Sunday, July 22, 2012
Another jurisdictionality victory
This time it's the Sixth Circuit, holding that mandatory arbitration of minor disputes under the Railway Labor Act is not jurisdictional, applying Arbaugh's plain statement rule. (H/T: Reader and occasional commenter Asher Steinberg). Interestingly, this was a panel overturning circuit precedent, not the en banc court, a departure from circuit rules; the court explained that the departure was compelled by a specific Supreme Court decision, Arbaugh. This is a different approach than the Seventh Circuit recently took, where the shift was done by the full court, not in light of a single case, but in light of the general trend of Supreme Court precedent over the past few years.
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The circuit rule you refer to was breached, appropriately, for exactly the same reason, in Primax Recoveries v. Gunter in 2006. It was also in light of Arbaugh. Judge Sutton was on both panels; I'm guessing he's a purist like you and Justice Scalia are, fighting the good fight!
It's interesting that the court doesn't quote the one part of the statute that has a fighting chance of actually passing the Arbaugh bright-line test: here is the selective quote that should have been in one of the briefs.
"If any employee or group of employees, or any carrier, is aggrieved [by the result of an NRAB case], then [...] [t]he [district] court *shall have jurisdiction* to affirm the order of the division, or to set it aside, in whole or in part." 45 USC 153(q).
The argument for a jurisdictional dismissal then would be as follows: the court has jurisdiction IF there's an aggrieving result to NRAB arbitration. So conversely it must have no jurisdiction if that arbitration hasn't happened.
That argument should lose, however, despite the statutory hint, if the court follows Justice Scalia in Steel Company. If I remember right, he argued, and I think everyone agrees, that when Congress uses the word "jurisdiction" in a statute in this way ("the court has jurisdiction to do X, Y, or Z as its options"), it doesn't really MEAN jurisdiction in the usual sense. Have I got that right, Howard?
Anyway, a little odd that there's no acknowledgment of this specific statutory language. Setting up the counterargument and then knocking it down would help future courts when there is similar mention of "jurisdiction" in a statute.
(The jurisdiction/merits distinction could matter to the parties if the action were alleged to be "arising under" 153(p), because then the employee's court costs would be covered by the federal system. If it lacks jurisdiction they wouldn't be. See Primax for an example of legal fees hinging on a jurisdiction/merits distinction. But here I imagine the briefing only just touched on the procedural distinction, since the parties didn't -- did they? -- have a stake in 12(b)(1) v. 12(b)(6) results.)
The other interesting fact about this is that it finally, after almost sixty years and presumably many amendments of the statute, overrules the lower courts in Conley v. Gibson on legal rather than factual grounds. The holding in Conley was actually about a railway labor dispute that lower courts had held jurisdictionally barred for failure to go to the precursor of the NRAB. The Supreme Court said the facts didn't support that outcome, and then went on to say the stuff that Iqbal swept away. If cert is denied here we can consider Conley FULLY retired.
More at the link, for sickos like Howard and me who find this stuff interesting.
Posted by: Jim von der Heydt | Jul 22, 2012 11:54:25 PM
JvdH - I've been trying to understand the practical importance of the merits/jurisdictional distinction and your penultimate paragraph helps. Thanks.
Posted by: Michael Duff | Jul 23, 2012 9:11:18 AM
The distinction also had practical significance in Arbaugh, for a different reason. In that case, the argument for dismissal wasn't found until after the trial (verdict for the plaintiff). So the 12b6 argument wasn't preserved for appeal, and if the argument was merits-based it could not be raised. —But there was hope for the defendants, because 12b1 arguments don't have to be preserved. If the court had lacked jurisdiction all along, its ruling would have to be retroactively invalidated.
Hence the defendants could have prevailed on appeal, if the statutory element was jurisdictional. It was not.
MOREOVER: the distinction between 12(b)6 and 12(b)(1) standards matters significantly more now. After Iqbal, a 12(b)(6) motion always triggers testing of the complaint for factual "plausibility"; a 12(b)(1) motion does not. Caveat: if the 12(b)(1) motion challenges the predicate *facts* for jurisdiction, the court can call for discovery on those facts; but most 12(b)(1) motions are "facial," meaning that they only challenge the legal (not the factual) sufficiency of the complaint. Therefore Iqbal does not (or at least should not) apply to them. (Again, click the link if you're interested in the two dozen thousand word version of this argument.)
It's because of Iqbal that I think Howard's jurisdictionality argument is particularly urgent. Lower courts are willy-nilly using plausibility analysis in the 12(b)(1) context, and my read is that Justice Scalia, among others, wants them to stop.
Posted by: Jim von der Heydt | Jul 23, 2012 3:28:19 PM
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