1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 EUROPA AUTO IMPORTS, INC. d/b/a Case No.: 22cv1987GPC(BGS)

MERCEDES-BENZ OF SAN DIEGO,

12

ORDER GRANTING IN PART AND

Plaintiff, 13 DENYING IN PART DEFENDANT’S v. MOTION TO DISMISS FOR LACK 14

OF SUBJECT MATTER

INTERNATIONAL ASSOCIATION OF

15 JURISDICTION AND GRANTING

MACHINISTS AND AEROSAPCE

DEFENDANT’S MOTION TO

16 WORKERS LOCAL LODGE NO. 1484,

DISMISS FOR FAILURE TO STATE

MACHINISTS AUTOMOTIVE

17 A CLAIM WITH LEAVE TO TRADES DISTRICT LODGE 190 and

AMEND

18 DOES 1 through 50, inclusive, [Dkt. No. 4.] 19 Defendants. 20 21 Before the Court is Defendant’s motion to dismiss the complaint pursuant to 22 Federal Rule of Civil Procedure 12(b)(1) and 12(b)(6). (Dkt. No. 4.) Plaintiff filed a 23 response on June 2, 2023. (Dkt. No. 7.) A reply was filed by Defendant on June 9, 2023. 24 (Dkt. No. 10.) The Court finds that the matter is appropriate for decision without oral 25 argument pursuant to Local Civ. R. 7.1(d)(1). Based on the reasoning below, the Court 26 GRANTS in part and DENIES in part Defendant’s motion to dismiss for lack of subject 27 28 1 matter jurisdiction and GRANTS Defendant’s motion to dismiss for failure to state a 2 claim with leave to amend.1 3 Background 4 On December 15, 2022, Plaintiff Europa Auto Imports, Inc. d/b/a Mercedes-Benz 5 of San Diego (“Plaintiff” or “Europa”) filed a complaint against Defendant International 6 Association of Machinists and Aerospace Workers Local Lodge No. 1484, Machinists 7 Automotive Trades District Lodge 190 (“Defendant” or “Union”) for 1) breach of the 8 collective bargaining agreement, 2) tortious interference with prospective economic 9 advantage and contractual business relations, 3) trespass to chattel, 4) trespass to real 10 property, 5) defamation and 6) unfair competition under California Business & 11 Professions Code section 17200 et seq. (Dkt. No. 1, Compl.) 12 Europa and the Union entered into a written collective bargaining agreement 13 (“CBA”) effective May 1, 2019 until April 30, 2022. (Id. ¶ 13.) The complaint alleges 14 that Section 33 of the CBA provided that if the parties were still meeting and negotiating 15 for a new contract, the provisions of the CBA, including the prohibitions on strikes, 16 slowdowns and cessation of work, continued after April 30, 2022 and remained binding 17 upon the parties. (Id. ¶¶ 13, 14.) Further, Section 7 of the CBA required the parties to 18 resolve any disputes through the grievance and arbitration procedures. (Id. ¶ 15.) 19 The complaint also alleges from April 2022 through June 2022, Defendant 20 planned, organized, and directed an illegal work slowdown among the bargaining unit 21 employees covered by the contract. (Id. ¶ 17.) Around June 16, 2022, Defendant 22 planned, organized, and directed an unlawful strike in violation of the CBA which began 23 on June 17, 2022 despite the fact that negotiations and bargaining sessions were already 24

