Date: 02-26-2018

Case Style:

Case Number: 17-1864

Judge: Sutton

Court: United States Court of Appeals for the Sixth Circuit on appeal from the Western District of Michigan (Saginaw County)

Plaintiff's Attorney: Amanda K. Freeman

Defendant's Attorney: Douglas Korney

Description: The Labor Management Relations Act makes it a crime for an
employer to deduct union dues from an employee’s paycheck and for the union to accept the
dues, except if the employee consents by signing an authorization form, often called a dues
checkoff. Robbie Ohlendorf and Sandra Adams signed dues checkoff authorizations with their
employer in 2013. When they tried to revoke them three years later, they did not follow the
protocol for revoking their consent, and the union insisted that they do so. Ohlendorf and Adams
sued the union in response. Their putative class action lawsuit seeks damages and injunctive
relief on the ground that the union violated the Act and its duty of fair representation. The
district court dismissed the complaint as a matter of law. Because this criminal law does not
create a private right of action and because the union did not act arbitrarily or in bad faith, we
affirm.
I.
Ohlendorf and Adams worked for Oleson’s Food Stores in Michigan. The collective
bargaining agreement between Oleson’s and Local 876 of the United Food & Commercial
Workers Union allowed Oleson’s to deduct union dues from their employees’ paychecks if the
employee signed an authorization form. The form provided that the checkoff authorization
would be irrevocable for one year or until the termination date of the agreement, whichever
occurred sooner, and thereafter for yearly periods unless revoked by certified mail during a 15-
day window each year.
Ohlendorf and Adams joined the union in 2013 and signed the authorization forms.
Three years later, they resigned their membership and tried to revoke their permission. But they
sent their written revocations by regular mail, not certified mail, and did so outside of the 15-day
period for revoking authorization. The union refused to accept the revocations for that year. The
company thus continued to deduct union dues from their wages, and the union continued to
accept the payments.
No. 17-1864 Ohlendorf, et al. v. United Food & Commercial
Workers Int’l Union, Local 876
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Ohlendorf and Adams filed a class action against the union, claiming it violated the
Labor Management Relations Act by imposing conditions on their ability to revoke their
authorizations and violated its duty of fair representation by enforcing those conditions. They
sought damages and injunctive relief. The district court dismissed the complaint as a matter of
law, prompting this appeal. While the appeal was pending, Adams successfully revoked her
authorization and Ohlendorf quit working at Oleson’s.
II.
Article III of the United States Constitution empowers the federal courts to hear only
cases or controversies, U.S. Const. art. III, § 2, cl. 1, “a cradle-to-grave requirement” that must
be satisfied at the time a claimant files a lawsuit and must remain throughout the life of the case,
Fialka-Feldman v. Oakland Univ. Bd. of Tr., 639 F.3d 711, 713 (6th Cir. 2011). If something
happens that makes it “impossible” to grant “effectual relief” with respect to a claim, that claim
must be dismissed as moot. Church of Scientology of Cal. v. United States, 506 U.S. 9, 12
(1992).
Events have mooted one of the claims filed by Ohlendorf and Adams. They asked the
district court to enjoin the union from enforcing the window-period and certified-mail
requirements. But Ohlendorf no longer works for Oleson’s and Adams recently revoked her
authorization. An injunction on this score thus would not do them any good. While that
forward-looking claim is moot, the employees’ backward-looking request for damages—the
money they paid to the union after the union refused to honor their attempts to revoke—lives on.
III.
Section 302 of the Labor Management Relations Act makes it a crime for an employer to
willfully give money to a labor union, 29 U.S.C. § 186(a), and for a labor union to willfully
accept money from an employer, id. § 186(b). The prohibition contains several exemptions.
Pertinent here, the Act exempts “money deducted from the wages of employees in payment of
membership dues in a labor organization” if “the employer has received from each employee, on
whose account such deductions are made, a written assignment.” Id. § 186(c)(4). Under the
exception, written assignments “shall not be irrevocable for a period of more than one year, or
No. 17-1864 Ohlendorf, et al. v. United Food & Commercial
Workers Int’l Union, Local 876
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beyond the termination date of the applicable collective agreement, whichever occurs sooner.”
Id.
The Attorney General has authority to enforce this criminal statute. But he has not done
so with respect to these allegations. Nor have Ohlendorf and Adams filed a charge with the
