merit construction alliance v. quincy, ma, 1st cir. (2014)

7/26/2019 Merit Construction Alliance v. Quincy, MA, 1st Cir. (2014)

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United States Court of AppealsFor the First Circuit

No. 13- 2189

MERI T CONSTRUCTI ON ALLI ANCE ET AL. ,

Pl ai nt i f f s , Appel l ees ,

v.

CI TY OF QUI NCY,

Def endant , Appel l ant .

APPEAL FROM THE UNI TED STATES DI STRI CT COURT

FOR THE DI STRI CT OF MASSACHUSETTS

[ Hon. Rya W. Zobel , U. S. Di st r i ct J udge]

Bef or e

Thompson and Sel ya, Ci r cui t J udges,and McConnel l , * Di st r i ct J udge.

J ames S. Ti mmi ns, Ci t y Sol i ci t or , f or appel l ant .Chr i st opher N. Sour i s and Kr akow & Sour i s, LLC on br i ef f or

New Engl and Regi onal Counci l of Carpent ers, ami cus cur i ae.Chr i st opher C. Whi t ney, wi t h whomScot t K. Pomeroy and Pi erce

At wood LLP wer e on br i ef , f or appel l ees.Maur i ce Baski n and Li t t l er Mendel son, P. C. on br i ef f or

Associ at ed Bui l der s and Cont r act or s, I nc. , ami cus cur i ae.

J ul y 16, 2014

*Of t he Di st r i ct of Rhode I sl and, si t t i ng by desi gnat i on.


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SELYA, Circuit Judge. Thi s case pr esent s not one, but

t wo, quest i ons of consi der abl e i mpor t , each of whi ch i mpl i cat es t he

Empl oyee Ret i r ement I ncome Secur i t y Act of 1974 (ERI SA) , 29 U. S. C.

1001- 1461. The f i r st concer ns whet her t he r each of ERI SA' s

pr eempt i on pr ovi si on, 29 U. S. C. 1144( a) , extends t o a muni ci pal

or di nance mandat i ng t he est abl i shment of a speci f i c t ype of

appr ent i ce t r ai ni ng pr ogr am. The second concerns t he scope of

ERI SA' s f ee- shi f t i ng pr ovi si on, 29 U. S. C. 1132( g) ( 1) . Af t er

car ef ul consi der at i on, we concl ude t hat t he di st r i ct cour t answer ed

t he f i r st quest i on cor r ect l y, but not t he second. Accor di ngl y, we

af f i r m i n par t , r ever se i n par t , and r emand f or r econsi der at i on of

t he f ee award.

I. BACKGROUND

I n 2012, def endant - appel l ant Ci t y of Qui ncy ( t he Ci t y)

sol i ci t ed bi ds f or a const r uct i on pr oj ect at a mi ddl e school .

Woul d- be bi dder s wer e r equi r ed t o cert i f y compl i ance wi t h t he

Ci t y' s euphemi st i cal l y named Responsi bl e Empl oyer Or di nance ( t he

Or di nance) . Per t i nent l y, t he Or di nance demands t hat bi dder s on

muni ci pal publ i c wor ks pr oj ect s "engage[ ] i n a bona f i de appr ent i ce

t r ai ni ng pr ogr am" r egi st ered wi t h t he Massachuset t s Depart ment of

Labor St andar ds. Qui ncy, Mass. , Code 15. 26. 010( C) ; see Mass.

Gen. Laws ch. 23, 11H, 11I ( pr ovi di ng r el evant def i ni t i ons) .

The Or di nance f ur t her mandat es t hat at l east one apprent i ce have

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gr aduat ed f r om t he pr ogr am i n t he t wel ve mont hs i mmedi at el y

pr ecedi ng t he bi d. See Qui ncy, Mass. , Code 15. 26. 010( C) .

Thi s bi ddi ng condi t i on brought wi t h i t a l egal cl oud; a

f eder al di st r i ct cour t had r ul ed t hat ERI SA pr eempt ed a si mi l ar

or di nance passed i n Fal l Ri ver , Massachuset t s. See Ut i l . Cont r s.

Ass' n of New Eng. , I nc. v. Ci t y of Fal l Ri ver , No. 10- 10994, 2011

WL 4710875, at *7 ( D. Mass. Oct . 4, 2011) . Mer i t Const r uct i on

Al l i ance ( t he Al l i ance) , a t r ade associ at i on of const r uct i on

compani es, asked whet her t he Ci t y woul d cont i nue t o enf or ce i t s

appr ent i ce t r ai ni ng r equi r ement . When t he Ci t y r esponded

af f i r mat i vel y, 1 t he Al l i ance, j oi ned by t wo of i t s member s

( Gr asseschi Pl umbi ng & Heat i ng, I nc. and D' Agost i no Associ at es,

I nc. ) , and a Gr asseschi empl oyee (Davi d Ross) , sued t he Ci t y i n t he

f eder al di st r i ct cour t . Among ot her t hi ngs, t he compl ai nt sought

i nj unct i ve and decl ar at or y rel i ef on t he gr ound t hat ERI SA

pr eempt ed the Or di nance' s appr ent i ce t r ai ni ng requi r ement . 2

1 The Ci t y' s af f i r mat i ve r esponse i ndi cat ed t hat i t woul dsuspend enf orcement of t he gr aduat i on r equi r ement i n connect i onwi t h t hi s bi d sol i ci t at i on. Because of t he l i mi t ed nat ur e of t hesuspensi on, we t hi nk t hat i t i s appr opr i at e t o i ncl ude t hegr aduat i on r equi r ement i n t he over al l pr eempt i on cal cul us.

