ASSOCIATED BUILDERS AND CONTRACTORS, INC., NEW JERSEY CHAPTER et al v. CITY OF JERSEY CITY, NEW JERSEY

Filing 71

OPINION. Signed by Judge Susan D. Wigenton on 6/15/2017. (JB, )

NOT FOR PUBLICATION

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

ASSOCIATED BUILDERS AND
CONTRACTORS, INC., NEW JERSEY
CHAPTER, et al.,

Civil Action No: 14-5445 (SDW) (SCM)

Plaintiffs,
v.

OPINION

CITY OF JERSEY CITY, NEW JERSEY,
Defendant,

June 15, 2017

and
HUDSON COUNTY BUILDING AND
CONSTRUCTION TRADES COUNCIL
Intervenor – Defendant.

WIGENTON, District Judge.
Before this Court is Plaintiffs Associated Builders and Contractors, New Jersey Chapter
(“ABC-NJ”), GMP Contractors (“GMP”), Alpine Painting and Sandblasting (“Alpine”), Alper
Enterprises, Inc. (“Alper”), and Ron Vasilik’s (“Vasilik”) (collectively, “Plaintiffs”) Motion for
Judgment on the Pleadings pursuant to Federal Rule of Civil Procedure 12(c). Jurisdiction is
proper pursuant to 28 U.S.C. §§ 1331. Venue is proper pursuant to 28 U.S.C. § 1391. This opinion
is issued without oral argument pursuant to Federal Rule of Civil Procedure 78. For the reasons
stated herein, the Motion for Judgment on the Pleadings is GRANTED.

I.

BACKGROUND AND PROCEDURAL HISTORY
This Court assumes the parties’ familiarity with the factual background and procedural

history in this matter and thus will only summarize that which is relevant to the instant motion.
On August 3, 2015, this Court dismissed Plaintiffs’ Complaint, which alleges that a City Ordinance
(the “PLA Ordinance”) imposing certain restrictions on contractors who receive tax abatements
on qualifying redevelopment projects is preempted by federal law.

Specifically, the PLA

Ordinance requires all contractors to enter into a “Project Labor Agreement” (“PLA”), which is
defined as “a contract between a labor organization and a developer” that contains various
requirements. 1 (Compl. ¶ 10.)
This Court concluded that the PLA Ordinance was not preempted because Defendant
Jersey City (“Jersey City”) acted as a market participant while enforcing it, and therefore
preemption analysis did not apply. In December 2015, Plaintiffs appealed this decision. See
Associated Builders & Contractors Inc. New Jersey Chapter v. City of Jersey City, New Jersey,
836 F.3d 412, 416 (3d Cir. 2016). The sole question the Third Circuit addressed was whether
Jersey City was properly deemed as a market participant or a regulator in its enforcement of the

1

The PLA Ordinance identifies several provisions that must be included in any negotiated
PLA before a project is approved for tax abatement, including: 1) guaranteeing the absence of
“strikes, lockouts, or other similar actions”; 2) establishing procedures to resolve labor disputes
that arise before the project’s completion; and 3) binding all contractors and subcontractors on the
project to the PLA. (Compl., Ex. A, § 304-35.) To provide training for Jersey City construction
apprentices, the PLAs also require a federally registered apprenticeship program through which
Jersey City apprentices would perform “twenty percent [] of the labor hours required” for the
project unless there are not enough Jersey City apprentices available (“Apprenticeship Program”).
(Id.)
2

PLA Ordinance. Id. at 416. On June 8, 2016, the Third Circuit concluded that Jersey City was
acting as a regulator and remanded the case back to this Court for further proceedings. 2 Id. at 421.
On February 17, 2017 Plaintiffs filed the instant motion for judgment on the pleadings
pursuant to Federal Rule of Civil Procedure 12(c). They ask this Court to enjoin Jersey City from
enforcing the PLA Ordinance on any tax-abated project because, they argue, it is preempted under
the National Labor Relations Act (“NLRA”) and the Employee Retirement Income Security Act
(“ERISA”), as well as unconstitutional on its face under the dormant Commerce Clause. (Pls.’ Br.
at 2.) Jersey City and Intervener – Defendant Hudson County Building and Construction Trades
Council (“Hudson County”) (collectively “Defendants”) filed their Opposition Briefs on April 3,
2017. Plaintiffs submitted a Reply Brief on April 21, 2017.
II.

LEGAL STANDARD
When examining a motion for judgment on the pleadings under Fed. R. Civ. P. 12(c), the

court examines the pleadings in the same manner as it would a Rule 12(b)(6) motion to dismiss.
Rosenau v. Unifund Corp., 539 F.3d 218, 221 (3d Cir. 2008). The court must “view the facts
presented in the pleadings and the inferences to be drawn therefrom in the light most favorable to
the nonmoving party.” Id. Judgment may only be granted if “the movant clearly establishes that
no material issue of fact remains to be resolved and that he is entitled to judgment as a matter of
law.” Id. The court may rely only on the pleadings and documents integral to or relied on by the
complaint. Mele v. Federal Reserve Bank of N.Y., 359 F.3d 251, 256 n. 5 (3d Cir. 2004).

