KIMBA M. WOOD, United States District Judge.
John Krakowski, Kevin Homer, and M. Alicia Sikes (together, the "Appellants") are pilots, currently employed by American Airlines, Inc. ("American") and represented by the Allied Pilots Association ("APA"). They were employed by Trans World America ("TWA") until it merged with American. In the adversary bankruptcy proceeding below, they bring several claims arising from American's and APA's treatment of former TWA pilots during and after the American-TWA merger.
In a pair of decisions, the Bankruptcy Court, Hon. Sean H. Lane, dismissed all of Appellants' claims, as follows: (1) a breach of contract claim against American, for failure to state a claim; (2) a breach of duty of fair representation claim against APA, as procedurally barred, under the law of the case doctrine, by the Bankruptcy Court's prior dismissal of an identical claim in a separate adversary proceeding between the same parties; and (3) a claim that American colluded in APA's breach of the duty of fair representation, because plaintiffs did not have a viable duty of fair representation claim, and, in any event, failed to adequately allege collusion.
Appellants now appeal from the Bankruptcy Court's orders dismissing their claims. For the following reasons, the decisions of the Bankruptcy Court are AFFIRMED.
Appellants are former TWA pilots who currently fly for American. (Second Amended Complaint ("SAC") ¶ 8.) In April 2001, American acquired TWA's assets. (Id. ¶ 16.) In November 2001, American and APA executed a document called "Supplement CC", which merged the former TWA pilots into American's pilot seniority list. (Id. ¶ 17.) Under Supplement CC, former TWA pilots were integrated into American's seniority list with none or a fraction of the seniority they had earned at TWA. (Id. ¶¶ 18-19.) To compensate the former TWA pilots for their loss of seniority, Supplement CC established what the parties call a "protective fence" in TWA's former hub of St. Louis, Missouri. The "fence" guaranteed a certain number of captain and first officer positions for St. Louis-based former TWA pilots, and thus permitted former TWA pilots to fly St. Louis-based routes that would otherwise be unavailable due to their reduced seniority. (Id. ¶¶ 19-20.)
Supplement CC was a supplement to American's then-existing collective bargaining agreement with APA (the "Old CBA"). When American and APA agreed to Supplement CC, the former TWA pilots were not represented by APA. They were
Roughly a decade later, in November 2011, American filed for bankruptcy. (Id. ¶ 34.) As part of the bankruptcy proceedings, the Bankruptcy Court granted American's request to abrogate the Old CBA. (Id. ¶ 36.) The Old CBA and its supplements, including Supplement CC, became null and void as of September 5, 2012. (Id. ¶ 37.)
In the course of negotiating a replacement collective bargaining agreement, American and APA signed a letter of agreement called "LOA 12-05".
Appellants have brought many cases against American and APA, several of which are now adversary proceedings in American's bankruptcy case. The parties refer to these adversary proceedings, chronologically by date of filing, as Krakowski I and Krakowski II. The earlier case is Krakowski I. See Krakowski v. Am. Airlines, Inc. (In re AMR Corp.), Case No. 11-15463, Adv. Proc. No. 13-01238 (Bankr. S.D.N.Y.) [hereinafter Krakowski I]. The instant matter is known as Krakowski II. See Krakowski v. Am. Airlines, Inc. (In re AMR Corp.), Case No. 11-15463, Adv. Proc. No. 14-01920 (Bankr. S.D.N.Y.) [hereinafter Krakowski II].
Krakowski I was initially filed in the Eastern District of Missouri in 2012. See Krakowski I, 927 F.Supp.2d 769, 771 (E.D. Mo. 2013). It was transferred to the Bankruptcy Court for the Southern District of New York on March 4, 2013. Id. at 776.
In Krakowski I, Appellants claimed APA breached its duty of fair representation to former TWA pilots by agreeing, in the New CBA, to compensate former TWA pilots for the loss of the protective "fence" via an arbitration procedure that could not modify the unfair seniority list established by Supplement CC. Appellants also claimed American colluded in this breach. See Krakowski I, 199 L.R.R.M. (BNA)
On June 3, 2014, the Bankruptcy Court dismissed the complaint for failure to state a claim, reasoning that APA's agreement not to modify the seniority list when negotiating the New CBA did not breach APA's duty of fair representation. See id. On October 2, 2019, the District Court, Hon. Lewis Kaplan, affirmed the Bankruptcy Court's dismissal of the complaint.