2The pl ai nt i f f s i ni t i al l y chal l enged sever al ot her pr ovi si onsof t he Or di nance. The Ci t y agr eed not t o enf or ce some of t hesepr ovi si ons, and t he l i t i gat i on nar r owed t o f ocus on t wo pr ovi si ons:t he Or di nance' s r esi dency r equi r ement and i t s appr ent i ce t r ai ni ngr equi r ement . Event ual l y, t he Ci t y conceded t he f or mer i ssue and,t hus, t hi s appeal concer ns onl y t he l at t er .

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The di st r i ct cour t grant ed a prel i mi nar y i nj unct i on

bar r i ng enf or cement of t he appr ent i ce t r ai ni ng r equi r ement , based

l ar gel y on i t s ear l i er deci si on i n t he Fal l Ri ver case. See Mer i t

Const r . Al l . v. Ci t y of Qui ncy ( Mer i t I ) , No. 12- 10458, 2012 WL

1357656, at *2, *4 ( D. Mass. Apr . 18, 2012) . Summary j udgment i n

f avor of t he pl ai nt i f f s f ol l owed apace. See Mer i t Const r . Al l . v.

Ci t y of Qui ncy ( Mer i t I I ) , No. 12- 10458, 2013 WL 396123, at *3 (D.

Mass. Feb. 1, 2013) .

To t he vi ct or bel ong t he spoi l s, and t he next st age of

t he bat t l e i nvol ved at t or neys' f ees. The di st r i ct cour t gr ant ed

t he pl ai nt i f f s' mot i on f or f ees and awar ded t hem t he amount of

$81, 007. 85. See Mer i t Const r . Al l . v. Ci t y of Qui ncy ( Mer i t I I I ) ,

No. 12- 10458, 2013 WL 3984596, at *3 ( D. Mass. Aug. 2, 2013) . The

Ci t y unsuccessf ul l y sought r econsi der at i on of t he f ees or der . See

Mer i t Const r . Al l . v. Ci t y of Qui ncy ( Mer i t I V) , No. 12- 10458, 2013

WL 4446935, at *3 ( D. Mass. Aug. 21, 2013) . Thi s t i mel y appeal

f ol l owed.

II. ANALYSIS

I n t hi s venue, t he Ci t y f or t he f i r st t i me quest i ons t he

pl ai nt i f f s' st andi ng t o sue. Because t hi s chal l enge i mpl i cat es

subj ect mat t er j ur i sdi ct i on, we ar e obl i gat ed t o addr ess i t despi t e

i t s l at eness. See Am. Fi ber & Fi ni shi ng, I nc. v. Tyco Heal t hcar e

Gr p. , LP, 362 F. 3d 136, 138- 39 ( 1st Ci r . 2004) ( "[ I ] t i s f i r ml y

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set t l ed t hat chal l enges t o f eder al subj ect mat t er j ur i sdi ct i on may

be r ai sed f or t he f i r st t i me on appeal . ") .

The Const i t ut i on l i mi t s f eder al - cour t j ur i sdi ct i on t o

actual cases and cont r over si es. See U. S. Const . ar t . I I I , 2. I n

l i ne wi t h t hi s l i mi t at i on, a l i t i gant seeki ng t o enl i st f eder al

cour t j ur i sdi ct i on must demonst r at e hi s st andi ng t o br i ng sui t : he

must have "such a personal st ake i n t he out come of t he cont r oversy

as t o assure t hat concr ete adver seness whi ch shar pens t he

pr esent at i on of i ssues. " Baker v. Car r , 369 U. S. 186, 204 ( 1962) .

When an uni ncorporated associ at i on seeks t o open t he

door s of a f eder al cour t , i t must demonst r at e t hat " ( a) i t s member s

woul d ot her wi se have st andi ng t o sue i n t hei r own r i ght ; ( b) t he

i nt er est s i t seeks t o pr ot ect ar e ger mane t o t he or gani zat i on' s

pur pose; and ( c) nei t her t he cl ai m asser t ed nor t he r el i ef

r equest ed r equi r es t he par t i ci pat i on of i ndi vi dual member s i n t he

l awsui t . " Hunt v. Wash. St ate Appl e Adver . Comm' n, 432 U. S. 333,

343 ( 1977) . For an i ndi vi dual t o have st andi ng, he must est abl i sh

i nj ur y i n f act , causat i on, and r edr essabi l i t y. See Luj an v.

Def ender s of Wi l dl i f e, 504 U. S. 555, 560- 61 ( 1992) .

The f i r st el ement of t hi s t r i ad i nqui r es i nto t he

exi st ence of "an i nvasi on of a l egal l y pr ot ect ed i nt er est whi ch i s

( a) concr et e and par t i cul ar i zed and ( b) act ual or i mmi nent , not

conj ect ur al or hypot het i cal . " I d. at 560 ( i nt er nal quot at i on mar ks

and ci t at i ons omi t t ed) . The second el ement asks whet her t he

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al l eged i nj ur y i s "f ai r l y t r aceabl e t o t he chal l enged act i on of t he

def endant . " I d. ( i nt er nal quot at i on mar k and al t er at i ons omi t t ed) .

The t hi r d el ement asks whet her i t i s " l i kel y, as opposed t o mer el y

specul at i ve, t hat t he i nj ur y wi l l be r edr essed by a f avor abl e

deci si on. " I d. at 561 ( i nt er nal quot at i on mar ks omi t t ed) .

The Al l i ance' s member s pass t hi s t r i part i t e t est wi t h

f l yi ng col or s. Among t hei r r anks ar e cont r act or s t hat nei t her

mai nt ai n appr ent i ce t r ai ni ng pr ogr ams nor sat i sf y the Or di nance' s

gr aduat i on quota. Those members suf f er i nj ur y because they want t o

bi d on publ i c wor ks pr oj ect s i n Qui ncy but ar e const r ai ned f r om

doi ng so by t he st r i ctur es of t he Or di nance. I f t he pl ai nt i f f s

pr evai l , t he Or di nance wi l l be decl ar ed nul l and voi d, t hus

r emovi ng t he i nj ur y- causi ng obst r uct i on t o t hei r bi ddi ng

el i gi bi l i t y.