25 26 1 Defendant filed a request for judicial notice of the unfair labor practice charges filed by Plaintiff, the decision to dismiss the charges by the Regional Director of Region 21 of the National Labor Relations 27 Board (“NLRB”) and denial of the appeals with the NLRB General Counsel Office’s Office of Appeals (“GC”). (Dkt. No. 4-4.) Because the Court did not rely on these documents in its ruling, the Court 28 1 scheduled in July 2022. (Id. ¶ 18.) The unlawful strike continued until the date of the 2 filing of the complaint. (Id.) 3 Prior to the termination of the CBA and through July 2022, Plaintiff and Defendant 4 held bargaining sessions to amend the CBA. (Id. ¶ 16.) But, starting in May 2022 5 through September 2022, agents of Defendant engaged in conduct that violated the CBA. 6 (Id. ¶ 11.) They intentionally trespassed upon Europa’s property to intentionally interfere 7 with its business operations and with its contractual relations with third parties. (Id.) For 8 instance, Defendant’s agents blocked egress and ingress to Europa’s property, intimidated 9 and harassed employees to prevent them from going to work, and stopped customers 10 from doing business with Europa. (Id.) Agents of Defendant also unlawfully entered or 11 trespassed into the internal areas of Europa’s physical facility and physically 12 commandeered the shop to interrupt and interfere with business operations. (Id.) 13 In addition, an agent of Defendant and a picketer holding a Union picket sign hit a 14 customer’s car driven by an employee that was entering Europa’s property. (Id.) They 15 stopped the vehicle from entering the driveway of the facility while Robert Moreno, one 16 of the fellow picketers, repeatedly struck the hood and windshield of the vehicle to 17 intimidate and place fear into a non-bargaining unit employee as well as other employees. 18 (Id.) The attack caused significant damage to the customer’s hood and windshield 19 causing in excess of $3,000.00 of damages. (Id.) According to the complaint, 20 Defendant’s conduct violated federal and state law and the terms of the CBA. (Id.) 21 Plaintiff alleges it filed a grievance and/or made a demand for arbitration regarding 22 the dispute between the parties on May 24, and May 31, 2022. (Id.) It further contends 23 that Defendant filed its own grievance on July 20, 2022 but has failed to proceed through 24 its own filed grievance. (Id.) Defendant’s violations of the CBA have disrupted 25 Europa’s business of providing retail sales and service to high-end consumer and 26 commercial vehicles and it has suffered irreparable loss and damages. (Id. ¶¶ 22, 23.) 27 Due to the strike, Plaintiff has secured permanent, temporary, stopgap and conditional 28 1 labor to maintain its operations during the strike which resulted in further damages to 2 Plaintiff. (Id. ¶ 24.) 3 Defendant filed a motion to dismiss for lack of subject matter jurisdiction and 4 failure to state a claim which is fully briefed. (Dkt. Nos. 4, 7, 10.) 5 Discussion 6 A. Legal Standard on Federal Rule of Civil Procedure 12(b)(1) 7 Federal Rule of Civil Procedure (“Rule”) 12(b)(1) provides for dismissal of a 8 complaint for lack of subject-matter jurisdiction. Fed. R. Civ. P. 12(b)(1). Rule 12(b)(1) 9 jurisdictional attacks can be either facial or factual. White v. Lee, 227 F.3d 1214, 1242 10 (9th Cir. 2000). Here, while not articulated by Defendant, it appears to be mounting a 11 factual attack on subject matter jurisdiction because Defendant relies on evidence outside 12 the complaint. 13 In a factual attack, the challenger provides evidence that an alleged fact in the 14 complaint is false, thereby resulting in a lack of subject matter jurisdiction. Safe Air for 15 Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). Under a factual attack, the 16 allegations in the complaint are not presumed to be true, White, 227 F.3d at 1242, and 17 “the district court is not restricted to the face of the pleadings, but may review any 18 evidence, such as affidavits and testimony, to resolve factual disputes concerning the 19 existence of jurisdiction.” McCarthy v. United States, 850 F.2d 558, 560 (9th Cir. 1988). 