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Wyatt v. United Airlines, Inc.

United States District Court, E.D. North Carolina, Southern Division

August 13, 2014

SHERRY L. WYATT, Plaintiff,
v.
UNITED AIRLINES, INC., Defendant.

ORDER

JAMES C. FOX, Senior District Judge.

This matter is before the court on United's motion to dismiss [DE-11]. The case presents the issue of whether a retired airline employee must submit disputes regarding the retiree's pass travel benefits to the airline grievance procedure and arbitration under the Railway Labor Act ("RLA"), 45 U.S.C. § 151 et seq . The court concludes that Wyatt must do so and that her request for injunctive relief to compel arbitration is premature at this stage. Accordingly, the court does not have subject matter jurisdiction, United's motion to dismiss is ALLOWED and the case is DISMISSED.

FACTUAL AND PROCEDURAL BACKGROUND

Wyatt initiated this suit in North Carolina state court, bringing state law claims for breach of contract, fraud, and declaratory judgment. United timely removed the case to this court on the basis of diversity jurisdiction. Notice of Removal [DE-1]. Subsequently, Wyatt amended her complaint to include a claim for an injunction compelling arbitration "[i]n the event that it is determined Plaintiff's preceding claims are subject to mandatory arbitration under the Railway Labor Act...." Am. Compl. [DE-9] ¶ 60.

Wyatt's claims are predicated on United's changes to her retirement "pass travel benefits."[1] Pass travel benefits allow current and retired employees to travel at little or no cost, typically on a space available basis. Wyatt was hired on August 10, 1966 and at the time she joined United the retiree benefit package included pass travel benefits at the highest boarding priority for retirees with at least twenty-five years of service. This "super" priority boarding status meant these retirees could board before other retirees with less years of service or current employees wishing to exercise their pass travel benefits. These benefits were memorialized in a Collective Bargaining Agreement between the Association of Flight Attendants ("AFA") and United. Wyatt states that she "was induced to accept the offer of employment from United by the promise [of these retiree pass travel benefits]." Resp. [DE-13] at 2.

With some modifications not relevant here, this pass travel policy was part of the Collective Bargaining Agreement when Wyatt retired in 2003, with over thirty-seven years of experience with United. In 2002, Wyatt received a letter from United executive Glenn Tilton that encouraged her to retire within a year and emphasized that she would receive the full retirement package, including the unlimited pass travel benefits with the highest boarding priority. According to Wyatt, the super boarding priority is an important benefit because a particular employee or retiree may only use the benefit if seats are available on the desired flight. Thus, the priority status afforded retirees with at least twenty-five years experience means those retirees are more likely to be able to use their pass travel benefits on popular, heavily booked flights. Wyatt indicates that she based her retirement decision at least in part on the assumption that United would not change her pass travel benefits while she was in retirement.

When United merged with Continental Airlines in 2010, it changed the retiree pass travel policy. The new policy, which applies to all current employees and retirees, provides each employee/retiree with eight one-way passes per year at the highest boarding priority. Unused passes also carry over to following years. The new policy eliminated the "super" priority boarding status for retirees at United with at least twenty-five years of service and the new policy actually preferences active employees in terms of boarding priority. As a result of higher demand and United's method of booking flights, Wyatt indicates that the loss of super priority boarding renders the pass travel benefits "significantly-less advantageous" to retirees with twenty-five years or more experience.

Wyatt alleges that the changes to the pass travel benefits policy constitute a breach of United's Collective Bargaining Agreement with the AFA. Her fraud claim is predicated on United's purported false representations regarding the permanency of the pass travel program for current retirees. United maintains that the Collective Bargaining Agreement expressly permits it to change retirees' pass travel benefits, so long as it provides notice and an opportunity to object to the AFA.[2]

DISCUSSION

United moves to dismiss Wyatt's claims for lack of subject matter jurisdiction. Fed.R.Civ.P. 12(b)(1). Rule 12 states that "[i]f the court determines at any time that it lacks subject matter jurisdiction, the court must dismiss the action." Fed.R.Civ.P. 12(h)(3). Rule 12(b)(1) challenges to the court's subject matter jurisdiction can take one of two forms: (1) an argument that the complaint's allegations, taken as true, do not support subject matter jurisdiction (a "facial challenge" to jurisdiction); or (2) an argument that the jurisdictional allegations in the complaint are not true. Kerns v. United States , 585 F.3d 187, 192 (4th Cir. 2009). Although United does not specify the form of its Rule 12(b)(1) argument, it is clear from its briefing that it launches a facial challenge to the court's jurisdiction. In such a case, the plaintiff is afforded "the same procedural protection as [s]he would receive under a Rule 12(b)(6) consideration." Id. at 192; Adams v. Bain , 697 F.2d 1213, 1219 (4th Cir. 1982). That is, "the facts alleged in the complaint are taken as true, and the motion must be denied if the complaint alleges sufficient facts to invoke subject matter jurisdiction." Kerns , 585 F.3d at 192.

As noted, Wyatt's claims implicate the Railway Labor Act ("RLA"), 45 U.S.C. § 151 et seq . The RLA provides in relevant part that

"disputes between an employee or group of employees and a carrier or carriers by air growing out of grievances, or out of the interpretation or application of agreements concerning rates of pay, rules, or working conditions... shall be handled in the usual manner up to and including the chief operating officer of the [airline]; but, failing to reach an adjustment in this manner, the disputes may be referred by petition of the parties or by either party to an appropriate adjustment board...."

§ 184. The Supreme Court has determined that this provision provides the airline arbitration boards with exclusive jurisdiction over all claims involving interpretation of RLA-governed collective bargaining agreements. Hawaiian Airlines, Inc. v. Norris , 512 U.S. 246, 261, 263 (1994); Consol. Rail Corp. v. Ry. Labor Executives' Ass'n , 491 U.S. 299, 304 (1989). Thus, if a plaintiff's claims are dependent on interpreting such a collective bargaining agreement, the claims are deemed "minor disputes" preempted by the RLA and the federal and state courts lack subject matter jurisdiction over them. Consol. Rail , 491 U.S. at 304; United Transp. Union v. S.C. Pub. Ry. Cmm'n , 130 F.3d 627, 627-28 (4th Cir. 1997). This is so because Congress has entrusted interpretation of the collective bargaining agreements to the arbitration boards, who have specialized knowledge and expertise regarding them. See Pa. R.R. Co. v. Day , 360 U.S. 548, 551 (1959). In addition, interpretation of the agreements by one centralized board promotes uniformity of interpretation and orderly resolution of disputes. Id.

In this case, three of Wyatt's claims require interpretation of the United-AFA Collective Bargaining Agreement and, accordingly, the court does not have subject matter jurisdiction over them. Wyatt's breach of contract claim is expressly pled as a breach of the collective bargaining agreement and therefore it requires interpretation of the relevant provisions of the agreement. Am. Compl. [DE-9] ¶¶ 33-41. Thus, it is a minor dispute preempted by the RLA. See, e.g., Consol. Rail , 491 U.S. at 305 ("The distinguishing feature [of a minor dispute] is that the dispute may be ...


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