Si mi l ar l y, t he Al l i ance meet s t he cri t er i a f or

associ at i onal st andi ng. At l east some of i t s member s have

i ndi vi dual st andi ng, and pr eservi ng i t s member s' bi ddi ng

capabi l i t i es cl osel y r el at es t o i t s r ai son d' t r e. To ci nch

mat t er s, nothi ng about an ERI SA pr eempt i on chal l enge cal l s f or

enl i st i ng t he par t i ci pat i on of i ndi vi dual Al l i ance member s. See

Ret ai l I ndus. Leader s Ass' n v. Fi el der , 475 F. 3d 180, 187 ( 4t h Ci r .

2007) .

The Ci t y, i n ef f ect , at t empts t o conf ess and avoi d. I t

di sput es none of t he concl usi ons r ecount ed above but , r at her , t r i es

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t o gr af t a r equi r ement of an ERI SA- cover ed appr ent i ce t r ai ni ng

pr ogr am ont o t he t est f or const i t ut i onal st andi ng. Thi s i s pi e i n

t he sky: t he Ci t y of f er s no aut hor i t y f or t he pr oposi t i on t hat t he

Const i t ut i on i mposes any such r equi r ement .

Of cour se, ERI SA' s st at ut or y enf or cement pr ovi si on

cont empl ates t he exi st ence of an ERI SA pl an. See 29 U. S. C.

1132( a) ( 3) . But t he quest i on of st andi ng t hat t he Ci t y r ai ses

her e i s const i t ut i onal i n nat ur e, and we see no r eason t hat such a

condi t i on i s necessar y t o r ender t hi s act i on an act ual case or

cont r over sy wi t hi n t he meani ng of Ar t i cl e I I I . See Wr i ght

El ect r i c, I nc. v. Mi nn. St at e Bd. of El ec. , 322 F. 3d 1025, 1028- 29

( 8t h Ci r . 2003) ( hol di ng t hat pl ai nt i f f need not "show t hat i t s

appr ent i ceshi p pr ogr am was an ERI SA pl an i n or der t o est abl i sh

subj ect mat t er j ur i sdi ct i on") . We t her ef or e hol d t hat t he Al l i ance

has st andi ng t o chal l enge the Or di nance on t he gr ound of ERI SA

preempt i on.

Havi ng determi ned t hat an actual case and cont r oversy

exi st s, we pr oceed t o chew on t he meat of t he appeal : pr eempt i on

and at t or neys' f ees. We addr ess t hese subj ect s sequent i al l y.

A. Preemption.

The Ci t y ass i gns er r or t o t he di st r i ct cour t ' s r ul i ng

t hat ERI SA pr eempt s t he Or di nance' s appr ent i ce t r ai ni ng

r equi r ement . Si nce thi s r ul i ng was made on summary j udgment , our

r evi ew i s pl enar y. See Geshke v. Cr ocs, I nc. , 740 F. 3d 74, 76 ( 1st

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Ci r . 2014) ; see al so Car pent er s Local Uni on No. 26 v. U. S. Fi d. &

Guar . Co. , 215 F. 3d 136, 139 ( 1st Ci r . 2000) .

"ERI SA i s a compr ehensi ve st atut e desi gned t o pr omote the

i nt er est s of empl oyees and t hei r benef i ci ar i es i n empl oyee benef i t

pl ans. " Shaw v. Del t a Ai r Li nes, I nc. , 463 U. S. 85, 90 ( 1983) .

Enact ed i n par t " t o saf eguard empl oyees f r om t he abuse and

mi smanagement of f unds t hat had been accumul at ed t o f i nance var i ous

t ypes of empl oyee benef i t s, " t he st at ut or y scheme "sets f or t h

r epor t i ng and di scl osur e obl i gat i ons f or pl ans, i mposes a f i duci ar y

st andar d of car e f or pl an admi ni st r at or s, and est abl i shes schedul es

f or t he vest i ng and accr ual of pensi on benef i t s. " Massachuset t s v.

Morash, 490 U. S. 107, 112- 13 ( 1989) .

When consi der i ng a cl ai m of pr eempt i on, "our t ask i s t o

ascer t ai n Congr ess' i nt ent i n enact i ng t he f eder al st at ut e at

i ssue. " Shaw, 463 U. S. at 95. Wi t h r espect t o ERI SA, t hi s i nt ent

i s expr ess, i f somewhat "opaque. " De Buono v. NYSA- I LA Med. &

Cl i ni cal Ser vs. Fund, 520 U. S. 806, 809 ( 1997) . By i t s t er ms and

subj ect t o exempt i ons not r el evant her e, ERI SA "super sede[ s] any

and al l St at e l aws i nsof ar as t hey may now or her eaf t er r el at e t o

any empl oyee benef i t pl an. " 29 U. S. C. 1144( a) .

The Supr eme Cour t has di st i l l ed t he st at ute' s " r el at e t o"

l anguage i nt o t wo i ndependent l y suf f i ci ent al t er nat i ves: "a

connect i on wi t h or r ef er ence t o" an ERI SA pl an wi l l r esul t i n

pr eempt i on. Shaw, 463 U. S. at 97. Under t hi s t wo- si ded r ubr i c,

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Of cour se, not ever y concei vabl e connect i on wi l l suppor t

pr eempt i on. For exampl e, st at e l aws t hat mer el y exer t an " i ndi r ect

economi c i nf l uence" on a pl an do "not bi nd pl an admi ni st r at or s t o

any par t i cul ar choi ce" and, t hus, do not come wi t hi n ERI SA' s

pr eempt i ve r each. Cal . Di v. of Labor St andar ds Enf or cement v.

