United States District Court, E.D. Virginia, Richmond Division
OLIVER W. HOLMES, Plaintiff,
SYLVIA GROOMS, et al., Defendants.
E. PAYNE SENIOR UNITED STATES DISTRICT JUDGE
ORDER entered on May 17, 2019 (ECF No. 48), the Court
directed the parties to provide supplemental briefing on
whether the Court has subject matter jurisdiction over the
claims asserted in the FIRST AMENDED COMPLAINT
("FAC") (ECF No. 27). Having considered PLAINTIFF
OLIVER HOLMES' SUPPLEMENTAL BRIEF REGARDING SUBJECT
MATTER JURISDICTION (ECF No. 49), DEFENDANTS' JOINT
SUPPLEMENTAL BRIEF REGARDING SUBJECT MATTER JURISDICTION (ECF
No. 50), and PLAINTIFF OLIVER HOLMES' SUPPLEMENTAL REPLY
BRIEF REGARDING SUBJECT MATTER JURISDICTION (ECF No. 51), the
Court concludes that it lacks subject matter jurisdiction
over the claims asserted in the FAC. However, the FAC will be
dismissed without prejudice to the filing of an action in
compliance with the requirements of 29 U.S.C. § 501(b).
Holmes ("Holmes") is a member of the American
Postal Workers Union Local 199 ("APWU" or the
"Union"). See FAC ¶ 1. He brings this action
against the Union and three of its current officers, Sylvia
Grooms ("Grooms") (the current President), Sherry
Gay ("Gay") (the current Secretary), and Jerome
Cosby ("Cosby") (the current Director of Industrial
Relations) (collectively, the "Defendants").
Id. ¶¶ 3-5.
alleges that Holmes attempted to investigate certain
perceived improper expenditures by the Union on behalf of Gay
and Cosby. Holmes also alleges that he was improperly
thwarted in his efforts to investigate these matters by the
Defendants. See generally FAC ¶¶ 9-23.
Holmes also alleges that Grooms maliciously prosecuted him
for defamation and slander "to retaliate against
Plaintiff for speaking out about misuse of union funds."
Id. ¶¶ 24-28.
of the FAC alleges a violation of fiduciary duties by Grooms,
Gay, and Cosby under the Labor-Management Reporting and
Disclosure Act ("LMRDA"), 29 U.S.C. § 501(a).
Count II of the FAC alleges a state law claim for breach of
fiduciary duty against Grooms, Gay, and Cosby. Counts III and
IV of the FAC allege state law breach of contract claims
against the Union. And, Count V alleges a state law malicious
prosecution against Grooms.
response to the FAC, the Defendants filed DEFENDANTS'
MOTION TO DISMISS FIRST AMENDED COMPLAINT (ECF No. 29)
pursuant to Fed.R.Civ.P. 12(b)(6). In reviewing that Motion,
and the parties' supporting and opposing memoranda
thereto (ECF Nos. 30, 36, 37), it appeared that the Court
might lack subject matter jurisdiction over the case because:
(1) 29 U.S.C. § 501(b) requires that "[n]o such
proceeding [for violations of fiduciary duties under 29
U.S.C. § 501(a)] shall be brought except upon leave of
the court obtained upon verified application and for good
cause shown," and Holmes did not seek leave of court to
file the action; and (2) the FAC alleged that supplemental
jurisdiction over the state law claims in Counts II through V
was proper under 28 U.S.C. § 1343, but that statute
pertains to "civil rights and elective franchise."
The FAC made no reference to 28 U.S.C. § 1367, the
statute pertaining to supplemental jurisdiction over state
law claims. Because of these concerns, the Court ordered
additional briefing on whether it had subject matter
jurisdiction over all five Counts in the FAC. See
ECF No. 48.
parties have submitted their supplemental briefing on subject
matter jurisdiction. ECF Nos. 49, 50, 51. Having considered
the supplemental briefing, the Court is satisfied that the
facts and legal contentions are adequately presented in the
materials before the Court; and that, therefore, oral
argument would not aid the decisional process. The matter is
ripe for decision.
of the FAC is based on the LMRDA, 29 U.S.C § 501.
Section 501(a) establishes that certain union officials owe
their union fiduciary duties. If a covered union official
violates the provisions of Section 501(a), then subsection
(b) comes into play. Subsection (b) is entitled
"Violation of duties; action by member after refusal or
failure by labor organization to commence proceedings;
jurisdiction; leave of court; counsel fees and
expenses" (emphasis added).
relevant part, Section 501(b) reads:
When any [covered union official] is alleged to have violated
the duties declared in subsection (a) and the labor
organization or its governing board or officers refuse or
fail to sue or recover damages or secure an accounting or
other appropriate relief within a reasonable time after
being requested to do so by any member of the labor
organization, such member may sue such [covered union
official] in any district court of the United States or in
any State court of competent jurisdiction to recover damages
or secure an accounting or other appropriate relief for the
benefit of the labor organization. No such proceeding
shall be brought except upon leave of the court
obtained upon verified application and for good
cause shown, which application may be made ex parte.
(emphasis added). Based on the plain text of the statute,
Section 501(b) imposes three requirements of a plaintiff who
files suit thereunder. First, the plaintiff must make certain
demands on the union, its governing board, or its officers
that are refused or ignored. Second, the plaintiff must
receive "leave of the court obtained upon verified
application" before bringing such an action. Third, to
secure leave of court to sue, the plaintiff must demonstrate
"good cause." See 29 U.S.C. § 501(b).
including [the Supreme Court], have an independent obligation
to determine whether subject matter jurisdiction exits, even
in the absence of a challenge from any party."
Arbauqh v. Y & H Corp., 546 U.S. 500,
513 (2006); Ruhrgas AG v. Marathon Oil Co.,
526 U.S. 574, 583 (1999); see also Fed.R.Civ.P.
12(h)(3) ("If the court determines at any time that it
lacks subject-matter jurisdiction, the court must dismiss the
action."). Here, the Court has raised the subject matter
jurisdiction issue sua sponte. It is now appropriate
to turn to that issue.
The Court Lacks Subject Matter ...