The instant case, Krakowski II, was initially filed in the Eastern District of Missouri on May 1, 2013. (App'x at 9-19). Appellants filed their First Amended Complaint six days later, on May 7, 2013. (First Amended Complaint ("FAC"), App'x at 20-31.). Thereafter, the case was transferred to the Southern District of New York on motion of the defendants, where it was referred to the Bankruptcy Court. (App'x at 8.)
The First Amended Complaint in Krakowski II made three claims. In Count One, Appellants alleged that American breached the New CBA by placing former TWA pilots on American's seniority list according to Supplement CC, rather than crediting them for seniority they earned at TWA. (FAC ¶¶ 36-45.) In Count Two, Appellants alleged that APA breached its duty of fair representation by agreeing to continue to use the seniority list established by Supplement CC, which violated the New CBA; was unfair to former TWA pilots; and treated former TWA pilots worse than the pilots of other airlines acquired by American. (Id. ¶¶ 43-50.) In Count Three, Appellants alleged that American colluded with APA in APA's breach of the duty of fair representation. (FAC ¶ 52-54.)
On September 22, 2015, the Bankruptcy Court partially granted Appellees' motions to dismiss the First Amended Complaint. Krakowski II, 538 B.R. 213, 215 (Bankr. S.D.N.Y. 2015). The Bankruptcy Court dismissed Count One, the breach of contract claim against American, for failure to state a claim, reasoning that Appellants' argument was incompatible with the plain language of the New CBA. Id. at 218-22. The Bankruptcy Court permitted Appellants to proceed with Count Two, the duty of fair representation claim against APA, but only to the extent the claim was based on the alleged unfairness of the seniority list established by Supplement CC, and only as it pertained to the narrow time period after the Old CBA was abrogated but before the New CBA was executed.
On October 22, 2015, Appellants filed their Second Amended Complaint. (App'x
Appellants appealed the Bankruptcy Court's dismissals of the First Amended Complaint and Second Amended Complaint to this Court on April 28, 2017. (App'x at 414-16.)
When hearing an appeal from an order of the Bankruptcy Court, this Court reviews the Bankruptcy Court's findings of law de novo and its findings of fact for clear error. See In re Bayshore Wire Prods. Corp., 209 F.3d 100, 103 (2d Cir. 2000). The Bankruptcy Court's decisions regarding the management of its docket are reviewed for abuse of discretion. See In re Fletcher Intern. Ltd., 536 B.R. 551, 557 (S.D.N.Y. 2015) (Sullivan, J.). This Court may affirm on any ground supported by the record, not just the ones relied upon by the Bankruptcy Court. See Freeman v. Journal Register Co., 452 B.R. 367, 369 (S.D.N.Y. 2010) (Koeltl, J.).
A complaint must be dismissed if it fails to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6); see also Fed. R. Bankr. P. 7012(b). "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Aschroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955).
Where a complaint alleges that a union has violated its duty of fair representation, the District Court has a special duty to "construe complaints so as to avoid dismissals and ... give plaintiffs the opportunity to file supplemental pleadings unless it appears beyond doubt that a good cause of action cannot be stated." Eatz v. DME Unit of Local Union Number 3 of Int'l. Bhd. of Elec. Workers, 794 F.2d 29, 34 (2d Cir. 1986).
"In considering a motion to dismiss for failure to state a claim, a district court must limit itself to the facts stated in the complaint, documents attached to the complaint as exhibits and documents incorporated by reference in the complaint." Hoyden
The Bankruptcy Court properly dismissed all of Appellants' claims because none states a claim upon which relief could be granted. Appellants' claims are reviewed in the order in which they were initially pled.
In Count One of the First Amended Complaint, Appellants claim American breached the New CBA by placing former TWA pilots on the seniority list established by Supplement CC. According to Appellants, in order to comply with the New CBA, American should have placed the former TWA pilots on its seniority list according to the time they started working at TWA. (FAC ¶¶ 36-39.) The Bankruptcy Court dismissed this claim, holding that it "is inconsistent with the plain language of the New CBA." Krakowski II, 538 B.R. at 218. Appellants now argue the Bankruptcy Court erroneously failed to consider American's general practices when interpreting the New CBA. (Appellants' Opening Brief ("Op. Br.") at 22-24, ECF No. 6.) Their position is unpersuasive.
