United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 99-3081
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Richard E. Graham, *
*
Appellant, *
* Appeal from the United States
v. * District Court for the Southern
* District of Iowa.
Contract Transportation, Inc.; *
James Nible; Jeane M. Nible; *
Concentra Managed Care *
Services, Inc.; Concentra Health *
Services, Inc.; and W. Thomas *
Fogarty, *
*
Appellees. *
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Submitted: March 16, 2000
Filed: August 11, 2000
___________
Before McMILLIAN, FLOYD R. GIBSON,1 and MORRIS SHEPPARD ARNOLD,
Circuit Judges.
___________
MORRIS SHEPPARD ARNOLD, Circuit Judge.
1
Complications from an automobile accident have prevented Judge Gibson from
reviewing this opinion prior to its being filed.
Richard Graham filed a complaint against the defendants, asserting several
state-law claims arising out of an employment dispute between him and his employer,
Contract Transportation (CT). The district court granted summary judgment to all of
the defendants on the ground that Mr. Graham's claims were preempted by § 301 of the
Labor Management Relations Act of 1947, see 29 U.S.C. § 185(a). We affirm in part
and reverse and remand in part.
I.
When Mr. Graham, a truck driver, was required to take a random drug test by
his employer, he tested positively for methamphetamine and was fired. After he
learned that his drug test had not been conducted in accordance with the regulations of
the U.S. Department of Transportation, he brought the discrepancies to the attention
of a doctor at the testing center, who ordered the positive test result expunged.
Mr. Graham then resumed his employment with CT. After CT asked the testing center
why the positive test result had been expunged, the administrator of the center reviewed
Mr. Graham's file and determined that the doctor who had canceled the test result had
lacked the authority to do so. Mr. Graham's positive test result was reinstated, and he
was again terminated from his job.
Following his termination, Mr. Graham filed a claim for unemployment benefits
and was awarded those benefits in spite of CT's opposition. Mr. Graham also grieved
his discharge pursuant to a collective bargaining agreement (CBA), but the arbitrator
denied the claim. Mr. Graham then filed this lawsuit in state court. CT removed the
case to federal district court, which ruled that Mr. Graham's claims were preempted by
§ 301 of the Labor Management Relations Act, see 29 U.S.C. § 185(a). The district
court then noted that the claims had not been brought within the six-month statute of
limitations that governs § 301 actions, see 29 U.S.C. § 160(b), and awarded summary
judgment to the defendants on that ground.
On appeal, Mr. Graham contends that three of his claims, namely, tortious
discharge, defamation per se, and defamation per quod, are not in fact preempted by
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§ 301, and therefore were not untimely. He concedes that these claims would be
untimely if they are in fact preempted by § 301, and he does not contest the adverse
summary judgment on his other claims.
II.
Iowa law provides a cause of action for tortious discharge when a matter that
violates public policy is determinative in an employer's decision to take adverse action
against an employee. See Teachout v. Forest City Community School District, 584
N.W.2d 296, 301-02 (Iowa 1998). The district court, in holding that the claim was
preempted under § 301, relied on a case from the Ninth Circuit that stated that "a claim
that a discharge violates public policy 'is preempted ... if it is not based on any genuine
state public policy.' " Jackson v. Southern California Gas Co., 881 F.2d 638, 643-44
(9th Cir. 1989), quoting Young v. Anthony's Fish Grottos, Inc., 830 F.2d 993, 1002
(9th Cir. 1987). Although we do not think that a finding that no recognized public
policy is involved in a claim leads logically to a conclusion that that claim is preempted,
we think that CT was entitled to summary judgment on this claim on the merits.
Although Iowa courts have recognized a so-called "public policy" exception to
the general rule that an employee at will may be terminated for any reason or for no
reason at all, see Springer v. Weeks and Leo Co., Inc., 429 N.W.2d 558, 558-59 (Iowa
1988), they have stated their "strong support of the at-will presumption," Anderson v.
