. 171, 87 S.Ct. 903 (1967), and other

cases.

The Fourth Circuit’s decision does not conflict in any
way with this Court’s decision in -Allis-Chalmers Corp. or
any other case.

II. THERE IS NO CIRCUIT SPLIT ON THE QUES-
TIONS PRESENTED.

The decision of the Fourth Circuit below does not
conflict with the decisions of any other Court of Appeals on
the issues presented.

There is no split among the Courts of Appeals regard-
ing the fact that a settlement agreement entered to resolve
a grievance initiated by a union pursuant to the terms of a
collective bargaining agreement is a labor “contract”
within the meaning of LMRA Section 301. The various
Courts of Appeals agree on this point, even though they
use slightly different labels to describe the agreements at
issue.

In its decision, the Fourth Circuit characterized the
Grievance Resolution and Amendment as labor contracts
within the meaning of LMRA Section 301 because they

Pe

i

11

“deriveld) their ‘entire vitality and legitimacy’ from the
CBA.” Freeman, 114 Fed. Appx. at 531-32 (quoting Davis,
110 F.3d at 248); Petition Appx. B at pp. 6b-7b. The Sixth
Circuit and the Third Circuit have reached similar conclu-
sions with regard to grievance settlement agreements. See
Jones v. General Motors Corp., 939 F.2d 380, 382-83 (6th -
Cir. 1991) (settlement agreement arrived at by virtue of
the grievance process established by a collective bargain-
ing agreement was a labor contract within the meaning of
Section 301 of LMRA); United Mine Workers of Am. v.
Barnes & Tucker Co., 561 F.2d 1093, 1096-98 (3rd Cir.
1977) (same); see also Duerr v. 3M, 101 F. Supp. 2d 1057,
1060-61 (N.D. Ill. 2000) (same); Amalgamated Meat
Cutters and Butcher Workmen of N. Am., Local 195, AFL-
CIO v. M. Feder & Co., 234 F. Supp. 564, 548 (E.D. Pa.
1964) (same).

Other Courts of Appeals, including the Fifth, Sixth,
Seventh, Eighth and District of Columbia Circuits, have
uniformly held that settlement agreements arising out of
grievances, which are typically characterized as “last _
chance agreements,” are labor contracts within the mean-
ing of LMRA Section 301. See Intl Union of Operating
Eng'rs v. Cooper Natural, 163 F.3d 916, 919 (5th Cir.), cert.
denied, 528 U.S. 812, 120 S.Ct. 45 (1999) (last chance
agreement is labor contract for purposes of Section 301 of
LMRA); Coca-Cola Bottling Co. of St. Louis v. Teamsters
Local Union No. 688, 959 F.2d 1438 (8th Cir. 1992) (same);
United States Dep't of the Air Force v. Fed. Labor Relations
Auth., 949 F.2d 475, 478 (D.C. Cir. 1991) (same); Tbotsie
Roll Indus., Inc. v. Local Union No. 1, Bakery, Confection-
ary and Tobacco Workers’ Int’l Union, 832 F.2d 81, 82 (7th
Cir. 1987) (same); Bakers Union Factory No. 326 v. ITT
Conti Baking Co., Inc., 749 F.2d 350, 354 (6th Cir. 1984)

12

(same); see also Cotter v. DaimlerChrysler Corp., 87
F. Supp. 2d 746, 757 (E.D. Mich. 2000) (same).

The Fourth Circuit’s decision is wholly consistent with
the vast body of well-established precedent that a settle-
ment agreement entered into to resolve a grievance
initiated by a union pursuant to the terms of a collective
bargaining agreement is a labor contract within the
meaning of LMRA Section 301. Further, there is no split
among the Courts of Appeals regarding any other question
presented in the instant action.

Il. THIS CASE DOES NOT PRESENT ANY QUES-
TION OF EXCEPTIONAL IMPORTANCE TO LA-
BOR LAW JURISPRUDENCE WHICH SHOULD
BE DECIDED BY THIS COURT.

In rendering its decision, the Fourth Circuit applied
well-established precedent from this Court, the Fourth
Circuit and the other Courts of Appeals.

As discussed in Section II, supra, it is well established
in the Fourth Circuit and the other Courts of Appeals that
agreements such as the Grievance Resolution and the
Amendment are labor contracts within the meaning of
LMRA Section 301.