Di l l i ngham Const r . , I nc. , 519 U. S. 316, 329 ( 1997) ( i nt er nal

quot at i on mar ks omi t t ed) . On t he ot her hand, "st at e st at ut es t hat

' mandat e[ ] empl oyee benef i t st r uct ur es or t hei r admi ni st r at i on'

. . . amount [ ] t o ' connect i on[ s] wi t h' ERI SA pl ans" and ar e

t her ef or e pr eempt ed. I d. at 328 ( f i nal al t er at i on i n or i gi nal )

( quot i ng Tr avel er s, 514 U. S. at 658) .

The pat h f r om i nf l uence t o coer ci on amount s t o a

cont i nuum and i t i s not al ways a si mpl e t ask t o det er mi ne wher e

al ong t hi s cont i nuuma par t i cul ar st at e l aw f al l s. See Tr avel er s,

514 U. S. at 668; see al so Samuel C. Sal gani k, Not e, What t he

Unconst i t ut i onal Condi t i ons Doct r i ne Can Teach Us About ERI SA

Pr eempt i on: I s I t Possi bl e To Consi st ent l y I dent i f y "Coer ci ve" Pay-

or - Pl ay Schemes?, 109 Col um. L. Rev. 1482, 1515- 19 ( 2009) . Thi s

case, however , does not gr eat l y t ax our capaci t y f or di scernment :

t he Or di nance cat egor i cal l y r equi r es al l cont r act or s on Qui ncy

publ i c wor ks pr oj ect s t o oper at e a Massachuset t s- appr oved

appr ent i ce t r ai ni ng pr ogr am. See Qui ncy, Mass. , Code

15. 26. 010( C) . I ncor por at i ng t he st at e' s st andar ds i mposes a r af t

of st r i ngent condi t i ons on woul d- be bi dder s i ncl udi ng, among

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ot her s, document at i on of t he pr ogr am' s t er ms and condi t i ons, see

453 Mass. Code Regs. 7. 03( 8) ( b) ; t he l ocat i on of t he pr ogr am' s

appr ent i ce acti vi t i es, see i d. 7. 03( 8) ( e) ; t r ai ni ng and

i nst r ucti on, see i d. 7. 04( 1) ( b) ( 1) - ( 4) ; wage r at es, see i d.

7. 04( 1) ( b) ( 5) ; r ecor dkeepi ng, see i d. 7. 04( 1) ( b) ( 23) , 7. 13;

i nst r uctor qual i f i cat i ons, see i d. 7. 04( 2) ; appr ent i ce enr ol l ment ,

see i d. 7. 07( 1) ; r epor t i ng, see i d. 7. 07( 2) ; and t er mi nat i on, see

i d. 7. 08(3) . For good measur e ( or bad measur e dependi ng on one' s

poi nt of vi ew) , t he Or di nance separ at el y requi r es a def i ned

gr aduat i on r at e. See Qui ncy, Mass. , Code 15. 26. 010( C) .

Wi t h such a compendi umof st i pul at i ons i n pl ace, we have

no di f f i cul t y concl udi ng t hat t he Or di nance goes f ar beyond si mpl y

i nf l uenci ng ERI SA appr ent i ce t r ai ni ng pr ogr ams. I t mandat es an

empl oyee benef i t st r uct ur e and speci f i es how t hat st r uct ur e must be

admi ni st er ed. Thi s i s si mpl y t oo i nt r usi ve t o wi t hst and ERI SA

preempt i on.

The Ci t y bal ks. I t asser t s t hat even i f i t s Or di nance

const i t ut es a mandate, t hat shoul d not be t he end of t he mat t er .

I n suppor t , i t suggest s t hat "[ t ] he key di st i nct i on i s bet ween a

st at ut e t hat mandat es or ef f ect i vel y mandat es an aspect of l aw wi t h

whi ch ERI SA i s concer ned . . . and a st at ut e t hat does not . "

Assoc' d Bui l der s & Cont r s. v. Mi ch. Dep' t of Labor & Econ. Gr owt h,

543 F. 3d 275, 280 ( 6t h Ci r . 2008) . ERI SA i s a st at ut e concer ned

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wi t h f undi ng, i t s t hesi s r uns, and l ocal r egul at i on of appr ent i ce

t r ai ni ng st andar ds i s t oo remot e to war r ant ERI SA pr eempt i on.

Thi s asser t i on i s t r ue as f ar as i t goes, but i t does not

t ake t he Ci t y ver y f ar . ERI SA "has more t han one pur pose. " Si mas

v. Quaker Fabr i c Cor p. , 6 F. 3d 849, 856 ( 1st Ci r . 1993) . I n

addi t i on t o f undi ng concer ns, "[ t ] he uni f or mi t y of r egul at i on

gai ned by empl oyers under ERI SA was assur edl y part of t he

l egi sl at i ve bal anci ng of i nt er est s and t r ade- of f s. " I d.

The Or di nance pl ai nl y di st urbs t hat bal ance. Let us

of f er an exampl e. Al t hough t he Or di nance r equi r es t he gr aduat i on

of at l east one appr ent i ce wi t hi n t he pr evi ous t wel ve mont hs, see

Qui ncy, Mass. , Code 15. 26. 010( C) , Fal l Ri ver ' s count er par t

or di nance requi r ed t he gr aduat i on of at l east t wo appr ent i ces per

year f or t he t hr ee year s pr i or t o a bi d, see Ut i l . Cont r s. Ass' n,

2011 WL 4710875, at *7. Accor di ngl y, compl i ance wi t h t he Ci t y' s

f or mul a woul d not ef f ect compl i ance wi t h Fal l Ri ver ' s; and so t he

Or di nance woul d " r equi r [ e] t he t ai l or i ng of pl ans and empl oyer

conduct t o t he pecul i ar i t i es of t he l aw of each j ur i sdi ct i on. "

I nger sol l - Rand Co. v. McCl endon, 498 U. S. 133, 142 ( 1990) . Such a

r esul t woul d be "f undament al l y at odds wi t h t he goal of uni f or mi t y

t hat Congr ess sought t o i mpl ement " t hr ough the enactment of ERI SA.

