United States District Court, N.D. Illinois, Eastern Division
May 16, 2005.
GEORGE MITCHELL, Plaintiff,
UNION PACIFIC RAILROAD, TRANSPORTATION COMMUNICATIONS UNION, RAILROAD ADJUSTMENT BOARD, Defendants.
The opinion of the court was delivered by: JAMES MORAN, Senior District Judge
MEMORANDUM OPINION AND ORDER
Plaintiff George Mitchell filed a petition seeking review of a
decision rendered by a division of the Railroad Adjustment Board
(Adjustment Board), which terminated his employment with Union
Pacific Railroad (Union Pacific or "railroad") based on its
finding that plaintiff claimed unemployment benefits, to which he
was not entitled, and other improper conduct. Along with his
petition plaintiff has filed a petition to proceed in forma
pauperis. For the following reasons, plaintiff's petition is
dismissed with prejudice, in part and granted in part.
Plaintiff was employed by Union Pacific as an extra board
clerk, and in that position it called him when work hours were
available, as opposed to providing a set work schedule. On August
29, 2002, plaintiff applied for unemployment benefits from the
Railroad Retirement Board (Retirement Board), and was approved to
receive those benefits, despite the fact that he was a full-time
Union Pacific employee. Plaintiff believed that he was entitled
to receive unemployment benefits because Union Pacific allegedly
did not pay his guaranteed salary, to which he claims he was entitled. After discovering
that plaintiff claimed and received unemployment benefits as a
full-time employee, Union Pacific charged him with violating Rule
1.6 of its General Code of Operating Rules (operating rules),
which states that "employees must not . . . be insubordinate,
dishonest, immoral or quarrelsome." On June 19, 2003, the
railroad held an investigative hearing, which plaintiff attended,
represented by members of the Transportation-Communications Union
(Union). After the hearing, Union Pacific concluded that
plaintiff violated Rule 1.6 and then dismissed him from his
Plaintiff then filed a wrongful termination action against
Union Pacific, which this court dismissed because the Railway
Labor Act (Act) required plaintiff to advance his claim through
an internal administrative appeals process. Availing himself of
that process, plaintiff submitted his claim before a Public Law
Board (Law Board or Board). And, on August 16, 2004, the Board
denied plaintiff's claim, concluding that there was "overwhelming
evidence" to support the railroad's charge that plaintiff made
himself unavailable for work assignments by missing numerous
phone calls and then "claim[ing] unemployment benefits to offset
his numerous absences and loss of wages . . . [when he] should
not have claimed unemployment benefits at all." Plaintiff now
appeals the Board's findings and its endorsement of his
Pursuant to 28 U.S.C. § 1915(a) we may authorize plaintiff to
proceed in forma pauperis if he demonstrates an inability to
pay the required costs and fees. On April 13, 2005, plaintiff
filed a financial affidavit, but, being incomplete, it was
dismissed without prejudice. Plaintiff then filed a second
financial affidavit, and in it he asserts that he was last
employed on June 8, 2003, at which time his monthly salary was
$420. Plaintiff also discloses that within the past twelve months he has received $3,120 in unemployment benefits. In
his first financial affidavit plaintiff stated that he had $54.65
in a bank account and $2,900 of personal property, but these
assets apparently no longer exist as plaintiff does not include
them in his current financial affidavit. Plaintiff has
sufficiently cured the deficiencies in the April 13 affidavit and
has made the requisite showing of financial need.
However, the inquiry does not end with that finding of
indigence. As part of the initial review of a petition to proceed
in forma pauperis, we analyze plaintiff's claims and dismiss
the complaint if the action is frivolous or malicious, fails to
state a claim upon which relief may be granted, or seeks damages
from a defendant who is immune from such relief.
28 U.S.C. § 1915(e)(2)(B)(i)-(iii); Alston v. Debruyn, 13 F.3d 1036, 1039
(7th Cir. 1994). Determining if the complaint fails to state
a claim invokes the familiar standard from FED. R. CIV. P.
12(b)(6), under which the court accepts all well-pleaded facts as
true and draws all reasonable inferences in plaintiff's favor.
Thompson v. Illinois Dep't of Prof'l Regulation, 300 F.3d 750,
753 (7th Cir. 2002). Further, a complaint should not be
dismissed "unless it appears beyond a doubt that the plaintiff
can prove no set of facts in support of his claim which would
entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46
(1957). Complaints by pro se parties are held to less stringent
standards than pleadings drafted by lawyers (Alvarado v.