The case law from this Court firmly establishes that a
state law claim for breach of a labor contract and any
other claim the resolution of which requires the interpre-
tation of a labor contract are completely preempted by
LMRA Section 301. See Lingle v. Norge Div. of Magic Chef,
Inc., 486 U.S. 399, 108 S.Ct. 1877 (1988); Allis-Chalmers
Corp., 471 U.S. at 220, 105 S.Ct. at 1915; Caterpillar, Inc.,
482 U.S. at 393, 107 S.Ct. at 2430; Franchise Tax Bd. v.

13

Constr. Laborers Vacation Trust, 463 U.S. 1, 24, 103 S.Ct.
2841, 2854 (1983); Avco Corp. v. Aero Lodge No. 735, Int'l
Ass'n Of Machinists & Aerospace Workers, 390 U.S. 557, 88
S.Ct. 1235 (1968). Further, it is firmly established that
state law claims that are completely preempted by LMRA
Section 301 “must either be treated as a § 301 claim... or

dismissed as preempted by federal labor-contract law.”
Allis-Chalmers Corp., 471 U.S. at 220, 105 S.Ct. at 1915.

It is well-established precedent in this Court that,
where a decision is “final” under a labor contract, either by
operation of the grievance procedure or by waiver, a
plaintiff may only pursue a “hybrid” LMRA Section 301
claim. See DelCostello, 462 U.S. at 165, 103 S.Ct. at 2291;
Vaca, 386 U.S. 171, 87 S.Ct. 903. Further, it is beyond
question that “hybrid” LMRA Section 301 claims are
subject to the six-month statute of limitations found in
Section 10(b) of the NLRA, 29 U.S.C. § 160(b), and that
claims bought after the expiration of this statute of limita-
tions fail as matter of law. DelCostello, 462 U.S. at 171,
103 S.Ct. at 2294.

Fourth Circuit and other Courts of Appeals have
repeatedly held that a claim against a manager, supervisor
or other third-party for tortious interference with a labor
contract is preempted by LMRA Section 301. See Covenant
Coal Corp., 977 F.2d at 897 (claim for tortious interference
with labor contract preempted by LMRA Section 301);
Steinbach v. Dillon Cos., 253 F.3d 538, 540 (10th Cir. 2001)
(same); Kimbro v. Pepsico, Inc., 215 F.3d 723, 727 (7th Cir.
2000) (same); Hillard v. Dobelman, 774 F.2d 886, 887 (8th
Cir. 1985) (same).

Freeman specifically argues in his Petition that the
question of whether the Grievance Resolution and the

14

Amendment are “riders” to the CBA, “last chance agree-
ments” or mere state law contracts is a question of excep-
tional importance to labor law jurisprudence that should
be decided by this Court. See Petition pp. 15-16. As dis-
cussed above, however, it is firmly established in the
Courts of Appeals that a settlement agreement entered
into to resolve a grievance initiated by a union pursuant to
the terms of a collective bargaining agreement is a labor
contract within the meaning of LMRA Section 301, regard-
less of the semantics of labeling such an agreement a
“rider to the CBA” or a “last chance agreement.” See
Section II, supra. This issue is well settled in labor law
jurisprudence and need not be considered by this Court.

The case at bar presents no new issues. The issues
raised in the Petition are firmly established in labor law
jurisprudence, through the decisions of this Court and the
Courts of Appeals, and should not be disturbed. There is
simply no unsettled question of exceptional importance to
labor law jurisprudence presented in this case.

IV. THERE IS NO INTERNAL CONFLICT WITH
THE CASE LAW OF THE FOURTH CIRCUIT
ON THE QUESTIONS PRESENTED.

In finding that Freeman’s claim against Thaxton and
Kwascha for tortious interference with contract was
preempted, the Fourth Circuit applied “controlling and
unquestioned circuit precedent.” Freeman, 114 Fed. Appx.
at 535 (citing Covenant Coal Corp., 977 F.2d at 897);
Petition Appx. B at pp. 12b-13b. Nevertheless, Freeman
asserts as a basis for review by this Court that the Fourth
Circuit’s decision below conflicted with the Fourth Cir-
cuit’s previous opinion in Jackson v. Kimel, 922 F.2d 1318
(4th Cir. 1993). See Petition pp. 16-19.

~ mene + ee —

- a enn.