20 “Once the moving party has converted the motion to dismiss into a factual motion by 21 presenting affidavits or other evidence properly brought before the court, the party 22 opposing the motion must furnish affidavits or other evidence necessary to satisfy its 23 burden of establishing subject matter jurisdiction.” Savage v. Glendale Union H.S., Dist. 24 No. 205, Maricopa Cnty., 343 F.3d 1036, 1039 n. 2 (9th Cir. 2003). The district court 25 may review evidence beyond the complaint without converting the motion to dismiss into 26 a motion for summary judgment. See id. However, “[a] court may not resolve genuinely 27 disputed facts where ‘the question of jurisdiction is dependent on the resolution of factual 28 issues going to the merits.’” Roberts v. Corrothers, 812 F.2d 1173, 1177 (9th Cir. 1987) 1 (citations omitted). Ultimately, Plaintiff has the burden to demonstrate that subject 2 matter jurisdiction exists. Kokkonen v. Guardian Life Ins. Co. of America, 511 U.S. 375, 3 377 (1994). 4 B. Legal Standard on Federal Rule of Civil Procedure 12(b)(6) 5 Federal Rule of Civil Procedure 12(b)(6) permits dismissal for “failure to state a 6 claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). Dismissal under Rule 7 12(b)(6) is appropriate where the complaint lacks a cognizable legal theory or sufficient 8 facts to support a cognizable legal theory. See Balistreri v. Pacifica Police Dep’t., 901 9 F.2d 696, 699 (9th Cir. 1990). Under Federal Rule of Civil Procedure 8(a)(2), the 10 plaintiff is required only to set forth a “short and plain statement of the claim showing 11 that the pleader is entitled to relief,” and “give the defendant fair notice of what the . . . 12 claim is and the grounds upon which it rests.” Bell Atlantic Corp. v. Twombly, 550 U.S. 13 544, 555 (2007). 14 A complaint may survive a motion to dismiss only if, taking all well-pleaded 15 factual allegations as true, it contains enough facts to “state a claim to relief that is 16 plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 17 550 U.S. at 570). “A claim has facial plausibility when the plaintiff pleads factual 18 content that allows the court to draw the reasonable inference that the defendant is liable 19 for the misconduct alleged.” Id. “Threadbare recitals of the elements of a cause of 20 action, supported by mere conclusory statements, do not suffice.” Id. “In sum, for a 21 complaint to survive a motion to dismiss, the non-conclusory factual content, and 22 reasonable inferences from that content, must be plausibly suggestive of a claim entitling 23 the plaintiff to relief.” Moss v. United States Secret Serv., 572 F.3d 962, 969 (9th Cir. 24 2009) (quotations omitted). In reviewing a Rule 12(b)(6) motion, the Court accepts as 25 true all facts alleged in the complaint, and draws all reasonable inferences in favor of the 26 plaintiff. al-Kidd v. Ashcroft, 580 F.3d 949, 956 (9th Cir. 2009). 27 Where a motion to dismiss is granted, “leave to amend should be granted ‘unless 28 the court determines that the allegation of other facts consistent with the challenged 1 pleading could not possibly cure the deficiency.’” DeSoto v. Yellow Freight Sys., Inc., 2 957 F.2d 655, 658 (9th Cir. 1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture 3 Co., 806 F.2d 1393, 1401 (9th Cir. 1986)). In other words, where leave to amend would 4 be futile, the Court may deny leave to amend. See DeSoto, 957 F.2d at 658; Schreiber, 5 806 F.2d at 1401. 6 C. First Cause of Action – Breach of Contract under Section 301(a) of the LMRA 7 The complaint alleges that federal subject matter jurisdiction exists under Section 8 301(a) of the Labor Management Relations Act (“LMRA”), 29 U.S.C. § 185(a). (Dkt. 9 No. 1, Compl. ¶ 2.) 10 Section 301(a)2 of the LMRA confers the Court with subject matter jurisdiction 11 over “[s]uits for violation of contracts.” Textron Lycoming Reciprocating Engine Div., 12 Avco Corp. v. United Auto., Aerospace, Agric. Implement Workers of America, Int’l. 13 Union, 523 U.S. 653, 656 (1998). “Section 301(a) is a basis for jurisdiction when the suit 14 is based on a colorable claim of breach of contract between an employer and a labor 15 organization in an industry affecting commerce and the resolution of the lawsuit is 16 focused upon and governed by the terms of the contract.” Painting & Decorating 17 Contractors Ass'n of Sacramento, Inc. v. Painters & Decorators Joint Comm. of E. Bay 18 Cntys., Inc., 707 F.2d 1067, 1071 (9th Cir. 1983). 19 Moreover, “[a]n expired CBA itself is no longer a ‘legally enforceable document.’” 20 Off. & Pro. Employees Ins. Trust Fund v. Laborers Funds Admin. Off. of N. Cal., Inc., 21 783 F.2d 919, 922 (9th Cir. 1986) (quoting Cement Masons Health and Welfare Trust 22 Fund For N, Cal. v. Kirkwood-Bly, Inc., 520 F. Supp. 942, 944-45 (N.D. Cal. 1981), 23 aff'd, 692 F.2d 641, (9th Cir. 1982)); Lumber Prod. Indus. Workers Loc. No. 1054 v. W. 24

