Akers v. Md. State Educ. Ass'n

990 F.3d 375

Ruth AKERS, on behalf of herself and all others similarly situated; Sharon Moesel, Plaintiffs – Appellants,

v.MARYLAND STATE EDUCATION ASSOCIATION ; Teachers Association of Baltimore County ; National Education Association; Baltimore County Public Schools, as representative of the class of all school districts in Maryland; Larry Hogan, in his official capacity as governor of Maryland; Brian E. Frosh, in his official capacity as Attorney General of Maryland; Elizabeth Molina Morgan, each in their official capacities as members of the Maryland Public School Labor Relations Board; Robert I. Chanin, each in their official capacities as members of the Maryland Public School Labor Relations Board; John A. Hayden, III, each in their official capacities as members of the Maryland Public School Labor Relations Board; Donald W. Harmon, each in their official capacities as members of the Maryland Public School Labor Relations Board; Ronald S. Boozer, each in their official capacities as members of the Maryland Public School Labor Relations Board; Teachers Association of Anne Arundel County, Inc., Defendants – Appellees,andGeorge Arlotto; Verletta White, Defendants.

National Right To Work Legal Defense and Education Foundation, Inc., Amicus Supporting Appellant.

No. 19-1524

United States Court of Appeals, Fourth Circuit.

Argued: December 9, 2020

Decided: March 8, 2021

ARGUED: Jonathan Franklin Mitchell, MITCHELL LAW PLLC, Austin, Texas, for Appellants. Leon Dayan, BREDHOFF & KAISER, P.L.L.C., Washington, D.C., for Appellees. ON BRIEF: Ryan R. Dietrich, Assistant Attorney General, OFFICE OF THE ATTORNEY GENERAL OF MARYLAND, Baltimore, Maryland, for Appellees Larry Hogan, in his official capacity as governor of Maryland; Brian E. Frosh, in his capacity as Attorney General of Maryland; and Elizabeth Molina Morgan, Robert I. Chanin, John A. Hayden, III, Donald W. Harmon, and Ronald S. Boozer, each in their official capacities as members of the Maryland Public School Labor Relations Board. Alice O'Brien, NATIONAL EDUCATION ASSOCIATION, Washington, D.C.; John M. West, Jacob Karabell, BREDHOFF & KAISER, P.L.L.C., Washington, D.C., for Appellees Maryland State Education Association, Teachers Association of Baltimore County, Teachers Association of Anne Arundel County, and National Education Association. Kristy K. Anderson, MARYLAND STATE EDUCATION ASSOCIATION, Annapolis, Maryland, for Appellees Maryland State Education Association, Teachers Association of Baltimore County, and Teachers Association of Anne Arundel County. William L. Messenger, NATIONAL RIGHT TO WORK LEGAL DEFENSE FOUNDATION, INC., Springfield, Virginia, for Amicus National Right to Work Legal Defense Foundation.

Before KING, FLOYD, and THACKER, Circuit Judges.

Affirmed by published opinion. Judge King wrote the opinion, in which Judge Floyd and Judge Thacker joined.

KING, Circuit Judge:

Plaintiffs Ruth Akers and Sharon Moesel — Maryland public school teachers — initiated this civil action in the District of Maryland against four public-sector teachers’ unions (the "union defendants"), a county school system, and various public officials.¹ Pursuant to 42 U.S.C. § 1983, the plaintiffs seek relief for themselves and other non-union Maryland public school teachers who were compelled to pay "representation fees" to unions in order to be employed as Maryland public school teachers. More specifically, the plaintiffs seek a refund of representation fees that they paid to the unions prior to the Supreme Court's decision in Janus v. American Federation of State, County, & Municipal Employees, Council 31 , ––– U.S. ––––, 138 S. Ct. 2448, 201 L.Ed.2d 924 (2018). In Janus , the Court overruled its 1977 decision in Abood v. Detroit Board of Education , 431 U.S. 209, 97 S.Ct. 1782, 52 L.Ed.2d 261 (1977), and decided that requiring non-union employees to pay representation fees to public-sector unions contravenes the First Amendment. The district court dismissed this action in April 2019, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, for failure to state a claim upon which relief can be granted. See Akers v. Md. State Educ. Ass'n , 376 F.Supp.3d 563 (D. Md. Apr. 2019), ECF No. 110 (the "Opinion"). As explained herein, we agree with the Opinion and affirm.

I.

Plaintiffs Akers and Moesel are public school teachers in Maryland who are not members of a public-sector teachers’ union. Akers chose not to join the defendant Teachers Association of Baltimore County. Moesel once joined the defendant Teachers Association of Anne Arundel County but was expelled from it in May 2017. Those county unions are affiliates of the defendants Maryland State Education Association and the National Education Association.