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15

The Fourth Circuit’s decision in Jackson is distin-
guishable and inapplicable in this case. The issue in
Jackson was whether a state law claim for intentional
infliction of emotional distress against a former supervisor
was preempted by LMRA Section 301. The Fourth Circuit
held that such a claim was not preempted because the
supervisor's conduct “if it occurred as alleged, [was]
wrongful regardless of whether it was authorized by the
collective bargaining agreement.” Jackson, 992 F2d at
1326. Interpretation of the relevant labor contract was not
necessary to establish any element of the plaintiff’s claizn.

Unlike Jackson, the claim at issue in this case was a
purported state law claim for tortious interference with
various labor contracts, including the CBA, the Grievance
Resolution and the Amendment. The Fourth Circuit
explicitly held in Covenant Coal Corp., 977 F.2d at 897,
that a state law claim for tortious interference with
contract is preempted by LMRA Section 301 where the
contract at issue was a labor contract. See also Steinbach,
253 F.3d at 540 (claim for tortious interference with labor
contract preempted by LMRA Section 301); Kimbro, 215
F.3d at 727(same); Hillard, 774 F.2d at 887 (same).

In his Petition, Freeman quotes extensively from the
concurring opinion in Jackson in support of his position.
See Petition pp. 17-19 (quoting Jackson, 992 F.2d at 1327-
28 (Phillips, J., concurring)). However, the Fourth Circuit
has specifically rejected the reasoning of this concurrence
in Jackson as inconsistent with its prior decision in Cove-
nant Coal Corp. See Shiflett v. I.T-0. Corp., No. 99-1379,
2000 U.S. App. LEXIS 263 (4th Cir. Jan. 20, 2000).

Based on its decision in Covenant Coal Corp., the
Fourth Circuit determined that it was “bound ... by prior

16

controlling and unquestioned circuit precedent” and,
therefore, held that Freeman’s claim for tortious interfer-
ence with contract was preempted and should be dis-
missed. Freeman, 114 Fed. Appx. at 535 (citing Covenant
Coal Corp., 977 F.2d at 897); Petition Appx. B at pp. 12b-
13b. This decision was not in conflict with Jackson or any
other decision by the Fourth Circuit.

V. THERE IS NO COMPELLING REASON FOR
THIS COURT TO INVOKE ITS DISCRETION-
ARY AUTHORITY TO REVIEW THE FOURTH
CIRCUIT’S DECISION.

In his Petition, Freeman argues that he will be left
without a remedy if the Fourth Circuit’s decision is not
reviewed and reversed by this Court and, therefore, this
Court should grant certiorari to correct this “unjust and
harsh” result. (Petition pp. 15, 19-21). Freeman had
remedies available to him but he did not pursue them.

For example, Freeman could have asserted a hybrid
LMRA Section 301 claim against Duke and the Union at
any time prior to the expiration of the six-month statute of
limitations in January of 2000; however, he did not do so.
Likewise, Freeman could have filed an unfair labor prac-
tice charge with the National Labor Relations Board
regarding any alleged conduct by Thaxton and Kwascha;
however, he did not do so.’ See Covenant Coal Corp., 977
F.2d at 899-900 (noting availability of unfair labor practice

* Both a hybrid LMRA Section 301 action and an unfair labor
practice charge are subject to the six-month statute of limitations
contained in 29 U.S.C. § 160(b). See DelCostello, 462 U.S. at 171, 103
S.Ct. at 2294.

17

charge to redress alleged interference with labor contract
by third-party who was not a signatory of the labor con-
tract). Freeman’s failure to pursue the remedies available
to him is not a compelling reason for this Court to invoke
its discretionary authority to review the Fourth Circuit’s
decision. 7

Further, the Fourth Circuit correctly applied North
Carolina law in concluding that Freeman’s claim for unfair
and deceptive trade practices failed to state a claim upon
which relief could be granted. Any alleged error in the
application of North Carolina law in this case fails to
provide a compelling reason for this Court to invoke its
discretionary authority to review the Fourth Circuit’s
decision.

¢

CONCLUSION

For the foregoing reasons, Respondents respectfully
request that the Court deny the Petition for Writ of Certio-
rari.

Respectfully submitted, this the 28th day of February,
2005. |

D. BETH LANGLEY

Counsel of Record
BRIAN S. CLARKE
NEXSEN PRUET ADAMS KLEEMEIER, PLLC
701 Green Valley Road, Suite 100
Greensboro, North Carolina 27408
(336) 373-1600

Counsel for Respondents

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386007_1329%3A3. Public record. Not legal advice.