"When courts interpret CBAs, traditional rules of contract interpretation apply as long as they are consistent with federal labor policies. When provisions in the agreement are unambiguous, they must be given effect as written. Only when provisions are ambiguous may courts look to extrinsic factors—such as bargaining history, past practices, and other provisions in the CBA—to interpret the language in question." Aeronautical Indus. Lodge 91 of Int'l. Ass'n of Machinists and Aerospace Workers v. United Techs. Corp., 230 F.3d 569, 576 (2d Cir. 2000) (citations omitted).
Appellants argue the New CBA required American to place the former TWA pilots on its seniority list according to their "Occupational Date," a date that Appellants claim is tied to the time the former TWA pilots started working at TWA. Appellants allege that Section 2(AA) of the New CBA requires a pilot's placement on American's seniority date be determined by his or her "Occupational Date." (FAC ¶ 23.) They allege that, under American's "general practice," a pilot's "Occupational Date" is simply his or her date of hire, plus a period of about seven weeks. (Id. ¶ 22.) They further claim "American has consistently acknowledged each former TWA pilot's `Date of Hire' as the date they were hired by TWA." (Id. ¶ 20.) Thus, Appellants conclude that that American breached the New CBA when it failed to base the former TWA pilots' seniority on the dates they started working at TWA, and instead placed them on its seniority list according to Supplement CC. (Id. ¶ 25.)
As the Bankruptcy Court correctly determined, however, this was the very outcome that the New CBA required. Section 13 of the New CBA sets out the New CBA's general seniority rules, but also provides that "certain other rules in this Agreement stipulating specific methods and procedures of applying system seniority shall govern such application of system seniority." (Appendix to APA's Brief ("APA App'x") at 4.) Thus, the parties agreed that, whatever the New CBA's general seniority rules were, they would be trumped by any other, more specific seniority provisions in the New CBA. One such rule was outlined in LOA 12-05, which was incorporated into the New CBA. (Appendix to American's Brief ("American App'x") at SA000008, 10.) LOA
Thus, rather than breaching the New CBA, American followed the New CBA's express provisions when it continued to use the seniority list placements established by Supplement CC, rather than ranking the former TWA pilots according to their Occupational Dates or Dates of Hire. Even though the Bankruptcy Court made this precise point when dismissing Count One of the First Amended Complaint, Appellants' Opening Brief makes no mention whatsoever of LOA 12-05. Thus, Appellants fail to identify any error in the Bankruptcy Court's dismissal of their breach of contract claim.
Even if LOA 12-05 did not trump the general seniority provisions of the New CBA, Appellants' claims, based on those general provisions, would still fail. According to Appellants, American has "consistently acknowledged" that former TWA pilots' "Date of Hire" is the date the pilot was hired by TWA, and American's "general practice" was that a pilot's Occupational Date is a date some 45 to 49 days after the Date of Hire. (FAC §§ 20, 22.) The New CBA, however, states that a pilot's Occupational Date is "the date a pilot is first scheduled to complete initial new hire training with the Company." (APA App'x at 3.) The New CBA defines "Company" as "American Airlines, Inc." (Id. at 2.) Moreover, the New CBA defines "date of hire" as "[t]he first day as an AA pilot." (American App'x at SA000027.)
These provisions unambiguously tie seniority to a pilot's start at American, not at any other airline. The Court cannot look to extrinsic evidence, such as American's past or general practices, to interpret their meaning. See Aeronautical Indus. Dist. Lodge 91, 230 F.3d at 576. Thus, even if LOA 12-05 did not govern the seniority of former TWA pilots (which it does), American would not have breached the New CBA by failing to place pilots on its seniority list according to their start dates at TWA.
