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Chicago Regional Council of Carpenters, An Unincorporated v. Prate Installations

January 31, 2011

CHICAGO REGIONAL COUNCIL OF CARPENTERS, AN UNINCORPORATED ASSOCIATION, PLAINTIFF,
v.
PRATE INSTALLATIONS, INC., AN ILLINOIS CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge:

MEMORANDUM OPINION AND ORDER

On August 27, 2010, Plaintiff Chicago Regional Council of Carpenters (the "Union") filed a Complaint for Declaratory Judgment against Prate Installations, Inc. ("Prate") in response to Prate's demands for damages based on violations of the Most Favored Nations ("MFN") clause contained in a series of Collective Bargaining Agreements ("CBAs") between the Union and the Resident Construction Employers Council ("RCEC"). On September 20, 2010, Prate filed an Answer and Counterclaim alleging a breach of contract claim under Section 301 of the Labor Management Relations Act of 1947 ("LMRA"), 29 U.S.C. § 185, et seq., based on the Union's alleged violations of the MFN clause. Before the Court is the Union's Motion for Judgment on the Pleadings pursuant to Federal Rule of Civil Procedure 12(c) in regard to Prate's Counterclaim. For the following reasons, the Court grants in part and denies in part the Union's Rule 12(c) motion. Specifically, claim preclusion bars Prate's claims based on the 2005-2008 CBA, but not the claims based on the 2008-2009 CBA. In addition, issue preclusion does not bar the claims based on the 2008-2009 CBA or the 2009-2010 CBA.

LEGAL STANDARD

Rule 12(c) motions for judgment on the pleadings differ from Rule 12(b) motions to dismiss because they are brought after the pleadings are closed. See Fed. R. Civ. P. 12(c); Buchanan-Moore v. County of Milwaukee, 570 F.3d 824, 827 (7th Cir. 2009). Despite the difference in timing, the Court reviews Rule 12(c) motions under the same standards that apply to motions to dismiss under Rule 12(b)(6). See Buchanan-Moore, 570 F.3d at 827; Pisciotta v. Old Nat'l Bancorp, 499 F.3d 629, 633 (7th Cir. 2007). Under Rule 12(c), the Court accepts all well-pleaded allegations in the complaint as true and draws all reasonable inferences in favor of the plaintiff. See Finch v. Peterson, 622 F.3d 725, 728 (7th Cir. 2010); Pisciotta, 499 F.3d at 633. Moreover, to avoid dismissal, a plaintiff must plead sufficient facts to state a claim of relief that is plausible on its face. See Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009); Bell Atlantic v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 167 L.Ed.2d 929 (2007).

Rule 12(c) permits judgment based on the pleadings alone, which include the complaint, the answer, and any written instruments attached as an exhibit. See Northern Ind. Gun & Outdoor Shows, Inc. v. City of South Bend, 163 F.3d 449, 452 (7th Cir. 1998); Fed.R.Civ.P. 10(c) ("A copy of a written instrument that is an exhibit to a pleading is a part of the pleading for all purposes."). When determining whether the affirmative defenses of claim preclusion and issue preclusion apply, courts must necessarily look to the details of the earlier lawsuit to make any such determination. See, e.g., Czarniecki v. City of Chicago, ___ F.3d ___, 2011 WL 181471 (7th Cir. Jan. 21, 2011); Carr v. Tillery, 591 F.3d 909, 913-14 (7th Cir. 2010) (affirmative defense of claim preclusion properly brought in Rule 12(c) motion); see also Deicher v. City of Evansville, Wis., 545 F.3d 537, 541 (7th Cir. 2008) (courts may take judicial notice of documents contained in public record).

BACKGROUND

Prate, as a member of the RCEC, is bound by certain CBAs between the RCEC and the Union. Specifically, the RCEC and the Union were parties to two CBAs from 1998-2001 and 2001-2005. Thereafter, the Union and RCEC negotiated subsequent CBAs, including the 2005-2008 CBA, the 2008-2009 CBA, and the 2009-2010 CBA. In the previous litigation before the Court, Prate, as Plaintiff, sought to enforce an arbitration award. See Prate Installations, Inc. v. Chicago Reg'l Council of Carpenters, Case No. 08 C 5377. The Court presumes familiarity with the previous lawsuit between the exact same parties as here.

In the previous lawsuit, the parties mutually selected Arbitrator James Martin to determine the parties' dispute concerning the Union's violation of the MFN clause. After eighteen days of hearings between March 13, 2007 and February 7, 2008, Arbitrator Martin awarded Prate $9,434,436 for the Union's violations of the 2001-2005 and 2005-2008 CBAs on September 3, 2008. (08 C 5377, R. 1-2, Ex. D, 9/3/08 Arbitration Award, at 18, 22-23.) The Arbitrator concluded that by permitting other construction employers to pay by piecework, but enforcing the hourly wage requirement against Prate, the Union violated the MFN clause. As such, the Arbitrator concluded:

"[T]he union violated the Most Favored Nations article when it required Prate to pay on an hourly basis instead of by piecework from July 14, 2002 to the date of this award; that Prate is to be allowed to pay by piecework until the union establishes that it can enforce the no-piecework provision uniformly; that Prate is to be made whole for its losses, from July 14, 2002 until the date of this award in the amount of $9,434,436; that the union is to pay the reasonable and itemized attorney fees and expenses expended by Prate for the preparation and prosecution of this grievance, not to exceed $2 million.

(08 C 5377, R. 29, Summ. J. Min. Order, at 2.)

Thereafter, Prate filed the earlier federal lawsuit asking the Court to confirm the arbitration award and the Union sought to vacate the arbitration award on the grounds that Arbitrator Martin exceeded the scope of his authority. On May 6, 2009, the Court granted in part and denied in part the parties' cross-motions for summary judgment. In particular, the Court partially vacated the arbitration award, namely, the equitable portion and the damages award of $4,284,355. The Court confirmed the award of $5,150,081 and attorney's fees. The Court specifically determined that Arbitrator Martin exceeded the scope of his authority in determining disputes between the parties for the period of time after September 30, 2005 because after that date the 2005-2008 CBA governed the Union's and Prate's contractual relationship and that the 2005-2008 CBA created a standing panel of five rotating arbitrators for the resolution of disputes to which Arbitrator Martin was not a member. The Seventh Circuit affirmed the Court's summary judgment order on June 4, 2010. See Prate Installations, Inc. v. Chicago Reg'l Council of Carpenters, 607 F.3d 467, 474 (7th Cir. 2010).

ANALYSIS

I. Statute of Limitations

The Court first addresses the threshold matter of whether Prate has filed the present Counterclaim based on Section 301 of the LMRA in a timely fashion. "Claims asserted under § 301 of the LMRA are not governed by a specific statute of limitations, and therefore courts reviewing claims under that section must borrow an appropriate limitations period." Jones v. General Elec. Co., 87 F.3d 209, 211 (7th Cir. 1996). When a federal statute is silent to the limitations period, federal courts borrow the most analogous state law statute of limitations. See Young v. Verizon's Bell Atlantic Cash Balance Plan, 615 F.3d 808, 815-16 (7th Cir. 2010); Jones, 87 F.3d at 211. "A narrow exception to this standard borrowing rule exists when analogous state statutes of limitations would frustrate or significantly interfere with the ...


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