2

Although this Court dismissed the Complaint in its entirety, Plaintiffs appealed that ruling
only as to Counts One, Two, and Three of the Complaint. See Associated Builders, 836 F.3d at
416. Therefore, only those Counts remain in this action.
3

III.

DISCUSSION
Plaintiffs’ Complaint alleges that the PLA Ordinance is preempted by § 7 or § 8 of the

NLRA. (Compl. ¶¶ 29-33.) Given the Third Circuit’s conclusion that Jersey City acted as a
regulator, the PLA Ordinance is subject to review under labor law preemption standards. See Hotel
Employees & Rest. Employees Union, Local 57 v. Sage Hosp. Res., LLC, 390 F.3d 206, 216 (3d
Cir. 2004) (“If a condition of procurement…reflects the government's action as a market
participant [it] escapes preemption review. But if the funding condition does not serve, or sweeps
more broadly than, a government agency's proprietary economic interest, it must submit to review
under labor law preemption standards.”)
Although the NLRA contains no express preemption provision, a state or local rule is
preempted by implication if it conflicts with federal law or would frustrate the federal scheme, or
if the court discerns “from the totality of the circumstances that Congress sought to occupy the
field to the exclusion of the States.” Id. at 211 (3d Cir. 2004) (quoting Allis-Chalmers Corp. v.
Lueck, 471 U.S. 202, 209 (1985)). The Supreme Court has outlined two implied-preemption
doctrines around the NLRA. Id. at 211. First, preemption applies where there is state or local
regulation of activities that are “protected by § 7 of the [NLRA], or where the regulation constitutes
an unfair labor practice under § 8.” San Diego Bldg. Trades Council, Millmen’s Union, Local
2020 v. Garmon, 359 U.S. 236, 244 (1959). Second, preemption applies where there is state and
local regulation of activities that are meant “to be controlled by the free play of economic forces.”
Lodge 76, Int’l Ass’n of Machinists & Aerospace Workers, AFL-CIO v. Wisconsin Employment
Relations Comm'n, 427 U.S. 132, 140 (1976) (internal quotation marks omitted).

4

This Court finds that the PLA Ordinance falls squarely within the scope of the two NLRA
preemption doctrines outlined by the Supreme Court in Garmon and Machinists. 3 Mandating that
tax abatement recipients enter into a PLA with certain required terms, such as a no strikes or
lockouts provision, directly intrudes on § 7 and § 8 of the NLRA. These sections of the NLRA
“safeguard an employee's right to join, or refrain from joining, a labor union” and preempt “state
and local laws that strip employers or employees of certain ‘self-help’ economic tools like strikes
and lockouts.” See Associated Builders, 836 F.3d at 417; Sage, 390 F.3d at 212 (“Garmon
preemption prohibits regulation even of activities that the NLRA protects, prohibits, or arguably
protects or prohibits.”) (internal marks omitted); see also Machinists, 427 U.S. at 149 (“[N]either
States nor the [National Labor Relations Board] is afforded flexibility in picking and choosing
which economic devices of labor and management shall be branded as unlawful.”) (internal
quotation marks omitted). Because this Court finds that the PLA Ordinance is preempted by the
NLRA, it is void ab initio. 4 See Sage, 390 F.3d at 211.

3

This Court also notes that ERISA “supersede[s] any and all State laws insofar as they may
now or hereafter relate to any employee benefit plan,” which includes “apprenticeship or other
training programs.” 29 U.S.C. § 1002(1), § 1144. The PLA Ordinance, which outlines the
operation and reporting requirements of the Apprenticeship Program (see supra note 1), is
therefore preempted by ERISA as well.
4
In its opposition to the instant motion, Jersey City contends that Plaintiffs are not entitled
to judgment on the pleadings because there are material facts in dispute which require discovery.
(Def.’s Br. at 9.) However, Jersey City enumerates only legal disputes to support this contention.
(Id. at 9 – 10) (“For instance, there is a dispute as to whether the PLA Ordinance is preempted by
ERISA and if Plaintiffs have standing to challenge the PLA Ordinance under the Dormant
Commerce Clause. Moreover, Plaintiffs inaccurately argue that the Third Circuit determined that
the City acts as a regulator in enacting and enforcing the PLA Ordinance under any and all
circumstances.”) These are not material issues of fact, but rather legal questions that can be
resolved without discovery.
5

IV.

CONCLUSION
For the reasons set forth above, Plaintiff’s Motion for Judgment on the Pleadings is

GRANTED and enforcement of the PLA Ordinance on any tax-abated project is enjoined. An
appropriate order follows.
___/s/ Susan D. Wigenton_____
SUSAN D. WIGENTON, U.S.D.J.

Orig:
cc:

Clerk
Steven C. Mannion, U.S.M.J.
Parties

6