Itscher, 267 F.3d 648, 651 (7th Cir. 2001)), but a pro se
complaint must still allege facts that serve as an adequate basis
for each claim. Gray v. Dane County, 854 F.2d 179, 182 (7th
The Railway Labor Act (Labor Act) "permits federal courts to
intervene only in limited circumstances" and "judicial review of
board of arbitrators' decision is `among the narrowest known to
law.'" Pokuta v. Trans World Airlines, Inc., 191 F.3d 834, 839
(7th Cir. 1999) (quoting Union Pacific R.R. Co. v. Sheehan,
439 U.S. 89, 91 (1978)). A federal court has no authority to review a Board's findings of fact. Lyons v. Norfolk
& Western Ry., 163 F.3d 466, 468 n. 1 (7th Cir. 1999); see
also United Paperworkers Int'l Union v. Misco, Inc.,
484 U.S. 29, 38 (1987) (courts "do not sit to hear claims of factual or
legal error by an arbitrator as an appellate court does in
reviewing decisions of lower courts."). Under section 153 First
(q) of the Act, "a federal court has jurisdiction to review the
Board's decision only when it is asserted that (1) the Board
failed to comply with the requirements of the Railway Labor Act;
(2) the Board failed to confine itself to matters within its own
jurisdiction; or (3) the Board or one of its members engaged in
fraud or corruption." Pokuta, 191 F.3d at 839. "Only upon one
or more of these bases may a court set aside an order of the
Adjustment Board." Sheehan, 439 U.S. at 93. In addition to the
three grounds set forth in section 153 First (q), the Seventh
Circuit Court of Appeals has recognized that appeals based on
alleged due process violations may be heard by district courts.
See Pokuta, 191 F.3d at 839 (7th Cir. 1999); Bates v.
Baltimore & Ohio R.R. Co., 9 F.3d 29, 31 (7th Cir. 1993);
Morin v. Consolidated Rail Corp., 810 F.2d 720, 722 (7th
Cir. 1987); Elmore v. Chicago & Ill. Midland Ry. Co.,
782 F.2d 94, 96-97 (7th Cir. 1986).
A Public Law Board is "an optional dispute-resolution
mechanism" created under the Railway Labor Act (Steffens v.
Brotherhood of Ry., 797 F.2d 442, 447 (7th Cir. 1986)), and
a party before the Board has "the same opportunities for judicial
review that are available to the parties for an Adjustment Board
award." United Transp. Union v. Indiana H.B.R. Co.,
540 F.2d 861, 862 (7th Cir. 1976). Awards made by a Law Board are
"final and binding upon both parties to the dispute."
45 U.S.C. § 153(m); Kulavic v. Chicago & Ill. M. Ry. Co., 1 F.3d 507,
513-14 (7th Cir. 1993); see also O'Neill v. Public Law Bd.
No. 550, 581 F.2d 692, 694 (7th Cir. 1978). Because the court's jurisdiction depends on the presence of a
section 153 First (q) factor (Pokuta, F.3d at 839), the
threshold issue of jurisdiction precedes the question of whether
plaintiff states a claim. If plaintiff fails to establish
jurisdiction under section 153 First (q), then the complaint
states no arguable basis for relief and must be dismissed under
section 1915(e)(2)(B)(i) as frivolous, due to lack of subject
matter jurisdiction.*fn1 If jurisdiction is absent, then the
court cannot proceed to determine the merits in the case and "the
only function remaining to the court is that of announcing the
fact and dismissing the cause." Steel Co. v. Citizens for a
Better Env't, 523 U.S. 83, 94 (1998) (quoting Ex parte
McCardle, 74 U.S. (7 Wall.) 506, 514 (1868)); see also State
of Illinois v. City of Chicago, 137 F.3d 474, 478 (7th Cir.
1998) ("Subject-matter jurisdiction is the first question in
every case, and if the court concludes that it lacks jurisdiction
it must proceed no further.").
As discussed above, section 153 First (q) is a specific grant
of jurisdiction that permits federal courts to review Board
decisions if one of three types of error is alleged. Plaintiff
claims that the Board committed all three types of error and also
violated his due process rights. However, plaintiff's arguments
dwell on extraneous topics and events, such as the tangentially
related proceedings before the Retirement Board and the
disciplinary hearing initiated by the railroad. Our analysis
extends only to the Law Board's decision, and we begin with
plaintiff's claim that the Board exceeded its jurisdiction.
To prove that the Board exceeded its jurisdiction, plaintiff
must show that "the Board's decision is without foundation in
reason or fact . . . or wholly baseless and without reason."
Anderson v. National R. Passenger Corp., 754 F.2d 202, 203
(7th Cir. 1984). Plaintiff claims that the Board was only permitted to examine the collective
bargaining agreement and that it acted outside of its
jurisdiction because it interpreted the Railroad Unemployment
Insurance Act (Insurance Act). Plaintiff cannot point to any
portion of the Board's decision that shows it interpreted, or
even contemplated, the Insurance Act. The mere fact that the
Board considered plaintiff's application for unemployment
benefits and other correspondence between plaintiff and
Retirement Board officials is not tantamount to interpreting the
Insurance Act. Instead, the Board's consideration of those
documents established that plaintiff received unemployment
benefits, which Union Pacific and the Board concluded was in
violation of the operating rules. Plaintiff believes that the
Board's finding necessarily undermines the conclusion of a
Retirement Board hearing officer, who determined that plaintiff's
receipt of unemployment benefits did not constitute an
overpayment. The Labor Board was not bound by the Retirement
Board's position on plaintiff's eligibility to receive
benefits.*fn2 Further, plaintiff's eligibility to receive
benefits is distinct from the propriety of a full-time employee
claiming and receiving unemployment payments. The Law Board was
not simply concerned with the receipt of unemployment benefits.