National Labor Relations Board that the union or their employer has committed an unfair labor
practice.
What we have instead is a civil lawsuit filed by Ohlendorf and Adams in federal district
court to enforce this criminal statute. That is not an everyday event in the federal courts. Before
individuals may file such a lawsuit, they must identify a statutory cause of action that allows
them to do so. Alexander v. Sandoval, 532 U.S. 275, 286 (2001). They point to no such law, and
under basic customs of statutory interpretation no such right of action exists.
“An express federal cause of action states, in so many words, that the law permits a
claimant to bring a claim in federal court.” Traverse Bay Area Intermediate Sch. Dist. v. Mich.
Dep’t of Educ., 615 F.3d 622, 627 (6th Cir. 2010). Nothing in § 302 says that private parties
may enforce the law. The relevant language imposes federal criminal penalties on parties who
willfully violate the statute: a criminal fine up to $15,000 or imprisonment up to five years.
29 U.S.C. § 186(d). That is a form of relief usually enforced by the federal government, not
private parties. The section about “Penalties for violations” says nothing about civil remedies.
That leaves the possibility of an implied right of action. But that is an increasingly rare
creature, one that requires us to infer that Congress created a private right and provided for a
private remedy, all without taking the conventional route of doing so expressly. See generally
Ziglar v. Abbasi, 137 S. Ct. 1843, 1855–58 (2017); Rancho Palos Verdes v. Abrams, 544 U.S.
113, 119–20 (2005).
Section 302 does not confer any individually enforceable right, “phrased in terms of the
persons benefited.” Gonzaga Univ. v. Doe, 536 U.S. 273, 284 (2002) (quotations omitted).
Much less does the provision do so clearly. “[I]f Congress wishes to create new rights
enforceable under [an implied private right of action], it must do so in clear and unambiguous
terms.” Id. at 290.
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How, one might wonder, does Congress “imply” a right of action in “clear and
unambiguous terms”? The answer is that the rights-creating language must be “clear and
unambiguous.” McCready v. White, 417 F.3d 700, 703 (7th Cir. 2005). “Rights,” it also
deserves mention, differ from the “broader or vaguer ‘benefits’ or ‘interests’” that some statutes
create. Rancho Palos Verdes, 544 U.S. at 119–20. Statutes that ban conduct but do not identify
specific beneficiaries do not suffice. Sandoval, 532 U.S. at 289.
The concrete usually beats the abstract. Some examples may help. On the permissible
side of the line: A statute that says “[n]o person in the United States shall . . . be subjected to
discrimination” on the basis of race creates an individual right to be free from race
discrimination. Cannon v. Univ. of Chicago, 441 U.S. 677, 691 (1979). And a statute that reads
“[n]o person in the United States shall, on the basis of sex, . . . be subjected to discrimination”
creates an individual right to be free from sex discrimination. Id. Both statutes clearly spell out
the rights and beneficiaries and thus suffice to create implied rights of action.
On the impermissible side of the line: A statute prohibiting the funding of “any
educational agency or institution which has a policy or practice of permitting the release of
education records” creates no rights at all, even though some people (students) might benefit
from the statute and might have an interest in enforcing it. Gonzaga, 536 U.S. at 287–88.
Neither does a statute that authorizes federal agencies “to effectuate the provisions of [a ban on
intentional race discrimination] . . . by issuing rules, regulations, or orders of general
applicability.” Sandoval, 532 U.S. at 288–89. Nor a statute that says “[t]he chief State election
official . . . shall enter into an agreement to match information in the database of the statewide
voter registration system with information in the database of the motor vehicle authority.”
Brunner v. Ohio Republican Party, 555 U.S. 5, 5 (2008) (per curiam). Nor a statute that requires
state governments to “substantially comply” with federal requirements to receive federal funds
under Title IV-D of the Social Security Act. Blessing v. Freestone, 520 U.S. 329, 344 (1997).
Nor a statute that requires the federal government to “approve any [state Medicaid] plan which
fulfills the conditions specified” in another subsection. Armstrong v. Exceptional Child Center,
Inc., 135 S. Ct. 1378, 1387 (2015) (plurality opinion).
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Section 302 falls on the impermissible side of this line. It does not create person-specific
rights. Like the statutes in Gonzaga, Sandoval, Brunner, Blessing, and Armstrong, it “focus[es]
on the person[s] regulated rather than the individuals protected.” Sandoval, 532 U.S. at 289.
The statute makes it a crime for an employer to willfully give money to a union, 29 U.S.C.