25 26 2 “Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, 27 may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.” 29 U.S.C. § 28 1 Coast Indus. Relations Ass'n, Inc., 775 F.2d 1042, 1046 (9th Cir. 1985) (“It logically 2 follows that an expired [collective bargaining] agreement cannot serve as the basis for a 3 proper exercise of jurisdiction under section 301(a)”); Cement Masons Health and 4 Welfare Trust Fund v. Kirkwood–Bly, Inc., 520 F. Supp. 942, 946 (N.D. Cal. 1981) 5 (“Plaintiffs cite no case, nor can we find any, which ha[s] permitted district courts to 6 enforce properly expired collective bargaining agreements in a section 301 action”), aff'd, 7 692 F.2d 641 (9th Cir. 1982). As a general rule, where the bargaining contract at issue 8 has expired, the parties are “released . . . from their respective contractual obligations” 9 and any dispute between them cannot be said to arise under the contract. Litton Fin. 10 Printing Div. v. N.L.R.B., 501 U.S. 190, 206 (1991). 11 Here, the parties entered into a CBA effective May 1, 2019 through April 30, 2022. 12 (Dkt. No. 4-2, Kucera Decl., Ex. A, CBA § 33.01.) The relevant provisions of Section 33 13 of the CBA provide: 14 33.01 . . . From and after April 30, 2022, this Agreement shall continue for yearly terms commencing with said date unless either of the parties give 15 written notice to the other no later than sixty (60) calendar days and no 16 earlier than ninety (90) calendar days immediately prior to said date and each May 1st thereafter, expressing the desire of said party to terminate or 17 revise and amend said Agreement. 18 33.02 In the event of a notice desiring to revise and amend said Agreement, 19 said notice shall not serve to terminate this Agreement, but merely to 20 provide the necessary procedure for the revision of the Agreement to conform to changed conditions; it being the intent and agreement of the 21 parties that upon the expiration of any yearly term, the following yearly term 22 shall automatically take effect, irrespective of whether or not notice of revision is given; if no notice of desire to amend is given, the provisions of 23 the Agreement for the new term shall be the same as the preceding term. 24 33.03 If notice of desire to amend is given, the changes arrived at by reason 25 of said notice shall become effective upon the date agreed to by the parties. 26 Pending the resolving of the desired changes under consideration, the provisions of the expiring term shall continue in effect as the operative 27 Agreement of the parties. There shall be no cessation of work or lockout 28 during such conferences. 1 2 (Id. §§ 33.01, 33.02, 33.03 (emphasis added).) The CBA also provides: 3 SECTION 32. NO STRIKE, NO LOCKOUT

