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Hunt & Harris Law Firm v. International Paper Co.

November 6, 2006

HUNT & HARRIS LAW FIRM PLAINTIFF
v.
INTERNATIONAL PAPER COMPANY AND CALVIN STAUDT DEFENDANT



The opinion of the court was delivered by: Wm. R. Wilson, Jr. United States District Judge

ORDER

This is an interference with contract claim. Plaintiff, Hunt and Harris Law Firm, alleges that Defendants interfered with an attorney client contract based on a client's Equal Employment Opportunity ("EEOC") claim. This case was filed in state court, but was removed.*fn1

An Order was entered denying Plaintiff's Motion to Remand.*fn2 However, questions about federal preemption were raised anew when Defendant filed its Motion for Summary Judgment.*fn3 Because of doubts about preemption, the parties were asked to clarify their arguments on this issue.*fn4 Defendant filed its Response to the Court's Request for Clarification of the Preeemption Issues,*fn5 and Plaintiff responded with a Brief in Opposition.*fn6 Also pending is Defendant's Motion for Summary Judgment*fn7 and the EEOC's Motion to Quash.*fn8

I. Background

Plaintiff's claim arises from its representation of Earnestine White ("White"), one of Defendant International Paper's ("IP") employees. After being discharged by IP, White filed a grievance with her union and then hired Plaintiff to represent her in an employment discrimination suit. Plaintiff immediately notified IP that it represented White and made a settlement demand to IP with White's approval. Plaintiff also filed an EEOC charge on White's behalf.*fn9

Defendants were aware that White was represented in her EEOC claim. Nevertheless, Defendants settled the Title VII claim with White as part of a grievance procedure under a collective bargaining agreement ("CBA") between IP and the Union.*fn10 Under the CBA the Union is the "exclusive representative for collective bargaining for all of its production and maintenance employees."*fn11 While the Union is given general powers of arbitration under the CBA, there is no specific language in this agreement that compels union representation and arbitration of discrimination or Title VII claims.*fn12

White settled her claim through the Union. She was reinstated and given a lump-sum payment equivalent to sixty days of wages. The settlement was paid directly to White. Her lawyer was unaware of the negotiation and did not participate in the settlement. In the settlement, White released "any and all claims she may have against the Company [IP] related to her termination or the incident that led to her termination."*fn13 The Release included "all claims under any and all federal, state, and local law, including but not limited to, Title VII of the Civil Rights Act of 1964."*fn14

Defendants maintain that federal jurisdiction is proper under 28 U.S.C. § 1441(b). Defendants argue that in order to decide whether the Defendants improperly interfered with the attorney client contract, an interpretation of the CBA is necessary. The application and interpretation of the CBA are governed by the Labor Management Relations Act.*fn15

II. Authority

A. Preemption

Section 301 of the LMRA preempts state law claims "where the resolution of the state claim substantially depends on the interpretation of terms or provisions of a collective bargaining agreement,"*fn16 or where it is "inextricably intertwined" with consideration of the collective bargaining agreement.*fn17 On the other hand, simply referring to a collective bargaining agreement does not result in preemption.*fn18 When the meaning of contract terms is not disputed, the bare fact that a collective-bargaining agreement will be consulted in the course of state-law litigation plainly does not require the claim to be extinguished."*fn19 Complaints alleging a violation of state law without asserting a breach of the CBA have been found not preempted by federal law.*fn20 However, if a plaintiff relies on the terms of a CBA to establish a state law claim --then the claim is preempted.*fn21

B. Waiver of Title VII Rights

When an employee has both a contractual right by virtue of a collective bargaining agreement (or other employment contract), and a statutory right to be free from discrimination, "both rights have legally independent origins and are equally available to the aggrieved employee."*fn22 A union cannot surrender an employees' Title VII rights, without the employee's permission*fn23

The Supreme Court held that a CBA does not automatically give a union exclusive control of Title VII claims: "We will not infer from a general contractual provision that the parties intended to waive a statutorily protected right unless the undertaking is 'explicitly stated.' More succinctly, the waiver must be clear and unmistakable."*fn24 The Court further held: "We think the same standard is applicable to a ...


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