§ 186(a), and it makes it a crime for the union to willfully accept the money, id. § 186(b). It does
not say anything about the individuals protected or their capacity to file a lawsuit under the
standard of care—in truth, standard of criminal liability—created. See Unite Here Local 355 v.
Mulhall, 134 S. Ct. 594, 595 (2013) (Breyer, J., joined by Sotomayor and Kagan, JJ., dissenting)
(questioning whether § 302 creates a private right of action “in light of the Court’s more
restrictive views on private rights of action in recent decades”).
Sure enough, one can identify potential beneficiaries of the statute: employees. But that
puts them in a category covered by all criminal laws: victims. We do not casually, or for that
matter routinely, imply private rights of action in favor of the victims of violations of criminal
laws. Central Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A., 511 U.S. 164, 190
(1994). Quite the opposite is true, as all of the following cases confirm. See, e.g., Stoneridge
Inv. Partners, LLC v. Scientific-Atlanta, Inc., 552 U.S. 148, 165–66 (2008); Central Bank of
Denver, 511 U.S. at 190–91; Chrysler Corp. v. Brown, 441 U.S. 281, 316 (1979); Transamerica
Mortg. Advisors, Inc. v. Lewis, 444 U.S. 11, 20 (1979); Cort v. Ash, 422 U.S. 66, 80 (1975).
Other indicators of meaning confirm this reading of the statute. Section 302 is flanked by
provisions of the Labor Management Relations Act that expressly establish private rights of
action. Section 301 says that “[s]uits for violation of contracts between an employer and a labor
organization . . . may be brought in any district court.” 29 U.S.C. § 185(a). But that provision—
creating a right of action for violations of collective bargaining agreements—does not cover this
dispute. Section 303 says that “[w]hoever shall be injured in his business or property by reason
o[f] any violation of [the ban on secondary boycotts] may sue therefor in any district court.”
29 U.S.C. § 187(b). That provision has no application here either.
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When Congress wished to provide a private right of action, as these provisions indicate, it
had no trouble doing so—clearly. Touche Ross & Co. v. Redington, 442 U.S. 560, 572 (1979).
We should respect its ability to decide when, and when not, to create private rights of action.
Ohlendorf and Adams insist that § 302(e) confers an express cause of action. But that is
not so. That provision grants jurisdiction to the federal courts “to restrain violations of this
section.” 29 U.S.C. § 186(e). It says nothing about giving private parties the right to sue, and
most assuredly says nothing about a right to sue for money damages. No Supreme Court case
during the last four decades has found a private right of action from a jurisdictional provision.
That is because a jurisdictional provision “creates no cause of action of its own force and effect”
and “imposes no liabilities.” Touche Ross, 442 U.S. at 577; see Columbia Gas Transmission,
LLC v. Singh, 707 F.3d 583, 592 (6th Cir. 2013). Any such rights must be found in the
substantive provisions of the statute, not its jurisdictional provisions. Touche Ross, 442 U.S. at
577.
But what does § 302(e) do if it does not create a private right of action, Ohlendorf and
Adams ask? Why else allow jurisdiction to restrain violations of the law? Two answers. One:
The statute creates jurisdiction for the courts to restrain violations of § 302 at the request of the
Attorney General. Having entrusted the Attorney General to protect the public from criminal
violations of § 302, Congress gave the federal courts authority to hear such actions and to permit
federal courts (at the behest of the Attorney General) to enjoin violations of this criminal labor
law.
Two: Section 302(e) provides the courts with jurisdiction to enjoin violations of § 302 in
lawsuits brought under express private rights of action, as a needed exception to the Clayton Act
and the Norris-LaGuardia Act’s ban on labor-dispute injunctions. See 29 U.S.C. § 52; id.
§§ 101–115. Consider a couple examples. Suppose that a union files a § 301 lawsuit (for breach
of a collective bargaining agreement) seeking to enforce a provision of a collective bargaining
agreement that violates § 302. In that situation, § 302(e) gives the court the power to enjoin the
union from enforcing the collective bargaining agreement notwithstanding the Clayton and
Norris-LaGuardia Acts. Cf. Anheuser-Busch, Inc. v. Int’l Bhd. of Teamsters, Local 822, 584
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F.2d 41 (4th Cir. 1978). Or suppose that an arbitrator finds that an employer breached a
provision of a collective bargaining agreement and awards damages to the union. The company
might challenge the arbitration award under the Federal Arbitration Act, 9 U.S.C. § 10, by
arguing that the provision of the collective bargaining agreement violates § 302 and therefore
cannot be enforced. In that situation, the district court may set the arbitration award aside.