Under Maryland law, a public school teacher was not required to be a member of a county union in order to be employed. In fact, such a union was required by state law to "represent all employees in the [county] fairly and without discrimination, whether or not the employees are members of the [union]." See Md. Code Educ. § 6-407(b). Maryland law, however, also required that the county unions and school districts negotiate a "reasonable service or representation fee[ ] to be charged nonmembers for representing them in negotiations [and] contract administration." Id. § 6-407(c)(1). Thus, a teacher who was not a member of a county union, such as Akers or Moesel, was required to pay representation fees to the union in order to be employed as a Maryland public school teacher.

On June 18, 2018, Akers filed this class action in the District of Maryland, alleging under 42 U.S.C. § 1983 that the First Amendment rights of herself and similarly-situated Maryland public school teachers were being contravened because they were required to pay representation fees as a condition of their employment. Nine days later, on June 27, 2018, the Supreme Court rendered its Janus decision, reversing its 1977 decision in Abood and holding that "public-sector unions may no longer extract [representation] fees from nonconsenting employees." See Janus , 138 S. Ct. at 2486. According to the Janus Court, requiring payment of representation fees to unions by non-union employees contravenes the First Amendment because it constitutes compelled speech. As a result of the Janus decision, public-sector unions, such as the union defendants in this litigation, have ceased collecting representation fees from nonconsenting employees.

On September 7, 2018, Akers and Moesel filed their Amended Complaint in this litigation, naming Moesel as a co-plaintiff. The Amended Complaint — the operative complaint herein — sought, inter alia, a refund of all representation fees collected by the union defendants prior to the Janus decision.

On October 18, 2018, the union defendants and the other defendants moved in two separate filings to dismiss the Amended Complaint, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. For reasons explained in its Opinion of April 18, 2019, the district court granted both dismissal motions. As relevant here, the court determined that the plaintiffs could not recover their payments of pre- Janus representation fees to the union defendants because the "collection of those fees was authorized by state statute and pursuant to Supreme Court precedent, and the good-faith defense bars Plaintiffs’ claim." See Opinion 11. Although at that point in time none of the courts of appeals had addressed the applicability of the good-faith defense in the relevant circumstances, the Opinion adopted the reasoning of multiple federal district courts that had decided the issue. As the Opinion related, those courts "uniformly held that ... the good-faith defense bars refund claims." Id. at 10. Thus, the district court applied the good-faith defense here and dismissed with prejudice the plaintiffs’ Janus claim, along with the balance of the Amended Complaint. The plaintiffs have timely appealed, and we possess jurisdiction pursuant to 28 U.S.C. § 1291.²

II.

With respect to their Janus claim, the plaintiffs contend on appeal that the district court erred by relying on the good-faith defense to dismiss the claim under Federal Rule of Civil Procedure 12(b)(6). We review a Rule 12(b)(6) dismissal de novo. See Turner v. Thomas , 930 F.3d 640, 644 (4th Cir. 2019).

We observe at the outset of our analysis that the plaintiffs’ case is one of several dozen lawsuits being pursued around the country in which non-union employees seek monetary relief for the representation fees they paid to public-sector unions prior to the Janus decision. And every court of appeals to have addressed the question of whether public-sector unions are entitled to interpose the good-faith defense as a bar to the refund of representation fees — that is, the First, Second, Third, Sixth, Seventh, and Ninth Circuits — have held that the good-faith defense bars such claims. See Janus v. Am. Fed'n of State, Cnty., & Mun. Emps., Council 31 , 942 F.3d 352, 366-67 (7th Cir. 2019) (holding that good-faith defense precludes refund of representation fees paid to public-sector unions by nonconsenting employees); Doughty v. State Emps.’ Ass'n of N.H., SEIU Loc. 1984, CTW, CLC , 981 F.3d 128, 134-38 (1st Cir. 2020) (same); Diamond v. Pa. State Educ. Ass'n , 972 F.3d 262, 271-73 (3d Cir. 2020) (same); Wholean v. CSEA SEIU Loc. 2001 , 955 F.3d 332, 334 (2d Cir. 2020) (same); Lee v. Ohio Educ. Ass'n , 951 F.3d 386, 391 (6th Cir. 2020) (same); Danielson v. Inslee , 945 F.3d 1096, 1097 (9th Cir. 2019) (same).

A.

As a threshold matter, we must consider whether the Supreme Court's Janus decision should be accorded retroactive application. If the Janus decision is only entitled to prospective application, the plaintiffs’ claim for reimbursement of the representation fees they paid to the union defendants will necessarily fail. Although the plaintiffs maintain that Janus is entitled to retroactive application, the Supreme Court suggested that...