the St. Thomas - St. John Hotel & Tourism Association, Inc. v. Governm Ent of the United States Virgin Islands by

PRECEDENTIAL
UNITED STATES COURT OF
APPEALS
FOR THE THIRD CIRCUIT
________
No: 02-3621
THE ST. THOMAS - ST. JOHN HOTEL
&
TOURISM ASSOCIATION, INC.;
THE ST. THOMAS - ST. JOHN
CHAMBER OF
COMM ERCE, INC. and THE ST.
CROIX HOTEL & TOURISM
ASSOCIATION, INC.,
Appellants
v.
GOVERNM ENT OF THE UNITED
STATES
VIRGIN ISLANDS BY AND
THROUGH
THE VIRGIN ISLANDS
DEPARTMENT
OF LABOR; ELECUTERIA ROBERTS
IN HER OFFICIAL CAPACITY AS
ACTING
COMM ISSIONER OF THE VIRGIN
ISLANDS
DEPARTMENT OF LABOR
ESLA HUGGINS, LADIAH WHYTE,
(Intervenor in D.C.)
Appeal from the District Court of the
Virgin Islands
(D.C. Civil Action No. 99-cv-00054)
District Judge: Honorable Thomas K.
Moore
Argued on April 28, 2003
Before: ROTH, MCKEE and COWEN
Circuit Judges
(Opinion filed February 11, 2004)
Iver A. Stridiron
Attorney General
Elliott M. Davis
Solicitor General
Carol S. Moore
Assistant Attorney General
Department of Justice
48B-50C Kronprindsens Gade
GERS Building, 2nd Floor
Charlotte Amalie
St. Thomas, USVI 00802
Kathleen Navin, Esquire (Argued)
Legal Services of Virgin Islands
3017 Estate Orange Grove
Christiansted
Saint Croix, USVI, 000820
Counsel for Appellees
Charles E. Engeman, Esquire (Argued)
David J. Comeaux, Esquire
Ogletree, Deakins, Nash, Smoak &
Stewart, LLC
1336 Beltjen Road, Suite 202
Charlotte Amalie
St. Thomas, USVI 00802
Counsel for Appellants

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O P I N I O N
ROTH, Circuit Judge
This appeal presents the question
whether the Virgin Islands Wrongful
Discharge Act (WDA), 24 V.I. Code Ann.
§§ 76-79 is preempted by the National
Labor Relations Act (NLRA), 29 U.S.C.
§§ 151-169, and, if not, whether the
application of the WDA to supervisors is
preempted by the NLRA. A prior panel of
this Court addressed the first issue at the
preliminary injunction phase and decided
that the WDA was not preempted. We
adhere to that decision. The prior panel
left open the second issue. On remand, the
District Court held that the NLRA does not
preempt the application of the WDA to
supervisors. This appeal followed.
I. Facts and Procedural History
In 1986, the Virgin Islands
legislature enacted Section 76 of the
WDA, which limited the grounds upon
which an employer may terminate an
employee. The statute provided, in
relevant part, as follows:
(a) Unless modified by
contract, an employer may
dismiss an employee:
(1) who engages in a
business which conflicts
with his duties to his
employer or renders him a
rival of his employer;
(2) whose insolent or
offensive conduct towards a
customer of the employer
injures the em ployer’s
business;
(3) whose use of intoxicants
or controlled substances
interferes with the proper
discharge of his duties;
(4) who wilfully and
i n t e n t i o n a l l y d i s o b e ys
reasonable and lawful rules,
orders, and instructions of
the employer; provided,
however, the employer shall
not bar an employee from
patronizing the employer’s
b u s i n e s s a f t e r t h e
employee’s working hours
are complete;
(5) who performs his work
assignments in a negligent
manner;
(6) wh ose c onti nuous
absences from his place of
em ploym ent affect the
interests of his employer;
(7) who is incompetent or
i n e f f i c i e n t , t h e r e b y
impairing his usefulness to
his employer;