I d.

Ther e i s yet anot her r eason why t he Ci t y' s ar gument does

not wor k. The Di l l i nghamCour t , whi l e f i ndi ng no pr eempt i on t her e,

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was car ef ul t o di st i ngui sh si t uat i ons i n whi ch an "appr ent i ceshi p

pr ogr am i s r equi r ed by [ st at e] l aw t o meet [ t he st at e' s]

st andar ds. " 519 U. S. at 332. The Or di nance t r i ps t hi s snar e: i t

not onl y mandat es t he st andar ds t hat appr ent i ce t r ai ni ng pr ogr ams

must f ol l ow but al so mandates t hat empl oyers act ual l y have such

pr ogr ams i n pl ace as a condi t i on of bi ddi ng. Thi s dual mandate

goes t oo f ar : not even "di schar gi ng al l of i t s appr ent i ces wi l l

r el ease an empl oyer or a pr ogr amf r omt he r each" of t he Or di nance.

Assoc' d Bui l der s, 543 F. 3d at 282. Because t he Or di nance

unqual i f i edl y demands t he mai nt enance of a speci f i c t ype of

appr ent i ce t r ai ni ng pr ogr am as a condi t i on of bi ddi ng, i t exceeds

t he boundar i es of what ERI SA al l ows. See Mi nn. Chapt er of Assoc' d

Bui l der s & Cont r s. , I nc. v. Mi nn. Dep' t of Pub. Saf et y, 267 F. 3d

807, 818 ( 8t h Ci r . 2001) .

I n an ef f or t t o change t he t r aj ect or y of t he debat e, t he

Ci t y seeks t o wr ap i t sel f i n t he mant l e of t he Cour t ' s st at ement

t hat "an empl oyee benef i t pr ogr am not f unded thr ough a separ at e

f und i s not an ERI SA pl an. " Di l l i ngham, 519 U. S. at 326 ( emphasi s

i n or i gi nal ) . Such a pl an can be used t o compl y wi t h t he Or di nance

and, i n t he Ci t y' s vi ew, t he avai l abi l i t y of t hi s non- ERI SA avenue

t o compl i ance ought t o pr et er mi t a f i ndi ng t hat t he Or di nance

r el at es t o ERI SA pl ans.

Thi s i s anf r act uous r easoni ng. " [ W] het her a Stat e

r equi r es an exi st i ng pl an t o pay cer t ai n benef i t s, or whet her i t

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r equi r es t he est abl i shment of a separ at e pl an where none exi st ed

bef or e, t he pr obl em i s t he same. " For t Hal i f ax Packi ng Co. v.

Coyne, 482 U. S. 1, 13 ( 1987) . A pl an admi ni st r ator put t o such a

choi ce i s st i l l "[ f ] aced wi t h t he di f f i cul t y or i mpossi bi l i t y of

st r uct ur i ng admi ni st r at i ve pr act i ces accor di ng t o a set of uni f or m

gui del i nes. " I d.

The l esson of For t Hal i f ax i s per t i nent her e. To compl y

wi t h the Or di nance, an empl oyer wi t h an ERI SA- governed appr ent i ce

t r ai ni ng pr ogr am ei t her woul d have t o modi f y that pr ogr am t o

pr ovi de appr ent i ces on Qui ncy- based pr oj ect s wi t h speci al benef i t s

or woul d have t o est abl i sh and coor di nate a separ at e pl an i nt o

whi ch such appr ent i ces woul d be f unnel ed. Ei t her way, t he

empl oyer ' s hope of uni f or m admi ni st r at i on woul d be dashed by t he

Or di nance' s demands. Such bal kani zat i on of benef i t admi ni st r at i on

i s exact l y t he sor t of out come ERI SA was desi gned t o pr event . The

upshot i s t o def enest r at e t he Ci t y' s i nsi st ence t hat we at t ach

decr et or y si gni f i cance t o an empl oyer ' s abi l i t y t o compl y wi t h t he

Or di nance by means of a non- ERI SA pl an. See Mi nn. Chapt er of

Assoc' d Bui l der s, 267 F. 3d at 817; cf . Egel hof f v. Egel hof f ex r el .

Br ei ner , 532 U. S. 141, 150- 51 ( 2001) ( hol di ng t hat an abi l i t y t o

opt out of a st at e l aw does not save t he l aw f r om pr eempt i on) .

The deci si on i n Gol den Gat e Rest aur ant Ass' n v. Ci t y &

Count y of San Fr anci sco, 546 F. 3d 639 ( 9t h Ci r . 2008) , l oudl y

br ui t ed by t he Ci t y, i s not t o t he cont r ar y. Ther e, t he Ni nt h

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Ci r cui t hel d t hat r equi r i ng a cer t ai n l evel of heal t h- car e

expendi t ur es whi ch mi ght , but need not , be spent t hr ough an ERI SA

pl an di d not t r i gger ERI SA pr eempt i on. See i d. at 646, 661. But

t he cour t di d not pur pose t o l ay down a bl anket r ul e that whenever

compl i ance can come t hr ough a non- ERI SA opt i on, ERI SA preempt i on i s

unavai l abl e. I nst ead, t he cour t r ecogni zed t hat st at e l aws t hat

" r equi r ed empl oyer s t o have [ benef i t ] pl ans, and . . . di ct at ed t he

speci f i c benef i t s empl oyer s wer e to pr ovi de thr ough t hose pl ans"

woul d be pr eempt ed. I d. at 655.

The Ci t y next cont ends t hat t he Fi t zger al d Act , 29 U. S. C.

