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United Public Workers v. Ige

United States District Court, D. Hawaii

February 19, 2016

UNITED PUBLIC WORKERS, AMERICAN FEDERATION OF STATE, COUNTY, MUNICIPAL EMPLOYEES, LOCAL 646, AFL-CIO, Plaintiff,
v.
DAVID Y. IGE, in his capacity as Governor of the State of Hawaii, Defendant.

ORDER DENYING PLAINTIFF’S MOTION FOR A PRELIMINARY INJUNCTION (ECF NO. 30) AND GRANTING DEFENDANT’S MOTION FOR JUDGMENT ON THE PLEADINGS (ECF NO. 27) AND DISMISSING PLAINTIFF’S COMPLAINT (ECF NO. 1) WITH PREJUDICE

HELEN GILLMOR, UNITED STATES DISTRICT JUDGE

On June 10, 2015, the Defendant Governor of the State of Hawaii, David Y. Ige, signed Act 103 into law.[1] Act 103 directs the Governor to effectuate the transfer of the management and operation of Maui Memorial Medical Center, Kula Hospital and Clinic, and Lanai Community Hospital to a private entity. The three facilities are currently operated by the Maui Regional System of the Hawaii Health Systems Corporation, an agency of the State of Hawaii.

Plaintiff, a union representing approximately 1, 500 employees of the Hawaii Health Systems Corporation, has filed a lawsuit to enjoin the Governor from implementing Act 103. Plaintiff claims that Act 103 violates the Contract Clause of the United States Constitution. Plaintiff argues Act 103 interferes with two Collective Bargaining Agreements entered into between the State of Hawaii and certain employees of the Hawaii Health Systems Corporation on Maui. Plaintiff asserts that the Collective Bargaining Agreements remain in effect until June 2017.

The Defendant Governor of the State of Hawaii filed a Motion for Judgment on the Pleadings (ECF No. 27) to dismiss Plaintiff’s Complaint on the basis that Plaintiff has failed to state a claim upon which relief may be granted and Plaintiff’s suit is barred against him pursuant to the Eleventh Amendment to the United States Constitution.

Plaintiff filed a Motion for a Preliminary Injunction to prevent the Governor from implementing Act 103. (ECF No. 30).

Plaintiff’s Motion for a Preliminary Injunction (ECF No. 30) is DENIED.

Defendant’s Motion for Judgment on the Pleadings (ECF No. 27) is GRANTED.

Plaintiff’s Complaint (ECF No. 1) is DISMISSED WITH PREJUDICE.

PROCEDURAL HISTORY

On August 6, 2015, Plaintiff United Public Workers, American Federation of State, County, Municipal Employees, Local 646, AFL-CIO (“Plaintiff”) filed a Complaint against Defendant David Y. Ige, in his capacity as Governor of the State of Hawaii (“Defendant”). (ECF No. 1).

On November 5, 2015, Defendant filed GOVERNOR DAVID IGE’S MOTION FOR JUDGMENT ON THE PLEADINGS. (ECF No. 27).

On November 9, 2015, Plaintiff filed PLAINTIFF’S MOTION FOR A PRELIMINARY INJUNCTION. (ECF No. 30).

On November 19, 2015, the Court held a status conference as to the Parties’ Motions and set a briefing schedule for both Motions. (ECF No. 44).

On November 25, 2015, Plaintiff filed an Opposition to Defendant’s Motion for Judgment on the Pleadings. (ECF No. 48).

On December 7, 2015, Defendant filed an Opposition to Plaintiff’s Motion for Preliminary Injunction. (ECF No. 52).

On December 18, 2015, Defendant filed a Reply to Plaintiff’s Opposition to Defendant’s Motion for Judgment on the Pleadings. (ECF No. 53).

On December 21, 2015, Plaintiff filed a Reply to Defendant’s Opposition to Plaintiff’s Motion for Preliminary Injunction. (ECF No. 54).

On January 13, 2016, the Court held a hearing on Plaintiff’s Motion for Preliminary Injunction (ECF No. 30) and Defendant’s Motion for Judgment on the Pleadings (ECF No. 27). (ECF No. 55).

On January 15, 2016, Plaintiff filed a Motion for Leave to file a Supplemental Memorandum in Support of its Motion for Preliminary Injunction and in Opposition to Defendant’s Motion for Judgment on the Pleadings. (ECF No. 56). On the same date, the Court granted Plaintiff’s Motion for Leave to File its Supplemental Memorandum. (ECF No. 57).

On January 22, 2016, Defendant filed an Opposition to Plaintiff’s Supplemental Memorandum. (ECF No. 59). Also on January 22, 2016, Defendant filed a Motion for Leave to File Status Report on Compliance with Hawaii Revised Statutes § 323F-57(a). (ECF No. 60).

On January 26, 2016, Defendant filed an Errata to its Motion for Leave to File a Status Report. (ECF No. 61).

On January 27, 2016, the Court issued a Minute Order granting Defendant’s Motion for Leave to File a Status Report. (ECF No. 62). On the same date, the Defendant filed its Status Report on Compliance with Hawaii Revised Statutes § 323F-57(a). (ECF No. 63).

On February 1, 2016, Defendant filed GOVERNOR IGE’S TEN DAYS’ NOTICE PRIOR TO DELIVERY OF DOCUMENTATION REGARDING REDUCTION-IN-FORCE. (ECF No. 64).

On February 2, 2016, Plaintiff filed a Motion for Leave to File Status Report Regarding Compliance with Hawaii Revised Statute Section 323F-57(a). (ECF No. 65).

On February 3, 2016, the Court issued a Minute Order granting Plaintiff’s Motion for Leave to file the Status Report and ordered Defendant to file a response. (ECF No. 66). On the same date, Plaintiff filed its Status Report. (ECF No. 67).