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(8) who is dishonest; or
(9) whose conduct is such
that it leads to the refusal,
reluctance or inability of
other employees to work
with him.
****
( c ) A n y e m p l o y e e
discharged for reasons other
t h a n t h o s e stated in
subsection (a) of this section
shall be considered to have
been wrongfully discharged;
however, nothing in this
section shall be construed as
prohibiting an employer
f r o m t e r m i n a ti n g a n
employee as a result of the
cessati o n o f b u s i ness
operations or as a result of a
general cutback in the work
force due to economic
hardship, or as a result of
the employee’s participation
in concerted activity that is
not protected by this title.
24 V.I. Code Ann. § 76 (1986). Any
employee covered by the WDA and
discharged in violation of Section 76 may
file an administrative complaint with the
Commissioner of Labor, who has the
authority to order reinstatement and back
pay. 24 V.I. Code Ann. § 77. In addition,
an employee may file a lawsuit for
compensatory and punitive damages. 24
V.I. Code Ann. § 79.
In 1996, the Virgin Islands
legislature amended the first sentence of
subsection (a) of the statute to state
“[u]nless modified by union contract . . ..”
24 V.I. Code Ann. § 76 (1996) (emphasis
added). This amended provision has been
interpreted to apply to all employees in the
Virgin Islands, absent a collective
bargaining agreement setting discharge
terms to the contrary. See St. Thomas–St.
John Hotel & Tourism Ass’n, Inc. v. Gov’t
of the U.S. Virgin Islands, 218 F.3d 232,
236 (3d Cir. 2000) (Hotel Association II).1
On April 5, 1999, the St.
Thomas–St. John Hotel & Tourism
Association, Inc., the St. Thomas–St. John
Chamber of Commerce, Inc., and the St.
Croix Hotel & Tourism Association, Inc.
(collectively the “associations”) filed this
action in the District Court of the Virgin
Islands against the Government of the
Virgin Islands, the Virgin Islands
Department of Labor, and the Acting
Commissioner of the Department of
1 In 2000, the Virgin Islands
Legislature amended the definition of
“employee” under the WDA to exclude
“any person employed in a bonafide
position in an executive or professional
capacity.” See St. Thomas–St. John
Hotel & Tourism Ass’n, Inc. v. Gov’t of
the U.S. Virgin Islands, 216 F. Supp. 2d
460, 462 (D.V.I. 2002) (Hotel
Association III). The issue of the
coverage under the WDA of supervisory
employees who are not executives or
professionals is still, however, before us.

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4
Labor, seeking to restrain the enforcement
of the WDA in any pending or future
WDA wrongful discharge proceeding.
Elsa Huggins and Ladiah Whyte, two
employees who have WDA claims pending
before the Department of Labor,
intervened as additional defendants. The
associations alleged that the WDA was
preempted by the NLRA and deprived
them of federal rights in violation of 42
U.S.C. § 1983. They sought declaratory
and injunctive relief under the Declaratory
Judgment Act, 28 U.S.C. §§ 2201, 2202,
injunctive relief under 42 U.S.C. § 1983,
and attorney’s fees under 42 U.S.C. § 1988
and 5 V.I. Code Ann. § 541.
Following a hearing, the District
Court concluded that the plaintiffs were
likely to succeed on the merits of their
preemption claim and issued a preliminary
injunction. See St. Thomas–St. John Hotel
& Tourism Ass’n, Inc. v. Gov’t of the U.S.
Virgin Islands, Civ. No. 1999-54, 1999
WL 376873 (D.V.I. June 3, 1999) (Hotel
Association I). We reversed, holding that:
the WDA is not preempted
by the NLRA even though it
provides an opt-out by
express terms of union
contract. . . . [T]he WDA
does not force an employee
to choose between collective
b a r g a i n i n g a n d t h e
protections of state law;
rather, it protects all Virgin
Island employees, but gives
employees the option of
relinquishing the territorial
statutory protections through
the terms of the collective
bargaining agreement.
Hotel Association II, 218 F.3d at 245.
However, in Hotel Association II, the
Court expressly left open the issue whether
the WDA, as applied to supervisors, was
preempted by the NLRA. In remanding
the case to the District Court to grant
summary judgment to the defendants on
the issue of general preemption, we noted
that “there remains for decision by the
District Court the associations’ claim that
the WDA should not be applied to
supervisors.” Id. at 246.
On remand, the District Court
denied the associations’ motion for
summary judgment on the question
whether the NLRA preempts the WDA as
applied to all employees. Following
supplemental briefing, the District Court
held that the NLRA does not preempt
application of the WDA to supervisors and
granted defendants’ motion for summary
judgment as to all claims. See St.
Thomas–St. John Hotel & Tourism Ass’n,
Inc. v. Gov’t of the U.S. Virgin Islands,
216 F. Supp. 2d 460, 466-68 (D.V.I. 2002)
(Hotel Association III).2 Plaintiffs timely
2The District Court also held that
supervisors are covered by the WDA
because supervisors are employees under
24 V.I. Code Ann. § 62. See Hotel
Association III, 216 F. Supp. 2d at 463-
64. Since plaintiffs do not appeal this
issue, we do not address it.

