United States District Court, D. Nevada
BOARD OF TRUSTEES OF THE GLAZING HEALTH AND WELFARE FUND, et al., Plaintiffs,
ALEUT FACILITIES SUPPORT SERVICES, et al., Defendants.
ORDER GRANTING MOTION TO DISMISS FOR LACK OF SUBJECT
MATTER JURISDICTION (ECF NO. 33)
P. GORDON UNITED STATES DISTRICT JUDGE
are the boards of trustees of various collectively bargained
multi-employer employee benefit plans (the
“Trusts”), which are subject to the Employee
Retirement Income Security Act (ERISA). ECF No. 1 at 5. The
Trusts previously filed a lawsuit in this court against
Accuracy Glass & Mirror Company, Inc. under ERISA and the
Labor Management Relations Act (LMRA). The Trusts alleged in
that case that Accuracy had failed to make contributions to
the Trusts as required under a collectively bargained
agreement between the International Union of Painters and
Allied Trades, District Council 15; Glaziers, Architectural
Metal and Glassworkers' Local Union 2001; and the Glazing
Contractors' Association of Nevada (of which Accuracy was
a member). Id. at 11-12. The Trusts prevailed in
that action, with the court entering judgment in their favor
on May 27, 2016. Id. at 12.
Trusts then brought this action to recover from other parties
contributions that Accuracy failed to pay for a different
time period than reflected in the prior judgment. For
example, defendant Western Surety had issued a bond to
Accuracy. Id. at 12-13. The Trusts contend Western
must pay on the bond for Accuracy's delinquencies.
Id. at 13. The other defendants are either (1)
companies who hired Accuracy to perform the work that gave
rise to Accuracy's indebtedness or (2) companies who
issued bonds to the companies who hired Accuracy.
Id. at 13-14. Accuracy is not a defendant in this
case. The Trusts assert state law claims against the
defendants for payment of labor indebtedness under Nevada
Revised Statutes § 608.150 and payment on the bonds
under Nevada Revised Statutes § 624.273. Id. at
City Center Holdings, LLC and Mandarin Oriental Las Vegas,
LLC move to dismiss the case for lack of subject matter
jurisdiction. These defendants argue that although the
complaint mentions ERISA and the LMRA as jurisdictional
bases, it does not allege that any defendant has liability
under ERISA or a labor contract with the plaintiffs. Rather,
these defendants argue, the only claims asserted are state
law claims. The defendants contend that subject matter
jurisdiction in the complaint is thus predicated solely on
supplemental jurisdiction based on the prior lawsuit against
Accuracy. But, they contend, without at least one claim over
which the court has subject matter jurisdiction in this case
(as opposed to the prior action against Accuracy), the court
cannot exercise supplemental jurisdiction.
Trusts respond by asserting that under § 608.150, the
defendants are original promisors on the obligations giving
rise to Accuracy's indebtedness. The Trusts also argue
that supplemental jurisdiction is appropriate because this
case is part of the same case or controversy as the Accuracy
litigation. Finally, the Trusts contend that dismissal would
not be fair or efficient because the case was filed against
more than 50 defendants, only two of whom are moving to
dismiss, and has proceeded as if the court had jurisdiction.
28 U.S.C. § 1331 provides for original jurisdiction over
“all civil actions arising under the Constitution,
laws, or treaties of the United States.” There are
three potential grounds for federal question jurisdiction:
(1) the plaintiff has asserted a federal claim in the
complaint, meaning that federal law creates the cause of
action; (2) under the artful pleading doctrine, one or more
of the plaintiff's state law claims should be
recharacterized as a federal claim; or (3) one or more of the
plaintiff's state law claims “necessarily turn[s]
on the construction of a substantial, disputed federal
question.” Rains v. Criterion Sys., Inc., 80
F.3d 339, 343 (9th Cir. 1996).
complaint, the Trusts assert jurisdiction in this court under
ERISA and the LMRA, with supplemental jurisdiction over the
state law claims under 28 U.S.C. § 1367(a). ECF No. 1 at
4. As the party seeking to invoke federal jurisdiction, the
Trusts bear the burden of establishing it exists.
Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S.
375, 377 (1994). In their response brief, the Trusts do not
explain how jurisdiction is predicated on the LMRA, so they
have not met their burden of showing I have jurisdiction on
that basis. I address below the parties' arguments
regarding § 608.150, ERISA, and supplemental
Trusts argue that under § 608.150, an original
contractor is liable for the indebtedness for labor incurred
by its subcontractors. It is unclear what impact the Trusts
believe this has on subject matter jurisdiction. If they are
asserting that the defendants are liable as ERISA fiduciaries
as a result of the operation of § 608.150 so that their
claim arises under ERISA, then I disagree. Section 608.150
creates a “state law obligation to answer for
[Accuracy's] debts.” Trustees of Constr. Indus.
& Laborers Health & Welfare Trust v. Desert Valley
Landscape & Maint., Inc., 333 F.3d 923, 925 (9th
Cir. 2003) (holding district court properly exercised
supplemental jurisdiction over state law claim under §
608.150 where joined with an ERISA claim against the
subcontractor that owed the ERISA contributions). The Trusts
would have no means to collect from the defendants in this
action but for Nevada state law. Accordingly, the Trusts'
§ 608.150 claim asserts a cause of action that was
created by state law.
Trusts agree that § 608.150 claims are not preempted by
ERISA. See ECF No. 42 at 6-7; see also United
Ass'n of Journeymen & Apprentices of Plumbing &
Pipefitting Indus. of U.S. & Canada AFL-CIO, Local No.
525 v. Grove Inc., 105 F.Supp.2d 1129, 1130 (D. Nev.
2000) (stating a cause of action under § 608.150 seeks
to enforce an “independent obligation created under the
statute, ” and thus is not preempted by ERISA). Thus,
the Trusts' § 608.150 claim should not be
recharacterized as a federal claim.
the Trusts do not argue that their § 608.150 claim
necessarily turns on the construction of a substantial,
disputed federal question. Accordingly, the Trusts have not
met their burden of showing that their § 608.150 claim
gives rise to federal question subject matter jurisdiction.
their response, the Trusts appear to concede that they assert
subject matter jurisdiction on the theory that I should
exercise supplemental jurisdiction based on the prior, closed
case against Accuracy. However, controlling authority
precludes me from doing so.
jurisdiction must be exercised in the same action that
furnishes the basis for exercise of supplemental
jurisdiction.” Ortolf v. Silver Bar Mines,
Inc., 111 F.3d 85, 86 (9th Cir. 1997), as amended on
denial of reh'g (June 10, 1997). As explained in
Ortolf, the supplemental jurisdiction statute, 28
U.S.C. § 1367(a), extends a federal court's power to
exercise supplemental jurisdiction to “‘all other
claims that are so related to claims in the action' when
a district court has original jurisdiction ‘in any
civil action.'” Id. “The phrases
‘in any civil action' and ‘in the action'
require that supplemental jurisdiction be exercised in the
same case, not a separate or subsequent case.”
Id. at 87; cf. Herklotz v. Parkinson, 848
F.3d 894, 898 (9th Cir. 2017) (holding that a ...