50, somehow ai ds i t s cause. That cont ent i on i s f r ui t l ess. Whi l e

t he Fi t zger al d Act "r ecogni zed pr e- exi st i ng st at e ef f or t s i n

r egul at i ng appr ent i ceshi p pr ogr ams, " Di l l i ngham, 519 U. S. at 330,

not hi ng i n t hat st at ut e i ndi cat es a congr essi onal i nt ent i on t o

sanct i on l ocal ef f or t s t o mandat e st at e- appr oved appr ent i ce

t r ai ni ng pr ogr ams.

Looki ng f or comf or t i n any quar t er , t he Ci t y pr oposes an

anal ogy t o the Supr eme Cour t ' s s t atement t hat a st ate "may f orce

t he empl oyer t o choose bet ween pr ovi di ng di sabi l i t y benef i t s i n a

separ at el y admi ni st er ed pl an and i ncl udi ng t he st at e- mandat ed

benef i t s i n i t s ERI SA pl an. " Shaw, 463 U. S. at 108. That

pr onouncement has no t r act i on her e: i t i s anchor ed i n a st at ut or y

exempt i on f r om ERI SA f or pl ans " mai nt ai ned sol el y f or t he pur pose

of compl yi ng wi t h . . . di sabi l i t y i nsur ance l aws. " 29 U. S. C.

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1003( b) ( 3) . No comparabl e exempt i on anchors t he Ci t y' s pr oposed

anal ogy.

Scr api ng t he bot t om of t he bar r el , t he Ci t y assever at es

t hat i n passi ng t he Or di nance, i t mer el y act ed as a par t i ci pant i n

t he mar ket f or const r uct i on ser vi ces. Thi s r ol e, i t says,

i mmuni zes i t s act i ons f r om ERI SA pr eempt i on. See Car di nal Towi ng

& Aut o Repai r , I nc. v. Ci t y of Bedf or d, 180 F. 3d 686, 691 ( 5t h Ci r .

1999) ( hol di ng t hat "when a st at e or muni ci pal i t y act s as a

part i ci pant i n t he market and does so i n a narr ow and f ocused

manner consi st ent wi t h the behavi or of ot her mar ket par t i ci pant s,

such act i on does not const i t ut e r egul at i on subj ect t o pr eempt i on") ;

see al so Reeves, I nc. v. St ake, 447 U. S. 429, 436 ( 1980) ( dr awi ng

di st i nct i on "bet ween St at es as mar ket par t i ci pant s and St at es as

market r egul ators" f or Commerce Cl ause pur poses) .

Thi s asseverat i on st al l s bef or e i t st ar t s. The Ci t y

f ai l ed t o rai se t hi s i ssue i n i t s summar y j udgment paper s and,

"[ i ] f any pr i nci pl e i s set t l ed i n t hi s ci rcui t , i t i s that , absent

t he most ext r aor di nar y ci r cumst ances, l egal t heor i es not r ai sed

squar el y i n t he l ower cour t cannot be br oached f or t he f i r st t i me

on appeal . " Teamst er s Uni on, Local No. 59 v. Super l i ne Transp.

Co. , 953 F. 2d 17, 21 ( 1st Ci r . 1992) . The mar ket par t i ci pat i on

t heor y i s, t her ef or e, not pr oper l y bef or e us. 3

3 To be sur e, t he Ci t y pr ot est s t hat i t s mar ket par t i ci pat i ont heor y sur f aced dur i ng t he pr el i mi nar y i nj unct i on pr oceedi ngs. But" [ t ] he di st r i ct cour t was under no obl i gat i on t o rummage thr ough

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We summar i ze succi nct l y. ERI SA speci f i cal l y i ncl udes

appr ent i ce t r ai ni ng pr ogr ams i n i t s def i ni t i on of empl oyee wel f ar e

benef i t pl ans. A st at e- l aw mandat e r egar di ng t he st r uct ur e or

admi ni st r at i on of such pl ans f al l s wi t hi n t he ambi t of ERI SA' s

pr eempt i on pr ovi si on. The Or di nance compr i ses such a mandate

because i t di ct at es t he est abl i shment of an empl oyee benef i t

st r uct ur e and sets t he st andar ds gover ni ng t hat s t r uct ur e. Even

t hough a non- ERI SA opt i on mi ght be avai l abl e f or compl i ance wi t h

t he Or di nance, t he avai l abi l i t y of such an opt i on does not save t he

Or di nance: i t s mandat e st i l l has t he ef f ect of dest r oyi ng t he

benef i t of uni f or m admi ni st r at i on t hat i s among ERI SA' s pr i nci pal

goal s.

That ends t hi s aspect of t he mat t er . We concl ude t hat

ERI SA pr eempt s t he Or di nance and af f i r mt he di st r i ct cour t ' s gr ant

of summar y j udgment .

B. Attorneys' Fees.

Thi s l eaves t he i ssue of at t or neys' f ees. Af t er ent er i ng

summar y j udgment , t he di st r i ct cour t , r espondi ng t o t he pl ai nt i f f s'

mot i on, awar ded t he pl ai nt i f f s at t or neys' f ees t ot al i ng $81, 007. 85

under ERI SA' s f ee- shi f t i ng pr ovi si on, 29 U. S. C. 1132( g) ( 1) , and

[ t he Ci t y' s] pr el i mi nar y i nj unct i on f i l i ngs" when cont empl at i ngsummary j udgment . CMM Cabl e Rep, I nc. v. Ocean Coast Props. , I nc. ,97 F. 3d 1504, 1526 ( 1st Ci r . 1996) . The di sposi t i ve ci r cumst ancei s t hat t he Ci t y f ai l ed, di r ectl y or i ndi r ectl y, t o advance amarket par t i ci pat i on def ense i n r esponse t o t he summary j udgmentmot i on. See i d.

