The opinion of the court was delivered by: Spatt, District Judge.
MEMORANDUM DECISION AND ORDER
This action arises out of the defendant Local 814,
International Brotherhood of Teamsters' ("Local 814"), demand for
arbitration of a dispute between itself and the plaintiff Newmark
& Lewis, Inc. ("Newmark & Lewis"). Local 814 alleges that Newmark
& Lewis breached a collective bargaining agreement by using
non-union employees for the delivery and distribution of its
products. Local 814 removed the action from state court to this
Court on the ground that the dispute between the parties is
governed by section 301 of the Labor Management Relations Act
("LMRA"), 29 U.S.C. § 185.
Before the Court at this time is the motion of Newmark & Lewis
for remand to state court. The sole question presented is whether
under the "well-pleaded complaint rule", the action is properly
Newmark & Lewis employed BSI (non-union employees), for the
distribution and delivery of its products. Local 814 demanded
arbitration to determine whether Newmark & Lewis, as a joint
employer with Westbury, breached the collective bargaining
agreement with the union by using non-union employees.
Pursuant to New York's CPLR 7503, Newmark & Lewis filed a
verified petition to stay the arbitration and simultaneously
obtained an order to show cause, signed by Justice Leo F.
McGinity on March 19, 1991, in the Supreme Court of the State of
New York, Nassau County. The order to show cause temporarily
stayed the arbitration pending a determination of the underlying
In its petition, Newmark & Lewis alleges that there was no
collective bargaining agreement in force between itself and Local
814, and that its recent contract with BSI for the delivery of
its merchandise is a purely private agreement.
Local 814 subsequently removed the state-court proceeding to
this Court pursuant to 28 U.S.C. § 1441(b), based upon
federal-question jurisdiction (see 28 U.S.C. § 1331). In its
removal notice, Local 814 states that, on information and belief,
BSI is the alter ego of Westbury in that "they constitute a
single integrated enterprise". The removal notice further states
that a collective bargaining agreement is in effect between Local
814 and Westbury which contains an arbitration clause.
Accordingly, Local 814 contends that Newmark & Lewis is bound by
the Westbury Agreement by reason of its "joint employer
relationship with Westbury".
The removal notice also states as follows:
"9. . . . The issue of whether there is a valid
collective bargaining agreement between the parties
herein is a matter which this Court would have
original jurisdiction to resolve pursuant to
29 U.S.C. § 185. . . .
10. Although Newmark has cast its action as a state
claim pursuant to Article 75 of the New York Civil
Practice Laws and Rules, such a claim is preempted by
29 U.S.C. § 185, and any action to determine the
validity of an agreement to arbitrate embodied in a
collective bargaining agreement may only be brought
under 29 U.S.C. § 185. . . ."
Newmark & Lewis now moves pursuant to 28 U.S.C. § 1447(c) to
remand the action back to state court, on the ground that this
Court lacks federal subject matter jurisdiction over the dispute.
Newmark & Lewis also seeks an award of costs and ...