Second Circuit Holds that No Preemption of State Claims Possible If Federal Court Lacks Original Jurisdiction over Such Claims

The Second Circuit in Sullivan v. American Airlines, Inc., 424 F.3d 267 (2d Cir. Sep. 13, 2005) has held that there is a lack of complete preemption under the Railway Labor Act ("RLA") because certain disputes under the RLA do not qualify for original federal jurisdiciton and thus would be non-removable from state court:

Once we recognize that a state-law-based RLA minor dispute cannot be brought within the original jurisdiction of the federal courts and is thus not removable under § 1441, it becomes clear that the RLA does not completely preempt state-law claims that come within its scope. By its terms, § 1441 allows removal only of suits "of which the district courts of the United States have original jurisdiction ...." 28 U.S.C. § 1441(a); see also id. § 1441(b). Put another way, "[o]nly state-court actions that originally could have been filed in federal court may be removed to federal court by the defendant." Caterpillar, 482 U.S. at 392, 107 S.Ct. 2425 (emphasis added).

Minor disputes under the RLA cannot be filed in the first instance in federal court; they are therefore not removable to federal court. Instead, primary jurisdiction over minor disputes under the RLA--the type of claim American asserts that Sullivan has raised--exists solely in the adjustment boards established pursuant to 45 U.S.C. § 153 (for railroads) or § 184 (for airlines). [citations omitted] Indeed, American removed Sullivan's defamation claim to federal district court for the sole purpose of asking that court to dismiss Sullivan's claim on the basis that the federal court could not hear it.

As this case illustrates, allowing removal to federal court on complete-preemption grounds of state-law claims that also qualify as minor disputes under the RLA is internally inconsistent: the district court must have jurisdiction for removal to be proper, but the court must then dismiss the removed case because only adjustment boards, not federal courts, have primary jurisdiction over claims arising under the RLA. The latter negates the former.