• Federal Labor Law Preempts Illinois Antitrust Claim
  • July 29, 2009 | Author: Michael Robert Lied
  • Law Firm: Howard & Howard Attorneys PLLC - Peoria Office
  • Ronald D. Smart, d/b/a Paschall Electric, contracted to perform electrical work for the construction of a sports complex.  Smart alleged in his Complaint that the International Brotherhood of Electrical Workers Union (“IBEW”) threatened to shut down the building project if the project owner did not employ union workers instead of Smart’s company.  The owner fired Smart and hired a union signatory company to complete the project.

    Smart filed suit and alleged that the IBEW’s tactics violated the Illinois Antitrust Act.  Smart also brought additional claims for unwarranted prosecution against the IBEW, the union’s attorney, Grant, and Grant’s firm, Schuchat, Cook & Werner.  Smart also brought claim for legal malpractice against Grant and his firm.  This article discusses only the antitrust claim.

    Defendants moved to dismiss Smart’s complaint.  The district court concluded that the state antitrust claim was preempted by the National Labor Relations Act (“NLRA”) and dismissed the Complaint.  Smart appealed.

    The court of appeals had to first decide if it had jurisdiction.  Since there was no diversity of citizenship, Smart’s complaint had to raise a federal question.  Ordinarily, a court must determine the presence of a federal question by examining only the plaintiff’s complaint.

    Smart included only state causes of action in his complaint.  The defense of federal preemption ordinarily does not provide a basis for asserting federal jurisdiction.  However, an independent corollary to the well-pleaded complaint rule is known as the “complete preemption” doctrine.  Any claim purportedly based on a completely pre-empted state law is considered to be a federal claim.

    The court of appeals concluded that Smart’s state antitrust claim was preempted by federal law.  The activities described by Smart in his complaint arguably were prohibited by section 8(b)(4) of the NLRA, which prohibits an attempt by a labor organization “to threaten, coerce, or restrain any person engaged in commerce or in an industry affecting commerce, where in either case an object thereof is…forcing or requiring any person…to cease doing business with any other person.”  This is colloquially called a secondary boycott.  With respect to injuries resulting from a secondary boycott, Congress provided a specific means to seek a remedy in federal court, 29 U.S.C. § 187.

    The court held that section 187(b) completely preempts state-law claims related to secondary boycott activities described in section 8(b)(4) of the NLRA.  The statute provides an exclusive federal cause of action for the redress of such illegal activity.  As a result, regardless of Smart’s choice to bring a claim under the Illinois Antitrust Act, he nevertheless pleaded a federal claim.

    Because Smart’s claim was completely preempted by federal law, on remand, the district court had to address that claim under 29 USC § 187.  The district court was directed to provide Smart an opportunity to amend his complaint to ensure that he properly stated a claim under the governing law.  Smart v. Local 702 International Brotherhood of Electrical Workers, 562 F.3d 798 (7th Cir. 2009).