It noted that plaintiff's propensity for missing calls in order
to make himself unavailable for work supported his termination.
Here the Board arguably interpreted and applied the operating
rules, and the court has no authority to disagree with its
conclusions. United Paperworkers Int'l Union, 484 U.S. at 38.
Ultimately, plaintiff cannot show that the decision is without
reason or fact, and there is thus no indication that the Board
exceeded its jurisdiction. Plaintiff's reference to proceedings before the Retirement Board, Union Pacific's alleged
failure to make guaranteed salary payments to him, and his
decision to enroll in the railroad's education plan, are all
irrelevant to our review of the Board's decision. Since the Board
acted within its jurisdiction, its findings are conclusive under
section 153 First (q). The court therefore lacks subject matter
jurisdiction to hear plaintiff's claim that the Board exceeded
the scope of its jurisdiction.
Plaintiff next attempts to establish jurisdiction under section
153(q) by contending that there was fraud or corruption by a
member of the Labor Board. Plaintiff contends that the railroad
committed fraud by presenting that he had a full-time position
and was paid under a salary guarantee, and he cites
20 CFR § 355.1(b)(1) in support of his position. But that regulation
refers to the making of fraudulent statements to the Retirement
Board, and has nothing to do with the "fraud or corruption by a
member" of the Labor Board. Equally irrelevant are the
proceedings before the Retirement Board. Plaintiff also believes
that his participation in a company-sponsored education program
demonstrated Union Pacific's acquiescence to his receipt of
unemployment benefits. Not only does this argument fail to shed
any light on the issue of fraud or corruption by the Labor Board,
it is also mistaken. The railroad clearly communicated to
plaintiff that, despite his decision to attend school, he was
expected to make himself available to work.*fn3 Section 153
First (q) does not permit review of the evidence before the
Board. See Anderson, 754 F.2d at 204 ("the sufficiency of the
evidence comprising the foundation of the Board's decision is not
reviewable."); Bates, 9 F.3d at 32 (evidentiary disputes are
not within the narrow jurisdictional grounds set forth by section 153(q)). Further, claiming that the Board ignored facts is an
"attack on the Board's conclusions," which cannot be maintained
under the Railway Labor Act. Steffens, 797 F.2d at 447.
Thus, instead of showing fraud or corruption, plaintiff appears
to retry his case by arguing that his receipt of unemployment
benefits was proper and the Board's decision to endorse his
dismissal was in error. Plaintiff appears to focus on every
proceeding except the only relevant one, that before the Board,
and he cloaks his disagreement with that forum's conclusion with
specious allegations of fraud and corruption. Plaintiff's claim
of fraud or corruption by the Labor Board is dismissed with
Plaintiff next argues that the Board failed to comply with the
Act and also violated his due process rights by not providing
notice of the Board's hearing. Board decisions are reviewable "if
they are violative of due process." O'Neill, 581 F.2d at 694.
Section 153 First (j) requires a National Railroad Adjustment
Board to "give due notice of all hearings to the employee or
employees and the carrier or carriers involved in any disputes
submitted to them," and applies with equal force to Public Law
Boards. Id. at 695. An involved party who lacks notice of a
Board proceeding may be deprived of a constitutional right.
Hunter v. Atchison, 171 F.2d 594, 597 (7th Cir. 1948).
Plaintiff was a party involved in the dispute because the Board
adjudicated his rights and duties. See Burlington Northern,
Inc. v. American Ry. Supervisors Asso., 527 F.2d 216, 220
(7th Cir. 1975).
But notice to the employee is not invariably required. In
O'Neill, the court held that when an employee authorizes his
union to represent him before the Board and "to receive any
notices on his behalf, Section 153 First (j) does not require
that actual notice be given to the individual employee."
O'Neill, 581 F.2d at 695. And in Bates, 9 F.3d at 31, the
court held that notice of a hearing is not required if the employee waives his
right to an oral hearing by communicating to the Board his intent
to rely on written submissions.
It is unclear if either of these exceptions apply, and if the
need for personal notice of the hearing was accordingly obviated.
In a letter that the Union sent to plaintiff, along with the
Board's decision, we learn that the claim was filed on
plaintiff's behalf and submitted to the Board. Also, that after
the Board denied plaintiff's claim, the Union told him that it
was closing his file. This letter may trigger the O'Neill
exception, but there is simply not enough information to
determine whether that is truly the case. Thus, plaintiff's claim
that he lacked notice of the hearing falls under section 153(q).
And, given the generous treatment afforded to filings submitted
by pro se parties, plaintiff has stated a claim that the Board
failed to provide notice pursuant to section 153 First (j) and
violated his due process rights.
For the foregoing reasons, plaintiff may proceed in forma
pauperis on his claim that the Public Law Board failed to
provide notice of the hearing, but the remainder of his claims
are dismissed with prejudice.*fn4