See Jackson Purchase Rural Elec. Coop. Ass’n v. Local Union 816, Int’l Bhd. of Elec. Workers,
646 F.2d 264 (6th Cir. 1981). And under § 302(e), it also may enjoin the union from seeking to
enforce the agreement notwithstanding the Clayton and Norris-LaGuardia Acts.
Ohlendorf and Adams claim that two Supreme Court decisions already have decided the
question in their favor. Not true. Local 144 Nursing Home Pension Fund v. Demisay, 508 U.S.
581 (1993), never addressed today’s issue. Plus, the claimants lost the injunction case on the
merits anyway, which is why the opinion merely quotes § 302(e) but never analyzes whether it
or any other provision creates a private right of action. Id. at 587. Sinclair Refining Co. v.
Atkinson, 370 U.S. 195 (1962), is of a piece, though even less relevant. That claimant too lost on
the merits. And all it does is refer to the language of § 302(e) in addressing an issue unconnected
to this dispute. Id. at 205. Neither case says anything about a money-damages private right of
action.
None of this leaves the employees without recourse. They may wait for the Attorney
General to prosecute the union for violating § 302. Or they may ask the Attorney General to
seek an injunction. Or they may file a complaint with the National Labor Relations Board on the
ground that a violation of § 302 or a similar statute amounts to an unfair labor practice under the
National Labor Relations Act. See WKYC-TV, Inc., 359 NLRB 286, 289 n.13 (2012); Int’l Bhd.
of Elec. Workers, Local No. 2088, AFL-CIO (Lockheed), 302 NLRB 322, 325 n.8 (1991). Many
employees, including employees in this circuit, have taken this last route. See, e.g., Stewart v.
NLRB, 851 F.3d 21 (D.C. Cir. 2017); United Food & Commercial Workers Dist. Union Local
One, AFL-CIO v. NLRB, 975 F.2d 40 (2d Cir. 1992); NLRB v. U.S. Postal Serv., 833 F.2d 1195
(6th Cir. 1987); Peninsula Shipbuilders’ Ass’n v. NLRB, 663 F.2d 488 (4th Cir. 1981); NLRB v.
Atlanta Printing Specialties & Paper Prod. Union 527, AFL-CIO, 523 F.2d 783 (5th Cir. 1975);
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Indus. Towel & Unif. Serv., a Div. of Cavalier Indus., Inc., 195 NLRB 1121 (1972); NLRB v.
Penn Cork & Closures, Inc., 376 F.2d 52 (2d Cir. 1967).
IV.
Ohlendorf and Adams separately argue that the union breached its duty of fair
representation under § 9(a) of the National Labor Relations Act. 29 U.S.C. § 159. To prove
such a claim, the employees must show that the union’s conduct was “arbitrary, discriminatory,
or in bad faith.” Vaca v. Sipes, 386 U.S. 171, 190 (1967). The employees claim that the union’s
enforcement of the window-period and certified-mail requirements satisfies that standard. One
feature of the union’s conduct, we must acknowledge, is head scratching. Ohlendorf sent his
revocation to the union on June 6, 2016, while Adams sent hers on July 14, 2016. Under their
authorization forms, Ohlendorf had between July 2–17, 2016 to revoke his authorization, and
Adams had between April 14–29, 2017. We can appreciate why the union might refuse to credit
a late revocation. But it makes much less sense to refuse to credit a revocation sent in too early:
Why refuse to credit the revocation for the next open period?
Be that as it may, we cannot say that the employees have shown arbitrariness or bad faith.
“[A] union’s actions are arbitrary only if, in light of the factual and legal landscape at the time of
the union’s actions, the union’s behavior is so far outside a wide range of reasonableness as to be
irrational.” Air Line Pilots Ass’n, Int’l v. O’Neill, 499 U.S. 65, 67 (1991). The problem with the
employees’ claim is that they agreed to the window-period and certified-mail requirements when
they signed the authorization form. Even if the requirements may seem burdensome, no one
forced the employees to sign the checkoff authorizations. Having agreed to the two
requirements, they are not in a position to say that the union acted arbitrarily in enforcing them.
For like reasons, the union’s decision to enforce the requirements does not qualify as bad
faith. To demonstrate bad faith, a plaintiff must show that the union acted with an improper
intent, purpose, or motive encompassing fraud, dishonesty, and other intentionally misleading
conduct. Merritt v. Int’l Ass’n of Machinists & Aerospace Workers, 613 F.3d 609, 619 (6th Cir.
2010). The employees have not met that standard. They do not allege that the union’s decision
to enforce the requirements was misleading or a product of fraud or dishonesty. The
No. 17-1864 Ohlendorf, et al. v. United Food & Commercial
Workers Int’l Union, Local 876
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authorization form signed by each of them spelled out the requirements they would need to
follow to revoke their assignments. In holding the employees and itself to this contract, the
union did not act in bad faith.

Outcome: For these reasons, we affirm the district court’s judgment.

Plaintiff's Experts:

Defendant's Experts:

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