Appellants argue that the New CBA's seniority rules are ambiguous as applied to them, such that extrinsic evidence may be used to discern their meaning. First, they argue the New CBA's general seniority rules must have been ambiguous because American did not follow them; that is, former TWA pilots were not placed on the seniority list according to their start date at American. (Op. Br. at 24.) But the manner in which American implemented the New CBA is simply more extrinsic evidence, rather than evidence of ambiguity in the language of the New CBA. Even if this extrinsic evidence could be considered, it would not be persuasive. American's reason for failing to follow the general seniority rules of the New CBA was not that those rules were ambiguous; rather, it was simply that, per LOA 12-05, American agreed not to apply those rules to former TWA pilots.
Appellants also argue that the CBA's requirement that Occupational Date is tied to a pilot's "new hire training" is ambiguous as applied to former TWA pilots because, as experienced pilots, they never underwent "new hire training." (Appellants' Reply Brief at 16, ECF No. 16). But this fact was not pled, and Appellants do not contest the Bankruptcy Court's refusal
Accordingly, even if the New CBA's general seniority provisions are applicable to former TWA pilots—and they are not—Appellants fail to state a claim for breach of contract by arguing that American failed to place them on its seniority list in accordance with an Occupational Date based on their first day at TWA.
In the Second Amended Complaint, Plaintiffs allege that APA breached its duty of fair representation to the former TWA pilots, and that American was complicit in that breach. (SAC ¶¶ 42, 44.) The Bankruptcy Court's dismissal of these claims was sound.
Appellants claim APA violated its duty of fair representation to the former TWA pilots by agreeing, in the New CBA, to continue to use the seniority list established by Supplement CC but without the protective "fence" in St. Louis. (Op. Br. 16-19.) This claim is barred by both the rule against duplicative litigation and the law of the case doctrine.
As the Bankruptcy Court explained in its September 22, 2015 Order, Appellants' duty of fair representation claims survived dismissal only to the extent they addressed a narrow subject: whether APA breached its duty of fair representation by continuing to use the allegedly unfair seniority list established by Supplement CC in the time period between the abrogation of the Old CBA and the implementation of the New CBA. See Krakowski II, 538 B.R. at 223-24. To the extent the claim addressed APA's agreement to the New CBA, it would be duplicative
This claim, as pled, is barred by the rule against duplicative litigation, which permits a federal court to "stay or dismiss a suit that is duplicative of another federal court suit." Sacerdote v. Cammack Larhette Advisors, LLC, 939 F.3d 498, 505 (2d Cir. 2019) (citing Curtis v. Citibank, N.A., 226 F.3d 133, 138 (2d Cir. 2000)). This is because "plaintiffs may not file duplicative complaints in order to expand their legal rights." Curtis, 226 F.3d at 140.
In addition to being barred by the rule against duplicative litigation, Appellants' claims alternatively fail under the law of the case doctrine. This is because the Krakowski I court considered and dismissed the claim that Appellants duplicate in the instant proceedings. The law of the case doctrine provides that "[w]hen a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case." Arizona v. California, 460 U.S. 605, 618, 103 S.Ct. 1382, 75 L.Ed.2d 318 (1983). In Krakowski I, the Bankruptcy Court dismissed Appellants' duty of fair representation claim against APA, reasoning that APA had no obligation to prioritize the former TWA pilots over other American pilots in the "zero sum game" of seniority when it negotiated the New CBA. See Krakowski I, 2014 WL 2508729, at *4; see also Krakowski I, 536 B.R. at 371-72 (confirming dismissal of Appellants' duty of fair representation claim). Although Krakowski I is, of course, a different adversary proceeding than the one now before the court, "[c]ourts have held that the law-of-the-case doctrine applies to different adversary proceedings filed within the same main bankruptcy case." In re Motors Liquidation Co., 590 B.R. 39, 62 (S.D.N.Y. 2018) (Furman, J.) (quotation marks omitted); see also In re PCH Assocs., 949 F.2d 585, 592 (2d Cir. 1991) (noting that law of the case doctrine "has application to different lawsuits between the same parties"). Thus, the Bankruptcy Court's earlier ruling
Because Appellants fail to state a claim that APA breached its duty of fair representation, they necessarily fail to state a claim that American colluded in any such breach. See Flight Attendants in Reunion v. Am. Airlines, Inc., 813 F.3d 468, 475 (2d Cir. 2016).
The Bankruptcy Court's partial dismissal of the First Amended Complaint and dismissal of the Second Amended Complaint are AFFIRMED.
SO ORDERED.