applies only when necessary to carry out an approved transaction." Id. at 127. Accordingly, if the condition precedent of active employment -- which prevented plaintiffs from taking advantage of the lump-sum payment -- was not necessary to carry out the approved merger, the exemption does not apply.
Thus, assuming Union Pacific's denial of plaintiffs' application for the separation program violated the FMLA, the PDA, and/or the ERISA because they were on maternity leave and thus failed to meet the condition precedent of active employment to qualify for the lump sum payment, the issue is whether such condition was necessary to carry out the approved transaction.
Plaintiffs want the court to decide the issue. Union Pacific says the court has no jurisdiction to decide the matter; rather, the issue of what was necessary to carry out the approved merger resides in the exclusive jurisdiction of the ICC -- now the Surface Transportation Board. Neither party cites any case law directly supporting their respective positions.
The court, however, located an analogous opinion from the Ninth Circuit. In Ry. Labor Executives' Ass'n v. Southern Pacific Transp. Co., 7 F.3d 902 (9th Cir. 1993), a dispute erupted between the union and the railroads following an ICC-approved merger regarding the implementation of maintenance operations. The union claimed that the dispute must be resolved by resorting to the provisions of the Railway Labor Act ("RLA"). Id. at 904. The railroads asserted that they were exempted from the provisions of the RLA as a result of the applicability of § 11341(a). Id. The union countered that argument by responding that the post-merger changes in maintenance operations were not necessary to carry out the merger, thus, § 11341(a) was inapplicable. Id. at 904-05.
The Ninth Circuit concluded that the union's claim must be raised before the ICC, not in the federal district court -- i.e., the ICC must determine what was necessary to carry out the merger. Id. at 905-06 ("It follows ... that where a railroad which has been a party to an ICC-approved merger claims that certain proposed actions are incident to that merger and exempt ... under § 11341(a), the ICC has exclusive authority to resolve a challenge to these claims.") (emphasis added); see Am. Train Dispatchers Ass'n v. I.C.C., 307 U.S. App. D.C. 93, 26 F.3d 1157, 1164 (D.C. Cir. 1994). The court agrees with the Ninth Circuit's holding and concludes that the determination of what was necessary to carry out the approved merger resides within the exclusive jurisdiction of the ICC pursuant to 11341(a), i.e., the court lacks jurisdiction to resolve this dispute.
B. Breach of Contract (Count IV)
In Count IV, Harris apparently claims that Union Pacific initially approved her application for the separation program. Subsequently, Union Pacific learned that Harris was ineligible for the separation program because she failed to satisfy the condition precedent of active employment, thus, it rejected her application. Harris apparently contends that Union Pacific's original acceptance of her application resulted in a binding contract and Union Pacific's subsequent rejection of her application breached this contract.
Harris offers two arguments as to why the breach of contract action should remain in this action: first, Harris argues that the contract was entered into after the merger, thus, § 11341(a) does not apply; second, Harris argues that the contract has no impact on the merger, thus, § 11341(a) does not apply. The court does not find either of Harris' arguments persuasive.
Regarding the first argument, the contract was allegedly entered into on September 6, 1995, but the official date of the merger was not until October 1, 1995. Accordingly, Harris' argument is factually erroneous and thus without merit.
With respect to Harris' second argument, the court cannot conclude that § 11341(a) is inapplicable. The separation agreement -- which is, of course, part of the implementing agreement that was negotiated between Union Pacific, CNW, and the union that represented Harris in this ICC-approved merger -- limited the number of available spots to 300 eligible employees. Harris, of course, did not qualify as an eligible employee. Assuming a contract was entered into between Harris and Union Pacific, the contract would be in direct violation of the separation agreement. Assuming the separation agreement is necessary to carry out the merger -- consistent with the above holding, such a determination resides in the exclusive jurisdiction of the ICC -- it appears to the court that Union Pacific's breach of the contract is likely exempted under the provisions of § 11341(a).
Based on the court's analysis, Counts I, II, III, and IV are dismissed for lack of jurisdiction.
Date: FEB 07 1997
JAMES H. ALESIA
United States District Judge