On February 8, 2016, Defendant filed its Response to Plaintiff’s Status Report Regarding Compliance with Hawaii Revised Statutes Section 323F-57(a). (ECF No. 70).

On February 9, 2016, the Court held a status conference as to the Parties’ status reports. Following the hearing, the Court rendered a ruling denying Plaintiff’s Motion for a Preliminary Injunction and granting Defendant’s Motion for Judgment on the Pleadings. (ECF No. 71). The Court stated a written order would be filed at a later date. (Id.) This written order sets forth the Court’s basis for the denial of Plaintiff’s Motion for a Preliminary Injunction and the grant of Defendant’s Motion for Judgment on the Pleadings.

BACKGROUND

The Plaintiff Union

Plaintiff is the United Public Workers, American Federation of State, County, Municipal Employees, Local 646, AFL-CIO (“Plaintiff”). Plaintiff is a labor union certified as the exclusive collective bargaining representative for approximately 11, 000 public employees in Hawaii. (Complaint at ¶ 8, ECF No. 1). Plaintiff represents approximately 1, 500 employees who work for the Hawaii Health Systems Corporation. (Id. at ¶ 18). The Hawaii Health Systems Corporation is a state agency that is responsible for the management of state-owned medical facilities. (Id. at ¶¶ 10, 13-14).

Plaintiff states that the Hawaii Health Systems Corporation employees it represents are members of two “bargaining units”: Unit 1 and Unit 10. (Id. at ¶ 18). Bargaining Unit 1 is comprised of non-supervisory blue-collar workers and Bargaining Unit 10 includes supervisory and non-supervisory workers in the institutional, health, and correctional workers unit of the Hawaii Health Systems Corporation. (Id. at ¶ 17).

The Collective Bargaining Agreements

Plaintiff alleges that the State of Hawaii and its Hawaii Health Systems Corporation are currently bound by two valid Collective Bargaining Agreements that they entered into with the Union’s Bargaining Units 1 and 10 employees. (Complaint at ¶¶ 29-30, ECF No. 1). The two Collective Bargaining Agreements are effective from July 1, 2013 through June 30, 2017. (Id.)

The Collective Bargaining Agreements govern some aspects of the employment relationship between members of Bargaining Units 1 and 10, and the Hawaii Health Systems Corporation. (Id. at ¶ 20). The Collective Bargaining Agreements regulate the terms and conditions of employment including wages, meal and rest periods, hours of work, holidays, sick leave, and fringe benefits. (Id.)

Act 103

In 2015, the Hawaii State Legislature adopted House Bill 1075. (Complaint at ¶ 31, ECF No. 1). On June 10, 2015, House Bill 1075 was signed into law by the Defendant Governor of the State of Hawaii, David Y. Ige, as Act 103. (Id.) Act 103 instructs the Defendant Governor to negotiate the transfer of operation and control of the Hawaii Health Systems Corporation’s Maui Regional System facilities to a private entity. (Id. at ¶ 32). Act 103 sets forth the terms of the transfer of the Maui Regional System facilities comprised of the Maui Memorial Medical Center, Kula Hospital and Clinic, and Lanai Community Hospital. (Id.)

Plaintiff alleges that the Defendant Governor intends to implement Act 103 before the Collective Bargaining Agreements expire in June 2017. Plaintiff argues that the Defendant Governor’s proposed implementation of Act 103 violates the Contract Clause of the United States Constitution. (Id. at ¶¶ 36, 53-57).

STANDARDS OF REVIEW

Judgment on the Pleadings Pursuant to Fed.R.Civ.P. 12(c)

Federal Rule of Civil Procedure 12(c) permits a party to move for judgment on the pleadings after the pleadings are closed. Judgment on the pleadings “is properly granted when there is no issue of material fact in dispute, and the moving party is entitled to judgment as a matter of law.” Fleming v. Pickard, 581 F.3d 922, 925 (9th Cir. 2009). For a Rule 12(c) motion, all material allegations contained in the nonmoving party’s pleadings are accepted as true. Hal Roach Studios v. Richard Feiner & Co., Inc., 896 F.2d 1542, 1550 (9th Cir. 1989); Chavez v. United States, 683 F.3d 1102, 1108 (9th Cir. 2012).

The district court’s review is generally limited to the contents of the complaint. The court may consider documents attached to the complaint, documents incorporated by reference in the complaint, or matters of judicial notice without converting the Rule 12(c) motion into a motion for summary judgment. Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001).

When a Rule 12(c) motion raises the defense of failure to state a claim, the standard governing the motion is the same as that governing a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). McGlinchy v. Shell Chemical Co., 845 F.2d 802, 810 (9th Cir. 1988). Rule 12(b)(6) allows dismissal where a complaint fails “to state a claim upon which relief can be granted.” Pareto v. F.D.I.C., 139 F.3d 696, 699 (9th Cir. 1998). Conclusory allegations of law and unwarranted inferences are insufficient to defeat such a motion. Id. The Court need not accept as true allegations that contradict matters properly subject to judicial notice or allegations contradicting the exhibits attached to the complaint. Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001).

Preliminary Injunction

A preliminary injunction is a matter of equitable discretion and is “an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief.” Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 22 (2008). A plaintiff seeking preliminary injunctive relief must establish:

(1) a likelihood of success on the merits;
(2) a likelihood of irreparable harm in the absence of the injunctive relief;
(3) that the balance of equities tips in favor of issuing the injunction; and,
(4) that issuing the injunction is in the public interest. Id. at 20.

The plaintiff bears the burden of making a clear showing on the four elements to demonstrate his entitlement to this extraordinary remedy. Earth Island Inst. v. ...


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