Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 79 C 2466-John F. Grady, Judge.
Before CUDAHY, POSNER, and EASTERBROOK, Circuit Judges.
This case, before us for the second time, see 697 F.2d 771 (7th Cir. 1983), again raised interesting questions of federal jurisdiction and labor law. The railroad fired Graf in 1977, ostensibly for having falsified his employment application forms-he says really because he had filed a suit against the railroad under the Federal Employers Liability Act, 45 U.S.C. §§ 51 et seq. The collective bargaining contract between Graf's union and the railroad gave him 60 days in which to appeal his discharge, initially to a higher supervisory layer within the railroad. Graf asked Evans, the chairman of the local union, to file the appeal for him. Evans told him that he would, and later that he had filed it, but after the 60 days had run he discovered it, unfiled, in his pocket. Graf filed suit in state court. Count I of his complaint charged the railroad with having discharged him in retaliation for the FELA suit. Count II charged the union with negligent failure to press his grievance. The union removed the case to federal district court. The wonderfully obscure question of whether the union could remove the entire case by itself, on which see Thomas v. Shelton, 740 F.2d 478, 483-84 (7th Cir. 1984), and Bernstein v. Lind-Waldock & Co., 738 F.2d 179, 183 (7th Cir. 1984), was made moot by Graf's filing a brand new complaint in federal district court against both defendants after the removal of his state case, see id. at 185-86. The district judge granted the union's motion for summary judgment on Count II and then, on his own initiative, dismissed Count I; so the complaint was dismissed in its entirety.
Graf appealed. We affirmed the dismissal of Count II. Although the Railway Labor Act, 45 U.S.C. §§ 151 et seq., has been held to give railroad workers an enforceable right to fair representation by their unions in grievance proceedings, we held in our previous opinion (and subsequent cases have reinforced our holding, see, e.g., Camacho v. Ritz-Carlton Water Tower, 786 F.2d 242 (7th Cir. 1986), discussing the duty of fair representation under the National labor Relations Act), that to establish liability the worker must prove more than simple negligence. As the more was missing here, Graf's unfair-representation claim failed. That left his claim of wrongful discharge against the railroad, Count I. We held that dismissal of that count had been proper insofar as the count alleged that the railroad had violated the collective bargaining contract by firing Graf, but no insofar as it alleged a tort under either federal or state law. We therefore remanded Count I, saying, "In the unlikely event that it is found to state a [tort] claim under federal law the district court should retain jurisdiction. But if it is found to state only a state tort claim it should be remanded to the state court where this suit began." 697 F.2d at 781-82. Instead of proceeding thus, the district judge, after a mysterious two-year hiatus following our decision, dismissed Count I on the merits because the only claim it stated was a state law claim preempted by the Railway Labor Act. Graf again appeals, and we must decide whether the district judge was right to terminate the case as he did.
Clearly the judge erred if Count I was not within the jurisdiction of the federal district court, but it may seem obvious that it was within the court's pendent jurisdiction. This is correct but not obvious. Recall that count II, which presented a federal claim, named only the union as a defendant. If Count I (directed against the railroad) raised no federal claim, it could be brought under the jurisdiction of the district court only by appealing to "pendent party" jurisdiction, an unsettled extension of the more conventional pendent claim jurisdiction. Although we have rejected the use of pendent party jurisdiction to get around the statutory limits on diversity jurisdiction, see Hixon v. Sherwin-Williams, Co., 671 F.2d 1005, 1007-09 (7th Cir. 1982), the concept may be available where the main claim (in this case the claim against the union) raises a federal question. See, e.g., Zabkowicz v. West Bend Co., 789 F.2d 540, slip op. at 10-14 (7th Cir. 1986); Bernstein v. Lind-Waldock & Co., supra, 738 f.2d at 187. But there is a simpler route to the conclusion that Graf's state law claim against the railroad is within the district court's pendent jurisdiction. Our previous decision interpreted Count i as making a federal claim as well as a state law claim (or maybe as making just a federal claim): namely, a claim of breach of the collective bargaining contract. That claim was not frivolous and it therefore conferred jurisdiction over the state law claim by virtue of pendent claim jurisdiction. So there is no need to rely on pendent party jurisdiction.
Nevertheless the district court's pendent claim jurisdiction does not provide a completely secure basis for the court's action, because of the directive in United Mine Workers v. Gibbs, 383 U.S. 715, 726, 16 L. Ed. 2d 218, 86 S. Ct. 1130 (1966), that when all federal claims fall out before trial the district court should relinquish its pendent jurisdiction-a course we have repeatedly insisted on. See, e.g., Blau Plumbing, Inc. v. S.O.S. Fix-It, Inc., 781 F.2d 604, 611-12 (7th Cir. 1986). Instead of doing that, that district court dismissed Graf's state law claim on the merits. In view of this irregular mode of proceeding we shall consider whether Count I, even when stripped of any claim that the railroad broke the collective bargaining contract (for the previous appeal disposed of that claim), presents a federal question. If so, Count I is within the statutory jurisdiction of the district court and the court was on firm ground in deciding the merits.
Although Count I alleges that Graf was fired for exercising his rights under the Federal Employers Liability Act, it appears that neither that Act nor any other source of federal law creates a federal right against retaliatory discharge. See, e.g., Landfried v. Terminal R.R. Ass'n, 721 F.2d 254 (8th Cir. 1983), and cases cited there. On remand the district court so concluded, and Graf does not challenge the conclusion. After this ruling, every explicit federal claim had been exercised from the complaint, leaving only-it might appear- a claim for wrongful discharge under the law of Illinois.