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t he Fees Act , 42 U. S. C. 1988. The Ci t y conceded bel ow t hat a

por t i on of t hi s awar d ( $20, 725) cor r esponded t o t he pl ai nt i f f s'

successf ul ef f or t s i n st r i ki ng t he r esi dency r equi r ement f r om t he

Or di nance and, t hus, was pr oper l y awarded under 42 U. S. C. 1988. 4

However , t he di st r i ct cour t di d not make such a di f f er ent i at i on;

r ather , i t awarded a gl obal amount t hat covered both work done i n

at t acki ng the resi dency r equi r ement and wor k done i n at t acki ng t he

appr ent i ce t r ai ni ng r equi r ement . See Mer i t I I I , 2013 WL 3984596,

at *2- 3. Whi l e t he di st r i ct cour t i ndi cat ed t hat bot h 42 U. S. C.

1988 and 29 U. S. C. 1132( g) ( 1) wer e i n pl ay, i t di d not br eak

down t he f ee award al ong t hose l i nes. See i d.

ERI SA' s f ee- shi f t i ng pr ovi si on per mi t s a di st r i ct cour t

t o "al l ow a r easonabl e at t or ney' s f ee and cost s of act i on" f or an

"act i on under t hi s subchapt er . . . by a par t i ci pant , benef i ci ar y,

or f i duci ar y. " 29 U. S. C. 1132( g) ( 1) . The Ci t y cont ends t hat t he

di st r i ct cour t l acked aut hor i t y to make any f ee awar d under t hi s

pr ovi s i on. I t s obj ect i ons ar e t wof ol d. Fi r st , i t asser t s t hat t he

pl ai nt i f f s' act i on was not an "act i on under t hi s subchapt er . "

Second, i t asser t s t hat no pl ai nt i f f qual i f i es as a "par t i ci pant ,

benef i ci ar y, or f i duci ar y" of an ERI SA pl an as t hat phr ase i s used

i n t he f ee- shi f t i ng st at ut e.

4 The pl ai nt i f f s have not agr eed t hat t hei r f ees f or wor k i nconnect i on wi t h t he r esi dency r equi r ement ar e l i mi t ed t o t hi samount . That i ssue r emai ns open f or expl orat i on on r emand. Seet ext i nf r a.

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Her e, t oo, a pr ocedur al obst acl e l ooms. The Ci t y

advanced t hese obj ect i ons f or t he f i r st t i me i n i t s mot i on f or

r econsi derat i on of t he f ee award. To succeed on such a mot i on,

" t he movant must demonst r ate ei t her t hat newl y di scover ed evi dence

( not pr evi ousl y avai l abl e) has come t o l i ght or t hat t he r ender i ng

cour t commi t t ed a mani f est er r or of l aw. " Cal der n- Ser r a v.

Wi l mi ngt on Tr ust Co. , 715 F. 3d 14, 20 ( 1st Ci r . 2013) ( i nt er nal

quotat i on mark omi t t ed) . We r evi ew t he deni al of such a mot i on f or

abuse of di scr et i on. See i d.

Thi s obst acl e i s f or mi dabl e but i t i s not

i nsur mount abl e. Al t hough a di st r i ct cour t has subst ant i al

di scret i on i n eval uat i ng a mot i on f or r econsi der at i on, "subst ant i al

di scr et i on i s not unbr i dl ed di scr et i on. " Wei nber ger v. Gr eat N.

Nekoosa Cor p. , 925 F. 2d 518, 528 ( 1st Ci r . 1991) . As her e, a

mani f est er r or of l aw may out st r i p t he boundar i es of even t hat wi de

di scret i on. See, e. g. , Max' s Seaf ood Caf ex r el . Lou- Ann, I nc. v.

Qui nt eros, 176 F. 3d 669, 678- 79 ( 3d Ci r . 1999) ; Edward Gr ay Corp.

v. Nat ' l Uni on Fi r e I ns. Co. , 94 F. 3d 363, 367- 69 ( 7t h Ci r . 1996) .

As we expl ai n bel ow, we t hi nk t hat t hi s i s t he unusual case i n

whi ch t he er r or was so mani f est t hat t he mot i on f or r econsi der at i on

shoul d have been gr ant ed.

Wi t h r espect t o t he Ci t y' s f i r st poi nt whet her a

pr eempt i on chal l enge qual i f i es as an "act i on" f or t he pur poses of

29 U. S. C. 1132( g) ( 1) t he di st r i ct cour t acknowl edged t hat t he

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quest i on i s "cl ose. " Mer i t I V, 2013 WL 4446935, at *2. 5 Thi s i s

an accur at e char act er i zat i on, but we do not need t o pur sue t he

quest i on: r egar dl ess of whet her t hi s case qual i f i es as t he t ype of

"act i on" necessar y t o engage t he gear s of ERI SA' s f ee- shi f t i ng

pr ovi si on, we cannot di scer n an appr opr i at e "par t i ci pant ,

benef i ci ar y, or f i duci ar y" t o whomf ees coul d l awf ul l y be awar ded.

As bot h t he pl ai nt i f f s and t he di st r i ct cour t concede,

t he onl y possi bi l i t y i s pl ai nt i f f Ross. But t her e i s a r ub: Ross

i s not a par t i ci pant , benef i ci ar y, or f i duci ar y of any ERI SA

appr ent i ce t r ai ni ng pr ogr am.

Ross' s st andi ng as an el i gi bl e "par t i ci pant " r el i es

i nst ead upon hi s st at us as a par t i ci pant i n hi s empl oyer ' s 401( k)

pl an a pl an t hat i s whol l y unr el at ed t o the cont est ed appr ent i ce

t r ai ni ng r equi r ement . Such r el i ance depends, i n t ur n, upon r eadi ng

t he ERI SA f ee- shi f t i ng st at ut e i n t he br oadest possi bl e sense. On

t hat vi r t ual l y l i mi t l ess vi ew, t he "par t i ci pant , benef i ci ar y, or

f i duci ar y" descr i bed i n t he st at ut e need not have any nexus t o a

r el evant ERI SA pl an: any ERI SA pl an wi l l do.