4 32.01 During the term of this Agreement, the union agrees that it will not 5 authorize, cause, induce, support or condone any strike, picketing, sympathy strike, work stoppage, slowdown of work or walk out by any employee 6 covered by this Agreement; however, it shall not be a violation of this 7 Agreement for any person covered by this Agreement to refuse to cross any lawful primary picket line. 8 32.02 No employee shall be permanently replaced because of his honoring 9 such lawful primary picket line, providing he is available for work immediately following withdrawal of the primary picket line. 10 32.03 The employer agrees that there will be no lockouts during the term of 11 this Agreement.

12 (Id. §§ 32.01, 32.02.) 13 1. Union Conduct After April 30, 2022 14 In its motion, the Union argues that the Court lacks subject matter jurisdiction over 15 the Section 301 claim because the CBA terminated on April 30, 2022 and it had the right 16 to strike on May 1, 2022 because it sent a notice of termination per Section 33.01 around 17 February 1, 2022. (Dkt. No. 4-1 at 14-16.3) In opposition, Plaintiff does not factually 18 dispute that the Union sent it a written notice of termination nor its interpretation of the 19 CBA that a notice of termination ended the agreement and did not extend the terms of the 20 CBA. (See Dkt. No. 7.) Instead, Plaintiff procedurally challenges the Union’s reliance 21 on extrinsic evidence of the Union’s notice of termination on a motion to dismiss. (Id. at 22 10-11; 18-19.) 23 However, a district court may properly consider extrinsic evidence on a “factual” 24 motion to dismiss under Rule 12(b)(1), see Savage, 343 F.3d at 1039 n.2, but it may not 25 decide genuinely disputed facts where “the question of jurisdiction is dependent on the 26 27 28 1 resolution of factual issues going to the merits.” Roberts, 812 F.2d at 1177. Because 2 Defendant raises a factual attack on subject matter jurisdiction and Plaintiff does not 3 dispute the existence and effect of the written notice of termination, the Court may 4 consider it. 5 Around February 1, 2022, the Union sent Plaintiff a letter notifying that it desired 6 “to terminate our Agreement, which expires April 30, 2022, and negotiate a new 7 Agreement covering wages, hours and other working conditions.” (Dkt. No. 4-2, Kucera 8 Decl. ¶¶ 4, 5.4) Per the terms of Section 33.01, the terms of the CBA did not survive the 9 expiration of the CBA on April 30, 2022. Thus, Plaintiff has failed to make a showing 10 that any of the challenged conduct after April 30, 2022 arise under the CBA and has not 11 asserted a basis for the Court’s jurisdiction under Section 301(a). As such, the Court 12 GRANTS Defendant’s motion to dismiss any conduct allegedly violative of the CBA that 13 occurred after April 30, 2022 for lack of subject matter jurisdiction. 14 Plaintiff also argues that irrespective of the CBA, an unlawful slowdown is in 15 violation of federal law citing primarily to NLRB cases concerning unfair labor practices 16 rather than breach of a CBA. (Dkt. No. 7 at 14-15.) Those cases do not provide authority 17 for the Court’s jurisdiction over the Complaint’s allegations under Section 301. 18 Plaintiff next makes a claim that the CBA continued in full force under post- 19 termination status quo principles. (Dkt. No. 7 at 10). First, Plaintiff fails to point to a 20 provision in the CBA that would allow for the continuation of the terms of the CBA past 21 April 30, 2022. In the complaint, Plaintiff alleges that Section 33 of the CBA provides 22 that if the parties were still meeting and negotiating a new contract, the provisions of the 23 CBA continued after April 30, 2022 and remained binding upon the parties. (Dkt. No. 1, 24 Compl. ¶¶ 13, 14.) The complaint selectively quotes a portion of Section 33.03 which 25

