Caterpillar, Inc. v. Williams
482 U.S. 386 (1987)

Annotate this Case

U.S. Supreme Court

Caterpillar, Inc. v. Williams, 482 U.S. 386 (1987)

Caterpillar, Inc. v. Williams

No. 86-526

Argued April 21, 1987

Decided June 9, 1987

482 U.S. 386

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR

THE NINTH CIRCUIT

Syllabus

Caterpillar Tractor Co. (Caterpillar) hired respondents to work at its San Leandro, California, facility in positions covered by its collective bargaining agreement with a union. Respondents eventually assumed management and other positions outside the bargaining unit, and allegedly were repeatedly assured by Caterpillar that, if the San Leandro facility ever closed, Caterpillar would employ them at other facilities. Subsequently, they were downgraded to unionized positions, but allegedly assured that the downgrades were temporary. However, Caterpillar later notified them that its San Leandro plant would close and that they would be laid off. Respondents then filed this action, based solely on state law, in a California state court, alleging that Caterpillar thereby breached their individual employment contracts. Caterpillar removed the action to Federal District Court, arguing that removal was proper because any individual employment contracts made with respondents were, as a matter of federal substantive labor law, merged into and superseded by the collective bargaining agreement. Respondents denied that they alleged any federal claim, and sought remand of the action to the state court. The Federal District Court held that removal was proper, and dismissed the case when respondents refused to amend the complaint to attempt to state a claim under § 301 of the Labor Management Relations Act, 1947, which confers federal jurisdiction as to suits for violations of collective bargaining agreements. The Court of Appeals reversed, holding that the case was improperly removed.

Held: Respondents' state law complaint for breach of the individual employment contracts is not removable to Federal District Court. Pp. 482 U. S. 391-399.

(a) The presence or absence of federal question jurisdiction that will support removal is governed by the "well-pleaded complaint rule," under which federal jurisdiction exists only when a federal question is presented on the face of the properly pleaded complaint. Ordinarily, a case may not be removed on the basis of a federal defense, including the defense of preemption, even if the defense is anticipated in the complaint, and even if both parties concede that the federal defense is the only question truly at issue. However, under the "complete preemption doctrine," which is a corollary to the well-pleaded complaint rule, once an area of state law has been completely preempted, any claim purportedly

Page 482 U. S. 387

based on that preempted state law is considered, from its inception, a federal claim, and therefore arises under federal law. Pp. 482 U. S. 391-394.

(b) Respondents' state law contract claims are not "completely preempted" § 301 claims. Section 301 governs claims founded directly on rights created by collective bargaining agreements and claims substantially dependent on analysis of such agreements. However, respondents alleged that Caterpillar breached individual employment contracts with them, and § 301 says nothing about the content or validity of such contracts. Although respondents, as bargaining unit employees at the time of the plant closing, could have brought suit under the collective agreement, they, as masters of the complaint, chose not to do so. Moreover, their complaint is not substantially dependent upon interpretation of the collective bargaining agreement. Pp. 482 U. S. 394-395.

(c) J. I. Case Co. v. NLRB,321 U. S. 332, does not support Caterpillar's contention that, when respondents returned to the collective bargaining unit, their individual employment contracts were subsumed into, or eliminated by, the collective bargaining agreement so as to be preempted by § 301. That decision does not stand for the general proposition that all individual employment contracts are inevitably superseded by a subsequent collective agreement. The fact that an employer may raise such a question in state court and might ultimately prove that the employee's claims are preempted does not establish that they are removable. Pp. 482 U. S. 395-398.

(d) There is no merit to Caterpillar's argument that § 301 preempts a state law claim when the employer raises only a defense that requires a court to interpret or apply a collective bargaining agreement, such as Caterpillar's defense claiming that, in its collective bargaining agreement, its unionized employees waived any preexisting individual employment contract rights. The presence of a federal question, even a § 301 question, in a defensive argument does not overcome the paramount policies embodied in the well-pleaded complaint rule. Pp. 482 U. S. 398-399.

786 F.2d 928, affirmed.

BRENNAN, J., delivered the opinion for a unanimous Court.

Page 482 U. S. 388

JUSTICE BRENNAN delivered the opinion of the Court.

The question for decision is whether respondents' state law complaint for breach of individual employment contracts is completely preempted by § 301 of the Labor Management Relations Act, 1947 (LMRA), 61 Stat. 156, 29 U.S.C. § 185, and therefore removable to Federal District Court.

I

At various times between 1956 and 1968, Caterpillar Tractor Company (Caterpillar) hired respondents to work at its San Leandro, California, facility. Complaint

Official Supreme Court caselaw is only found in the print version of the United States Reports. Justia caselaw is provided for general informational purposes only, and may not reflect current legal developments, verdicts or settlements. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or information linked to from this site. Please check official sources.