5 The di st r i ct cour t specul at ed t hat t he act i on mi ght bevi ewed as one t o "enf or ce" ERI SA' s pr eempt i on pr ovi si on. Mer i t I V,2013 WL 4446935, at *2. Thi s specul at i on i s puzzl i ng i n l i ght oft he di st r i ct cour t ' s ear l i er hol di ng ( i n t he Fal l Ri ver case) t hat

t he pr eempt i on chal l enge was not "an act i on or [ a] r equest [ f or ]r el i ef under t he ci vi l enf or cement sect i on of ERI SA. " Ut i l .Cont r s. Ass' n, 2011 WL 4710875, at *3; see Ri char d H. Fal l on, J r .et al . , Har t and Wechsl er ' s The Feder al Cour t s and t he Feder alSyst em 712 ( 6t h ed. 2009) ( st at i ng t hat pr eempt i on chal l enges t ost at e l aw ar e r out i nel y al l owed "wi t hout expr ess st at ut or yaut hor i zat i on") .

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We ar e conf i dent t hat t he t ext of t he st at ut e i s not

el ast i c enough t o al l ow so expansi ve an i nt er pr et at i on. The

pl ai nt i f f s of f er no case l aw or l egi sl at i ve hi st or y f or t he

ext r aor di nar y pr oposi t i on t hat Congr ess i nt ended par t i ci pat i on i n

a si ngl e ( unr el at ed) ERI SA pl an t o conf er an unf et t er ed r i ght t o

col l ect at t or neys' f ees i n any ERI SA act i on. Thi s l ack of

aut hor i t y i s unsur pr i si ng: under t he so- cal l ed Amer i can r ul e,

l i t i gant s ar e gener al l y r esponsi bl e f or t he r emuner at i on of t hei r

own l awyer s. See Al yeska Pi pel i ne Ser v. Co. v. Wi l der ness Soc' y,

421 U. S. 240, 247 ( 1975) . Fee- shi f t i ng st at ut es depar t f r om t hi s

nor m and, t hus, must be st r i ct l y const r ued. See MR Cr escent Ci t y,

LLC v. Dr aper ( I n r e Cr escent Ci t y Est at es, LLC) , 588 F. 3d 822, 826

( 4t h Ci r . 2009) . The pl ai nt i f f s' pr oposed i nt er pr et at i on of 29

U. S. C. 1132( g) ( 1) cont r avenes t hese t enet s. As such, Ross' s

par t i ci pat i on i n an unr el at ed 401( k) pl an i s mani f est l y

i nsuf f i ci ent t o gr ound an awar d of f ees i n t hi s case.

As a f al l back, t he pl ai nt i f f s ur ge us t o af f i r mt he f ul l

f ee awar d under t he Fees Act , 42 U. S. C. 1988. Thi s st at ut e

aut hor i zes a cour t t o awar d at t or neys' f ees t o " t he pr evai l i ng

par t y" i n an act i on t o enf or ce a di scret e set of ci vi l r i ght s

st at ut es. Al t hough ERI SA i s not one of t hose ci vi l r i ght s

st at ut es, t he pl ai nt i f f s say t hat t he i ssue of ERI SA pr eempt i on i s

bound up wi t h t hei r vi ct or y regar di ng t he Or di nance' s r esi dency

r equi r ement and t he f ees r el at ed t o pr eempt i on of t he appr ent i ce

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t r ai ni ng r equi r ement shoul d f ol l ow sui t . Cf . Wagenmann v. Adams,

829 F. 2d 196, 225 ( 1st Ci r . 1987) ( hol di ng t hat "an awar d of f ees

f or t i me spent on al l aspect s" of t he case was proper under sect i on

1988 wher e t he non- ci vi l r i ght s cl ai ms " wer e suf f i ci ent l y

i nt er connected wi t h t he [ ci vi l r i ght s] cl ai ms") .

The di st r i ct cour t expl i ci t l y decl i ned t o consi der t hi s

ar gument because i t pr emi sed i t s f ee awar d i n si gni f i cant par t on

t he ERI SA f ee- shi f t i ng pr ovi si on. See Mer i t I I I , 2013 WL 3984596,

at *2. Si nce t he cour t awar ded t he f ul l amount t hat t he pl ai nt i f f s

r equest ed, i t di d not need t o ( and di d not ) ar t i cul at e what por t i on

of t he awar d was at t r i but abl e t o t hat pr ovi si on and what por t i on

was at t r i but abl e t o sect i on 1988. See i d. at *2- 3.

We ar e cogni zant t hat t he t r i al j udge' s " i nt i mat e

knowl edge of t he nuances of t he under l yi ng case uni quel y posi t i ons

[ her ] t o const r uct a condi gn awar d. " Gay Of f i cer s Act i on League v.

Puer t o Ri co, 247 F. 3d 288, 292 ( 1st Ci r . 2001) . Wi t h t hi s

pr udent i al pr i nci pl e i n mi nd, we t hi nk i t appr opr i at e her e t o al l ow

t he di st r i ct cour t t o consi der , i n t he f i r st i nst ance, whet her any

f ees beyond t he $20, 725 conceded by t he Ci t y ar e awardabl e under 42

U. S. C. 1988( b) and, i f so, i n what amount . Accor di ngl y, we set

asi de t he f ee awar d and r emand t o t he di st r i ct cour t f or f ur t her

consi der at i on.

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III. CONCLUSION

We need go no f ur t her . For t he r easons el uci dated above,

we af f i r m t he di st r i ct cour t ' s gr ant of summar y j udgment , but

r ever se the f ee awar d and r emand t o t he di st r i ct cour t f or f ur t her

pr oceedi ngs consi st ent wi t h t hi s opi ni on.

Affirmed in part, reversed in part, and remanded. No costs.

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merit construction alliance v. quincy, ma, 1st cir. (2014)

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