26 4 Defendant clarifies that the date on the termination letter as well as the date written by the person who 27 signed the return receipt form were mistakenly written as February 1, 2021 instead of February 1, 2022. (Dkt. No. 4-2, Kucera Decl. ¶¶ 4, 5; Dkt. No. 4-2, Kucera Decl., Exs. B, C.) Plaintiff does not dispute 28 1 provides that “[p]ending the resolving of the desired changes under consideration” the 2 provisions of the expiring term shall continue in effect. There shall be no cessation of 3 work or lockout during such conferences.” (Id. ¶14.) However, under Section 33.03, this 4 continued CBA provision only applies if written “notice of desire to amend” is given by 5 either of the parties. The complaint does not allege that either party gave written notice 6 of a desire to amend the CBA. Plaintiff has not asserted sufficient facts to support the 7 claim that the CBA continued in effect past April 30, 2022. 8 Second, Plaintiff fails to provide any caselaw in support of the status quo 9 principles. Third, to the extent Plaintiff is arguing that the status quo principles are 10 guided by the National Labor Relations Act (“NLRA”), the Complaint does not allege, 11 nor is it clear that it can assert, the Court’s jurisdiction based on a statutory claim. See 12 Bud Antle, Inc. v. Barbosa, 45 F.3d 1261, 1268 (9th Cir. 1994) (“If the conduct arguably 13 falls within the scope of the Act, then the interest in a uniform federal labor policy 14 identified in Garmon5 requires both the states and the federal courts to defer to the 15 exclusive jurisdiction of the NLRB.”); cf. N.L.R.B. v. Nexstar Broadcasting, Inc., 4 F.4th 16 801, 806 (9th Cir. 2021) (as to an employer’s conduct, recognizing that after a CBA 17 expires, the “terms and conditions [of employment] continue in effect by operation of the 18 NLRA. They are no longer agreed-upon terms; they are terms imposed by law, at least so 19 far as there is no unilateral right to change them”). 20 2. Union Conduct Prior to April 30, 2022 21 As to conduct prior to the expiration of the CBA, Plaintiff asserts that the Union 22 materially breached the CBA in April 2022 by directing a work slowdown. (Dkt. No. 7 23 at 11-13.) The complaint alleges a breach of the CBA by the Union’s involvement in 24 directing a work slowdown among the bargaining unit employees in April 2022, prior to 25 its expiration. (See Dkt. No. 1, Compl. ¶ 17.) Europa provides the declaration of two of 26 27 28 1 its Union employees attesting that Kevin Kucera, the Union representative, implicitly 2 encouraged a work slowdown in mid-April 2022 and that Pedro Gomez, the Shop 3 Steward, also directed the employees to decrease productivity in early April 2022 to 4 support the Union’s bargaining demands. (Dkt. No. 7-3, Cikos Decl. ¶¶ 8-10; Dkt. No. 7- 5 4, Irwin Decl. ¶¶ 6-7.) Michael Ritchey, the General Manager of Europa, also declared 6 that from mid-April 2022 until the end of May 2022, the Union instructed bargaining unit 7 members to go to work, be paid but not to produce work at normal levels. (Dkt. No. 7-2, 8 Ritchey Decl. ¶ 6.) The work slowdown cost Europe hundreds of thousands of dollars in 9 lost income. (Id.) In reply, the Union does not dispute that the slowdown allegations fall 10 within the terms of the CBA. (See Dkt. No. 10.) Therefore, breach of the CBA based on 11 the work slowdown alleged in April 2022 falls within Section 301 and the Court DENIES 12 Defendant’s motion to dismiss for lack of subject matter jurisdiction any conduct 13 allegedly violative of the CBA that occurred in April 2022. 14 D. Exhaustion of the Grievance Procedures 15 Defendant additionally argues the slowdown allegations of April 2022 must be 16 dismissed because Europa failed to exhaust the grievance procedures of the CBA. (Dkt. 17 No. 10 at 4.) Plaintiff responds that it invoked the CBA’s grievance procedure as to the 18 illegal work slowdown. (Dkt. No. 7 at 16-17.) 19 While Defendant argues that a failure to exhaust affects the Court’s subject matter 20 jurisdiction, (Dkt. No. 4-1 at 17; Dkt. No. 10 at 4), the Ninth Circuit has held that a 21 failure to exhaust non-judicial remedies does not fall within a Rule 12(b)(1) motion. 22 Inlandboatmens Union of Pac. v. Dutra Grp., 279 F.3d 1075, 1078 n.2 (9th Cir. 2002) 23 (citing Ritza v. Int'l Longshoremen's and Warehousemen's Union, 837 F.2d 365, 368-69 24 (9th Cir. 1988) (per curiam), overruled on other grounds by Albino v. Baca, 747 F.3d 25 1162, 1166 (9th Cir. 2014)). In Albino, the Ninth Circuit held that a failure to exhaust 26 remedies must be raised as a Rule 12(b)(6) or Rule 56 motion and not as an 27 unenumerated Rule 12(b) motion. See Albino v. Baca, 747 F.3d 1162, 1166 (9th Cir. 28 2014). The Ninth Circuit offered two ways a party may raise a party’s failure to exhaust. 1 First, “where a failure to exhaust is clear from the face of the complaint, a defendant may 2 successfully move to dismiss under Rule 12(b)(6) for failure to state a claim.” Id. at 3 1169. “Otherwise, defendants must produce evidence proving failure to exhaust in order 4 to carry their burden. If undisputed evidence viewed in the light most favorable to the 5 prisoner shows a failure to exhaust, a defendant is entitled to summary judgment under 6 Rule 56. If material facts are disputed, summary judgment should be denied, and the 7 district judge rather than a jury should determine the facts.” Id. at 1166. 8 Here, neither party has produced evidence as it relates to exhaustion of the 9 grievance procedures; therefore, the Court looks at whether the complaint alleges 10 exhaustion of the CBA’s grievance procedures under a Rule 12(b)(6) standard. 