Coverson v. Pacific Gas and Electric Company

Background

Lonell Coverson filed an employment case in California state court against Pacific Gas and Electric Company and PG&E Corporation, which the opinion refers to together as PG&E. He alleged race discrimination and retaliation under California’s Fair Employment and Housing Act. His allegations involved opportunities to bid for or receive foreman and electrician positions. Coverson was a union member, and his employment was governed by a collective bargaining agreement.

PG&E removed the case to federal court. It argued that federal law governing labor relations completely preempted Coverson’s state-law claims because deciding them would require interpreting the collective bargaining agreement. Coverson moved to remand, meaning he asked the federal court to return the case to state court. He also requested $3,500 in attorneys’ fees and costs related to the removal.

Remand ruling

The court applied the federal labor-law preemption rule known as Section 301 preemption. Under that rule, a state-law claim may be treated as a federal claim when resolving it depends on interpreting a collective bargaining agreement. The court distinguished between merely referring to or considering the agreement and actually interpreting its meaning.

The court concluded that Coverson’s rights under the Fair Employment and Housing Act came from state law, not from the collective bargaining agreement. It further concluded that his claims were not substantially dependent on interpreting that agreement. In the court’s view, Coverson challenged his supervisors’ alleged discriminatory or retaliatory decisions about whether and when to open positions and use the job-bidding process. The agreement could be considered, but the court said the claims did not require interpreting it.

The court therefore held that Section 301 did not preempt Coverson’s claims and that removal was improper. It granted Coverson’s motion to remand the matter to the Superior Court of the State of California, County of San Francisco.

Fees and costs

The court denied Coverson’s request for attorneys’ fees and costs. Although the court was unpersuaded by PG&E’s arguments, it found that PG&E’s removal was not objectively unreasonable. The court also noted that Coverson had not supported his request with evidence of the actual fees and costs incurred in connection with removal.

Disposition

The motion to remand was granted. The request for attorneys’ fees and costs was denied. The opinion addressed where the case should be heard and the preemption issue; it did not decide the merits of Coverson’s discrimination and retaliation claims.