But maybe the Railway Labor Act so pervasively occupies the field of railroad labor disputes that a railroad worker's claim of wrongful discharge necessarily invokes federal law. This may seem to be just a fancy way of saying that a state law claim is preempted by federal law, and we know from Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 77 L. Ed. 2d 420, 103 S. Ct. 2841 (1983), that preemption is a defense rather than an ingredient of the claim itself. That was a case of removal, but the principle is the same whenever the issue is whether a claim is within the federal courts' federal-question jurisdiction. To conclude, however, that preemption never affects the nature of the plaintiff's claim would be inconsistent with the rule that a plaintiff cannot by "artful pleading" prevent the removal of a claim that is really federal though the plaintiff tries to conceal its federal nature. See 14A Wright, Miller & Cooper, Federal Practice and Procedure § 3722, at pp. 242-44 (2d ed. 1985).
The question, then, is whether the plaintiff seeks to base his claim on a body of state law that cannot be applied to his case without violating federal law, or on a body of federal law whose provenance he coyly refuses to acknowledge. In the first situation the case is really a state case, blocked by a federal defense; in the second it is a federal case in state wrapping paper. A federal statute could bring about either situation. A statute that merely created a defense to a state claim would bring about the first, so the case to which it a applied would not be within the federal-question jurisdiction, which depends on the legal basis of the claim, not the defense. But a statute that took over the whole field, with the result that the claim necessarily arose under federal rather than state law, would place the case within the federal-question jurisdiction. A highly pertinent illustration is suing to enforce a collective bargaining contract that is within the jurisdiction of section 301 of the Taft-Hartley Act, 29 U.S.C. § 185. The Supreme Court has held that section 301 provides the exclusive remedy for such breaches. Therefore anyone who brings suit to redress such a breach is, whether he likes it or not, basing his suit on section 301-on federal law-because federal law, which is supreme, doe not allow such a suit to be based on anything else. See Avco Corp. v. Aero Lodge No. 735, Int'l Ass'n of Machinists & Aerospace Workers, 390 U.S. 557, 20 L. Ed. 2d 126, 88 S. Ct. 1235 (1968); Oglesby v. RCA Corp., 752 F.2d 272, 275-78 (7th Cir. 1985); Mitchell v. Pepsi-Cola Bottlers, Inc., 772 F.2d 342, 344-45 (7th Cir. 1985); Williams v. Caterpillar Tractor Co., 786 F.2d 928 (9th Cir. 1986); United Jersey Banks v. Parell, 783 F.2d 360, 365-68 (3d Cir. 1986); Comment, Federal Preemption, Removal Jurisdiction, and the Well-Pleaded Complaint Rule, 51 U. Chi. L. Rev. 634 (1984).
The present case would clearly be of the second type if in Illinois, as in some states (see, e.g., Brockmeyer v. Dun & Bradstreet, 113 Wis. 2d 561, 574-75, 335 N.W.2d 834, 841 (1983)), retaliatory discharge were conceived to be the breach of an implied contractual term, here a term read into the collective bargaining contract; for just as section 301 of the Taft-Hartley Act is the exclusive remedy for breaches of such contracts within the scope of that Act, so the Railway Labo Act provides the exclusive remedy for breaches of such contracts within its scope. See Andrews v. Louisville & Nashville R.R., 406 U.S. 320, 32 L. Ed. 2d 95, 92 S. Ct. 1562 (1972). but in Illinois retaliatory discharge is a tort. See, e.g., Koehler v. Illinois Central Gulf R.R., 109 Ill. 2d 473, 488 N.E.2d 542, 94 Ill. Dec. 543 (1985); Midgett v. Sackett-Chicago, Inc., 105 Ill. 2d 143, 473 N.E.2d 1280, 85 Ill. Dec. 475 (1984). Graf can therefore argue that his claim is based on a body of state law; it is not just a dressing up of a federal claim in state law clothing.
But should the federal character of Graf's complaint really turn on whether state law characterizes wrongful discharge as a tort or a breach of contract? Can it be that if wrongful discharge is a tort, the state court decides the issue of preemption subject only to review by the Supreme Court, while if it is a breach of contract, the federal court decides the issue, provided only that the defendant elects to remove the case from state court to federal court, as of course he can do if the case is deemed to arise under federal law? The procedural difference seems too great to allow it to depend on whether state law describes the same conduct-retaliatory discharge as a tort or as a breach of contract. The state cannot be allowed, merely by the label it attaches to the cause of action, to interfere with the administration of a federal statute. So the remedies provided by federal laws governing disputes over collective bargaining contracts could be exclusive of tort as well as contract remedies. The worker covered by such a contract who brings a tort suit to rectify the consequences of his discharge may be appealing, albeit involuntarily, to federal law, because federal law may provide the sole measure of his rights.
Thus, the simplicity of a test that makes federal jurisdiction depend on whether the complaint is based on state or federal law is illusory in a case where the application of the test depends on first deciding whether federal law merely provides a defense or occupies the field; for deciding whether it is one or the other is not straightforward. Indeed, asking whether federal law provides a defense or occupies the field may just be another way of asking whether the issue of federal preemption shall be decided by a state or a federal court, and perhaps that question should be asked directly, without taking the essentially question-begging step of asking whether the federal statute occupies the field. If the federal statute is deemed merely to create a defense, the state court decides whether it is a good defense; if it is deemed to occupy the field, the federal court decides whether the plaintiff has a cause of action.
If this is what is at stake, the argument for complete preemption may seem weak; the argument amounts to distrust of the ability or willingness of state courts to enforce federal defenses. It would also be simpler to make federal preemption always a defense, so that parties to state court litigation could be sure whether the case was removable to federal court, or if removed whether it could be retained in federal court (the issue in this case), rather ...