United States District Court, N.D. Illinois, Eastern Division
THOMAS BALLARD, on behalf of himself and all others similarly situated, Plaintiff,
AMERICAN AIRLINES, INC., a Delaware corporation, Defendant.
MEMORANDUM OPINION AND ORDER
Robert Blakey Judge
Thomas Ballard, on behalf of himself and all others similarly
situated, sued Defendant American Airlines, Inc., claiming
breach of oral contract, estoppel, fraud, unjust enrichment,
and negligent misrepresentation. Defendant moved to dismiss
pursuant to Federal Rules of Civil Procedure 12(b)(1) and
12(b)(6), arguing that Plaintiff's claims are all
preempted under the Railway Labor Act. For the reasons
explained below, Defendant's motion is granted.
Factual Background & Procedural History
First Amended Complaint (FAC)  sets forth the following
relevant facts, which the Court accepts as true for purposes
of Defendant's motion. Prior to his employment with
American, Plaintiff worked as an aviation maintenance
technician for twenty-four years and earned more than $30.00
an hour. FAC, ¶ 6. After learning about American's
“Hiring Program, ” which offered years-of-service
credit and top-of-scale pay rates for new hires, Plaintiff
applied to work at American. Id. ¶ 7. In March
of 2015, Plaintiff interviewed with American for an aviation
maintenance technician position. Id. ¶ 8.
American told Plaintiff during the interview that, if
employed by American, he would have to join the
Transportation Workers Union of America, AFL-CIO, the labor
union representing American employees; Plaintiff did not meet
with a Union representative, and did not receive any Union
documentation, at that time. Id. American hired
Plaintiff at the end of the interview, and gave Plaintiff a
hiring letter dated March 24, 2015. Id. ¶ 9.
Plaintiff accepted the position and began working for
American in June 2015 at a starting wage of $25.70 an hour.
Id. ¶¶ 7, 10-11. Consistent with the
discussion at his interview, Plaintiff then became a member
of the Union.
two months after Plaintiff started the job, American informed
the Union that it was discontinuing the Hiring Program under
which Plaintiff was hired. Id. ¶ 12. Plaintiff
alleges that American knew it was going to discontinue the
Hiring Program when it hired him, but failed to tell him it
planned to do so. Id. ¶ 13.
alleges that American and the union met in August 2016 to
negotiate the collective bargaining agreement and, that
American announced that, as of August 5, 2016, it would no
longer honor agreements with employees hired under the Hiring
Program. Id. ¶¶ 15, 17-18. American later
extended that date to November 5, 2016. Id. ¶
16. As a result of this decision, employees (like Plaintiff)
who had not met their years of service prior to the
discontinuation date had to work additional years before they
could achieve the top-of-scale pay promised under the Hiring
Program. Id. ¶ 19.
alleges that American pulled a fast one, and that its refusal
to honor the benefits it agreed to under the Hiring Program
constitutes a breach of contract. Id. ¶¶
19-20, 23. Plaintiff contends that American “never had
any intention of honoring its Hiring Program” and that
American “knew or should have known” when hiring
Plaintiff and the Class that it “intended to cancel,
revoke, rescind, and/or breach their agreement with Plaintiff
and the Class.” Id. ¶ 21.
February 28, 2017, Plaintiff sued American in state court,
claiming breach of contract, equitable estoppel, promissory
estoppel, fraud and unjust enrichment. American removed the
case to this Court on April 3, 2017 and moved to dismiss.
See . In response, Plaintiff elected to amend
his complaint; he filed an amended class action complaint on
May 24, 2017. See . Plaintiff's amended
complaint, filed on behalf of himself and the class of
persons who, from 2014 to the date of judgment, were hired by
American and, as new hires, were credited with years of
service and top-of-scale pay rates, claims breach of oral
contract, equitable estoppel, promissory estoppel, fraud,
unjust enrichment, and negligent misrepresentation. See
again moved to dismiss under Rules 12(b)(6) and 12(b)(1).
See . American argues that Plaintiff's
claims should be dismissed under Rule 12(b)(6) because they
are preempted under the Railway Labor Act (RLA) and thus fail
to state a claim. Alternatively, American argues, the claims
should be dismissed under Rule 12(b)(1) because
Plaintiff's claims are all “minor disputes”
subject to the exclusive jurisdiction of the Board of
Adjustment established by American and the Union.
motion under Rule 12(b)(6) tests the sufficiency of the
complaint under the plausibility standard, Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007), not the
merits of the suit, Gibson v. City of Chicago, 910
F.2d 1510, 1520 (7th Cir. 1990). To meet the plausibility
standard, “the complaint must supply ‘enough fact
to raise a reasonable expectation that discovery will reveal
evidence' supporting the plaintiffs allegations.”
Indep. Trust Corp. v. Stewart Info. Servs. Corp.,
665 F.3d 930, 935 (7th Cir. 2012) (quoting Twombly,
550 U.S. at 556). In deciding a Rule 12(b)(6) motion, the
Court accepts as true all well-pleaded facts in
Plaintiff's complaint and draws all reasonable inferences
in his favor. Burke v. 401 N. Wabash Venture, LLC,
714 F.3d 501, 504 (7th Cir. 2013). These same standards apply
when evaluating a facial challenge to subject matter
jurisdiction under Rule 12(b)(1). Silha v. ACT,
Inc., 807 F.3d 169, 174 (7th Cir. 2015) (citations
Preemption Under the Railway Labor Act
requires air carriers to negotiate “rates of pay,
rules, and working conditions” with their
employees' collective bargaining representatives. 45
U.S.C. §151 et seq. Accordingly, the entire
collective bargaining process is governed by federal law
through the RLA. In 1959, the Supreme Court established, in
SanDiego Building Trades Council v.
Garmon, that when an activity is governed by the
National Labor Relations Act, state and federal courts must
defer to the National Labor Relations Board and all state and
federal claims are preempted. 359 U.S. 236, 244-45 (1959). In
1969, the Court extended preemption to the Railway Labor Act
in Railroad Trainmen v. Jacksonville Terminal Co.,
394 U.S. ...