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International Brotherhood of Electrical Workers, Local 481 v. Sign-Craft, Inc.

Citations: 851 F.2d 910; 128 L.R.R.M. (BNA) 3070; 1988 U.S. App. LEXIS 9606; 1988 WL 72197Docket: 87-2061

Court: Court of Appeals for the Seventh Circuit; July 5, 1988; Federal Appellate Court

Narrative Opinion Summary

This case involves a dispute between a union and a company over the repudiation of a collective bargaining agreement. The union filed an unfair labor practice charge against the company, which was dismissed by the NLRB. Subsequently, the union initiated a lawsuit under Section 301(a) of the LMRA, seeking declaratory and injunctive relief, and damages for breach of contract. The company moved for summary judgment, arguing the court lacked subject matter jurisdiction. The district court agreed, concluding that the core issue was the validity of the collective bargaining agreement, not its violation, and dismissed the case without prejudice. The court applied precedent from NDK Corp. v. Local 1550, which does not support jurisdiction for contract validity issues absent a violation claim. The union's appeal contends that the court should have exercised jurisdiction, emphasizing allegations of a breach. A dissenting opinion argued that the district court erred by focusing on the contract's validity instead of the alleged breach, suggesting the court had jurisdiction under Section 301. The decision was affirmed, with the majority opinion criticized for extending circuit law contrary to decisions in other circuits.

Legal Issues Addressed

Allegations of Breach for Jurisdiction

Application: The dissent argued that the Union's allegations of breach should establish jurisdiction under Section 301, as federal jurisdiction exists with an alleged breach of a labor contract.

Reasoning: The plaintiffs are alleging a breach of contract, which is consistent with precedent in International Union of Operating Eng'rs, Local 150 v. G. Bliudzius Contractors, Inc. and Mogge v. District No. 8.

Jurisdiction under Section 301 of the LMRA

Application: The court determined it lacked jurisdiction because the primary issue was the validity of the collective bargaining agreement, not a violation of it.

Reasoning: The district court found it had no subject matter jurisdiction as the main issue was one of contract validity, not a violation of an agreement.

Procedural Precedent in Labor Disputes

Application: The court relied on precedent from NDK Corporation v. Local 1550, which established that Section 301 does not provide jurisdiction for validity determinations of contracts.

Reasoning: The district court properly declined jurisdiction based on precedent from NDK Corp. v. Local 1550, where the plaintiff sought rescission, not enforcement, of a labor contract.

Validity vs. Violation in Labor Contract Disputes

Application: The court emphasized that Section 301(a) only grants jurisdiction for contract violation suits, not for validity determinations where that is the primary issue.

Reasoning: Section 301 only grants jurisdiction for contract violation suits, not for validity determinations where that is the primary issue.