Douglas and Lomason Co., 540 N.W.2d 277, 282 (Iowa 1995), and consequently have
interpreted the exception "narrow[ly]," id. Iowa courts have recognized tortious
discharge claims only when the "termination of the employee 'is in retaliation for
performing an important and socially desirable act, exercising a statutory right, or
refusing to commit an unlawful act.' " Borschel v. City of Perry, 512 N.W.2d 565, 567
(Iowa 1994), quoting 82 Am. Jur. 2d Wrongful Discharge § 14, at 687 (1992).
Mr. Graham contends, first, that he was terminated as the result of a drug test
that did not comport with the regulations set forth by the U.S. Department of
Transportation. See 49 C.F.R. §§ 40.21-40.33. Although federal law can "serve as
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an appropriate source for state public policy," Smuck v. National Management Corp.,
540 N.W.2d 669, 672 (Iowa Ct. App. 1995), we do not believe that the Iowa courts
would hold that Mr. Graham can sustain an action on the facts in this case.
If Mr. Graham's claim against his employer was that he had been discharged
because he had insisted on having a drug test that complied with federal law, his
complaint might well have survived summary judgment. But that is not his claim. We
think, instead, that the gravamen of Mr. Graham's complaint is that CT relied on an
improperly conducted drug test to terminate him, which constitutes, at most, a negligent
discharge. The Iowa Supreme Court has explicitly rejected the creation of a cause of
action for negligent discharge, finding that imposing such a duty of care on employers
"would radically alter the long recognized doctrine allowing discharge for any reason
or no reason at all," Huegerich v. IBP, Inc., 547 N.W.2d 216, 220 (Iowa 1996). It is,
of course, the public policy of Iowa that no one should act negligently, as demonstrated
in a long line of cases and in numerous statutes, see, e.g., Wiersgalla v. Garrett, 486
N.W.2d 290, 292-93 (Iowa 1992). But only a play on words can transform every
negligent discharge into a tort. See Huegerich, 547 N.W.2d at 220.
Mr. Graham also maintains that he was terminated in retaliation for seeking
unemployment benefits. This theory was not raised in either Mr. Graham's complaint
or his opposition to summary judgment below, and we agree with CT that Mr. Graham
may not raise it for the first time on appeal. See Berg v. Norand Corp., 169 F.3d 1140,
1145 (8th Cir. 1999), cert. denied, 120 S. Ct. 174 (1999). We conclude, therefore, that
Mr. Graham has failed to state a claim for tortious discharge cognizable under Iowa
law, and that the defendants are entitled to summary judgment on this claim on the
merits.
III.
Mr. Graham also claimed that the defendants made statements to third persons,
including prospective employers and members of the state agency processing his
unemployment benefits claim, that amounted to defamation per se and defamation per
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quod. The district court found that both of these claims were preempted by § 301,
because the allegedly false accusations "related to a dispute in the workplace
surrounding Graham's termination under the 'just cause' provision of the CBA."
As a general matter, § 301 preempts a claim if the claim is " 'founded directly on
rights created by [the CBA],' " Lingle v. Norge Division of Magic Chef, Inc., 486 U.S.
399, 410 n.10 (1988), quoting Caterpillar Inc. v. Williams, 482 U.S. 386, 394 n.5
(1987), or if a resolution of the claim is " 'substantially dependent on analysis of [the
CBA],' " Lingle, 486 U.S. at 410 n.10, quoting International Brotherhood of Electrical
Workers, AFL-CIO v. Hechler, 481 U.S. 851, 859 n.3 (1987). We think that our
decision in Luecke v. Schnucks Markets, Inc., 85 F.3d 356, 360 (8th Cir. 1996), cert.
denied, 519 U.S. 1011 (1996), makes it clear that a claim is not preempted simply
because it relates to a dispute in the workplace. In Luecke, 85 F.3d at 358, an
employee sued, alleging defamation resulting from his employer's dissemination of false
information about the employee's refusal to take a drug test that a CBA mandated. We
rejected the employer's argument that § 301 preempted the employee's claim,
notwithstanding the fact that the claim involved an event in the workplace. In that case,
as here, the complaint did not attack the employer's "right to require drug tests," id. at
360, but instead challenged the employer's "dissemination to others of supposedly false
information," id.
Mr. Graham's defamation claim does not rely on any rights conferred by the
CBA. He is instead availing himself of a right created by state law (namely, to be free
from false and harmful statements made about him to others), which is a right that is
independent of any CBA. See Lingle, 486 U.S. at 407, and Hawaiian Airlines, Inc. v.