11 “As a general rule in cases to which federal law applies, federal labor policy 12 requires . . . use of the contract grievance procedure agreed upon by employer and union 13 as the mode of redress.” Republic Steel Corp. v. Maddox, 379 U.S. 650, 652 (1965). In 14 passing Section 301, Congress’ intent was to encourage mutually agreed upon grievance 15 procedures between the parties in a collective bargaining agreement to “promote a higher 16 degree of responsibility upon the parties to such agreements . . . thereby promot[ing] 17 industrial peace.” Drake Bakeries, Inc. v. Local 50, Am. Bakery & Confectionery 18 Workers Int'l, AFL–CIO, 370 U.S. 254, 263 (1962) (quoting S. Rep. No. 105, 80th Cong., 19 1st Sess. 17). Neither party disputes that a party must exhaust the grievance procedures 20 agreed upon in the CBA prior to filing a complaint in this Court. 21 In this case, the grievance provision is broad and covers “any difference[s that] 22 arise concerning the provisions of this Agreement.” (Dkt. No. 4-1, Kucera Decl., Ex. A, 23 CBA § 7 at 10.) If the dispute “cannot satisfactorily be adjusted by the Business 24 Representative of the Union and the Employer, the written dispute shall be submitted in 25 writing . . . to an adjustment board . . . .” (Id.) “In the event of the failure of the 26 adjustment board to reach an agreement within fifteen (15) working days after 27 appointment, it shall lose jurisdiction and the matter may be referred to an impartial 28 arbitrator to be mutually selected by the Union and the Employer. In the event the 1 Employer and the Union are unable to agree upon the selection of the arbitrator within 2 ten (10) working days, the Federal Mediation and Conciliation Service shall be petitioned 3 to submit a panel of five (5) arbitrators. Each of the parties shall delete the names of two 4 (2) of the panel members and the remaining arbitrator shall decide the issue.” (Id. at 11.) 5 Here, the complaint summarily alleges that Plaintiff filed a “grievance with 6 Defendant and/or made a demand for arbitration concerning any such dispute between the 7 parties on May 24 and May 31, 2022.” (Dkt. No. 1, Compl. ¶ 19; see id. Compl. ¶ 28 8 (“Plaintiff exhausted all procedures available to it prior to resorting to this complaint 9 seeking monetary and injunctive relief.”).) However, the complaint fails to allege 10 whether the April 2022 slowdown was subject to the grievance submitted by Plaintiff on 11 May 24 and May 31, 2022 and fails to allege that it complied with the grievance 12 procedure as provided in the CBA. See e.g., Woodford v. Ngo, 548 U.S. 81, 90 (2006) 13 (“[p]roper exhaustion demands compliance with an agency's deadlines and other critical 14 procedural rules[.]”). 15 Accordingly, the Court GRANTS Defendant’s motion to dismiss for failure to 16 allege proper exhaustion regarding the work slowdown allegations. 17 E. Remaining State Law Claims 18 The second through sixth causes of action allege state law claims for 1) tortious 19 interference with prospective economic advantage and contractual business relations, 2) 20 trespass to chattel, 3) trespass to real property, 4) defamation, and 5) unfair business 21 practices. (Dkt. No. 1, Compl. at p. 7-12.) All these causes of action appear to arise from 22 the strike that began on June 16, 2022. (Dkt. No. 1, Compl. ¶¶ 27, 27(f), 32, 35, 38 23 (“[d]uring the picketing”, “[a]s part of its strike”, “[d]uring and throughout the course of 24 the strike”, “unlawfully . . . entered into non-public areas of Plaintiff’s during work time . 25 . and intimate workers who were not striking”, “during the strike”.) 26 A district court that has original jurisdiction over a civil action “shall have 27 supplemental jurisdiction over all other claims that are so related to claims in the action 28 within such original jurisdiction that they form part of the same case or controversy under 1 Article III of the United States Constitution.” 28 U.S.C. § 1367(a). Because the Court is 2 without original federal question jurisdiction over any conduct after April 30, 2022, the 3 Court lacks supplemental jurisdiction over the state law claims which are based a strike 4 that began on June 16, 2022. See id.; see also 28 U.S.C. § 1367(c)(3) (district court may 5 decline to exercise supplemental jurisdiction . . . if . . . (3) the district court has dismissed 6 all claims over which it has original jurisdiction”). 7 Accordingly, because the Court lacks supplemental jurisdiction over the state law 8 claims for lack of subject matter jurisdiction and for failing to allege exhaustion, it sua 9 sponte GRANTS dismissal of them.6 See Acri v. Varian Assocs., Inc., 114 F.3d 999, 10 1001 n.3 (9th Cir. 1997) (en banc) (district courts may decline sua sponte to exercise 11 supplemental jurisdiction). 12 However, to the extent the UCL claim can be liberally inferred to be based on 13 conduct prior to April 30, 2022, it also fails to state a claim. The complaint simply 14 alleges a UCL violation based on the actions of Defendant which caused Plaintiff to 15 suffer an “injury in fact.” (Dkt. No. 1, Compl. ¶¶ 42-47.) Plaintiff does not allege any 16 specific conduct or any specific time period and merely refers to the “above-described 17 unlawful actions.” (Id.) 18 The UCL prohibits “any unlawful, unfair or fraudulent business act or practice and 19 unfair, deceptive, untrue or misleading advertising . . . .” Hinojos v. Kohl's Corp., 718 20 F.3d 1098, 1103 (9th Cir. 2013), as amended on denial of reh'g and reh'g en banc (July 21 8, 2013). “The UCL operates as a three-pronged statute: ‘Each of these three adjectives 22 [unlawful, unfair, or fraudulent] captures a ‘separate and distinct theory of liability.’” 23 Beaver v. Tarsadia Hotels, 816 F.3d 1170, 1177 (9th Cir 2016) (quoting Rubio v. Capital 24 25