Norris, 512 U.S. 246, 258 (1994) (denying preemption where the only source of the
right respondent asserts is state tort law).
Nor has our examination of the CBA revealed any clause that would have to be
interpreted in order to evaluate the defamation claims. The defendants call our
attention to the provisions governing the grievance process and termination for "just
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cause," but we do not believe that either of these provisions is related to Mr. Graham's
defamation claims. Mr. Graham does not challenge the fact that he could have been
discharged for "just cause" for using methamphetamine. Indeed, Mr. Graham's
defamation claims do not challenge his discharge at all. Instead, Mr. Graham
complains that the defendants deliberately and falsely indicated to the state agency and
to prospective employers that he had used methamphetamine. The key inquiry for a
fact finder in this case, namely, whether the defendants deliberately lied about
Mr. Graham using drugs, is a "purely factual" question, Meyer v. Schnucks Markets,
Inc., 163 F.3d 1048, 1050 (8th Cir. 1998), that requires no analysis of the meaning of
the CBA. See also Hanks v. General Motors Corp., 906 F.2d 341, 344 (8th Cir.
1990).
We believe that the facts of this case serve to distinguish it from Johnson v.
Anheuser Busch, Inc., 876 F.2d 620, 624 (8th Cir. 1989), upon which Mr. Graham
relies, and from Gore v. Trans World Airlines, 210 F.2d 944 (8th Cir. 2000), which we
recently decided. In both of those cases, we found that claims of slander based on
statements made during the course of an employer's investigation of employee
misconduct were preempted because they were " 'inextricably intertwined with
consideration of the terms of the labor contract,' " Johnson, 876 F.2d at 623, quoting
Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 213 (1985); see also Gore, 210 F.3d at
950-51. In our case, however, the allegedly defamatory statements included statements
that were made after the investigation and arbitration process had been completed, to
third parties outside the employment relationship between Mr. Graham and CT (i.e.,
the state agency and prospective employers).
We are aware that certain of our statements in Johnson might be taken to suggest
that a defamation claim should always be considered "inextricably intertwined" with
the terms of the labor contract, and therefore preempted, if it is based on statements
that relate to a dispute in the workplace that is subject to grievance procedures under
a CBA. See Johnson, 876 F.2d at 624. As we noted in Meyer, 163 F.3d at 1050-51,
however, a separate line of cases has developed in this circuit that applies federal
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preemption more narrowly and requires that a claim be grounded on the rights
established by a CBA, or substantially dependent on an analysis of a CBA, before it
may be found to be preempted. See also Humphrey v. Sequentia, Inc., 58 F.3d 1238,
1244 (8th Cir. 1995).
When faced with conflicting precedents we are free to choose which line of
cases to follow, see Kostelec v. State Farm Fire and Casualty Co., 64 F.3d 1220, 1228
n.8 (8th Cir. 1995), and we think that the narrower approach to preemption, as outlined
in Meyer, is more faithful to Supreme Court precedent. See Livadas v. Bradshaw, 512
U.S. 107, 123 (1994) ("[i]n Lueck and in Lingle ... we underscored the point that § 301
cannot be read broadly to pre-empt nonnegotiable rights conferred ... as a matter of
state law"), and Lingle, 486 U.S. at 409-10.
The defendants contend that if claims such as Mr. Graham's are not preempted
arbitration will lose its intended effectiveness. We disagree. Arbitration remains the
method for settling disputes that are based on the rights, duties, and processes set forth
in a CBA. Expansion of the arbitration mechanism's coverage beyond these matters
does not accord with the purpose of § 301: "[I]t would be inconsistent with
congressional intent under [§ 301] to pre-empt state rules that proscribe conduct, or
establish rights and obligations, independent of a labor contract." Lueck, 471 U.S. at
212.
IV.
The district court's grant of summary judgment to the defendants is affirmed
with regard to Mr. Graham's claim of tortious discharge, and reversed with regard to
his claims of defamation per se and defamation per quod. We remand the case to the
district court for consideration of the merits of the defendants' remaining summary
judgment motions.
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A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
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