26 6 Because the Court lacks supplemental jurisdiction over the state law claims, the Court need not address 27 Defendant’s arguments to dismiss the state law claims based on the Norris-Laguardia Act and Garmon preemption, see San Diego Bldg. Trades Council, Millmen’s Union, Loc. 2020 v. Garmon, 359 U.S. 236 28 1 One Bank, 613 F.3d 1195, 1203 (9th Cir. 2010)). Plaintiff appears to be alleging a claim 2 under the “unlawful” prong of the UCL. 3 Under the “unlawful” prong, “[t]he UCL ‘borrows violations of other laws and 4 treats them as unlawful practices that the unfair competition law makes independently 5 actionable.’” Wilson v. Hewlett–Packard Co., 668 F.3d 1136, 1140 (9th Cir. 2012) 6 (quoting Cel-Tech Commc'ns, Inc. v. L.A. Cellular Tel. Co., 20 Cal. 4th 163, 180, 7 (1999)). However, Plaintiff has not alleged the “other laws” that will serve as a predicate 8 to this cause of action. To the extent Plaintiff alleges that a breach of contract constitutes 9 the “other law”, it is without merit. See Shroyer v. New Cingular Wireless Servs., Inc., 10 622 F.3d 1035, 1044 (9th Cir. 2010) (“a common law violation such as a breach of 11 contract is insufficient . . . under the unlawful prong of § 17200”); Meyer v. Aabaco 12 Small Bus., LLC, No. 17-cv-02102-EJD, 2018 WL 306688, at *4 (N.D. Cal. Jan. 5, 2018) 13 (following Shroyer and dismissing UCL “unlawful” claim predicated on common-law 14 breach-of-contract claim). 15 Moreover, to the extent Plaintiff is seeking injunctive relief under the UCL, (Dkt. 16 No. 1, Compl at p. 12), it must plausibly allege “an inadequate remedy at law.” See Fiero 17 v. Fierro v. Capital One, N.A., -- F. Supp. 3d --, 2023 WL 1999482, at *6 (S.D. Cal. Feb. 18 14, 2023) (citing Shay v. Apple, No. 20-cv-1629-GPC(BLM), 2021 WL 1733385, at *2–5 19 (S.D. Cal. May 3, 2021)). The complaint fails to allege an inadequate remedy at law. 20 Accordingly, to the extent Plaintiff alleges a UCL claim based on conduct prior to 21 April 30, 2022, it fails to state a claim. 22 F. Leave to Amend 23 In the event the Court grants dismissal of any claim under Rule 12(b)(6), Plaintiff 24 demands that leave of Court be granted to file an amended complaint to cure the 25 deficiencies. (Dkt. No. 7 at 33.) Because amending the complaint would not be futile as 26 to exhaustion, the Court GRANTS Plaintiff leave to file an amended complaint to 27 properly allege exhaustion concerning the work slowdown claim. See DeSoto, 957 F.2d 28 at 658; Schreiber, 806 F.2d at 1401. 1 Defendant’s Motion to Dismiss State Law Claims under the anti-SLAPP 2 Defendant also concurrently filed a motion to dismiss the state law claims under 3 || California Code of Civil Procedure section 425.16 (“anti-SLAPP” statute) which permits 4 special motions to strike strategic lawsuits against public participation for conduct 5 || relating to the protected activity of striking and picketing at Europa’s car dealership that 6 || began on June 17, 2022, which is fully briefed. (Dkt. Nos. 5, 8, 9.) Because the Court 7 GRANTS dismissal of the state law claims for lack of supplemental jurisdiction, it 8 || DENIES Defendant’s motion to strike the state law claims as MOOT. 9 Conclusion 10 Based on the above, the Court GRANTS in part and DENIES in part Defendant’s 11 motion to dismiss for lack of subject matter jurisdiction. Specifically, the Court 12 || GRANTS Defendant’s motion to dismiss the first cause of action based on any 13 || allegations of breaching conduct after April 30, 2022 but DENIES the motion to dismiss 14 || the first cause of action based on the work slowdown allegation that occurred before 15 || April 30, 2022. The Court also GRANTS Defendant’s motion to dismiss the first cause 16 |/of action for failing to properly allege exhaustion of the grievance process in the CBA 17 ||}concerning the work slowdown with leave to amend. The Court also DISMISSES the 18 || state law claims for lack of supplemental jurisdiction. Plaintiff shall file an amended 19 complaint within 14 days of the date of the order. 20 Finally, the Court DENIES Defendant’s motion to dismiss the state law claims 21 under the anti-SLAPP statute as MOOT. (Dkt. No. 5.) 22 IT IS SO ORDERED. 23 ||Dated: July 20, 2023 (2. □□ 24 Hon. athe Cd 5 United States District Judge 26 27 28