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appealed.3
II. Jurisdiction and Standard of
Review
The District Court had jurisdiction
over this federal question pursuant to 28
U.S.C. § 1331. We have jurisdiction over
the District Court’s final order pursuant to
28 U.S.C. § 1291. We exercise plenary
review over a grant of summary judgment.
Chisolm v. McManimon, 275 F.3d 315,
321 (3d Cir. 2001). Summary judgment is
appropriate if there is no genuine issue of
material fact and the moving party is
entitled to judgment as a matter of law.
Fed. R. Civ. P. 56(c); Anderson v. Liberty
Lobby Inc., 477 U.S. 242, 250 (1986).
III. Discussion
1. Preemption of the WDA as Applied to
all Employees:
We decline the associations’
request that we reconsider the prior panel’s
holding in Hotel Association II regarding
preemption of the WDA as applied to all
employees. Under the law of the case
doctrine, “one panel of an appellate court
generally will not reconsider questions that
another panel has decided on a prior
appeal in the same case. The doctrine is
designed to protect traditional ideals such
as finality, judicial economy and
jurisprudential integrity.” In re City of
Philadelphia Litig., 158 F.3d 711, 717-18
(3d Cir. 1998).
However, as this Court recognized
in Council of Alternative Political Parties
v. Hooks, “‘while the law of the case
doctrine bars courts from reconsidering
matters actually decided, it does not
prohibit courts from revisiting matters that
are avowedly preliminary or tentative.’”
179 F.3d 64, 69 (3d Cir. 1999).
Preliminary injunctions are, by their
nature, tentative and impermanent. See
R.R. Yardmasters of Am. v. Pennsylvania
R.R. Co., 224 F.2d 226, 229 (3d Cir.
1955). Thus:
T h e p u r p o s e o f a
preliminary injunction is
merely to preserve the
relative positions of the
parties until a trial on the
merits can be held. Given
this limited purpose, and
given the haste that is often
necessary if those positions
3We note with great concern that the
Government of the United States Virgin
Islands, the Virgin Islands Department of
Labor, and the Commissioner of the
Department of Labor did not see fit to
send an attorney to oral argument of this
appeal before us. The only defendants
who were represented at oral argument
were the intervenors, but their attorney
admitted that the intervenors were not
supervisors. Nevertheless, despite the
intervenors’ lack of standing to address
the issue of the status of supervisors, we
permitted them to present argument in
support of the government’s position in
light of the need to have a full discussion
of this important issue.

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are to be preserved, a
preliminary injunction is
customarily granted on the
basis of procedures that are
less formal and evidence
that is less complete than in
a trial on the merits. A party
thus is not required to prove
his case in full at a
p r e l i m i n a r y - i n j u n c t i o n
hearing, and the findings of
fact and conclusions of law
made by a court granting a
preliminary injunction are
not biding at trial on the
merits.
Univ. of Texas v. Camenisch, 451 U.S.
390, 395 (1981).
Nevertheless, under this standard
for preliminary matters, the plaintiffs have
pointed to no adequate reason for
departing from the holding in Hotel
Association II. There is no intervening
new facts or law. See In re City of
Philadelphia Litig., 158 F.3d at 718. Nor
was the earlier decision so clearly
erroneous that it would create a manifest
injustice. See id. Finally, the plaintiffs
have not pointed to anything about the
more informal procedure of determining
whether to grant or deny a preliminary
injunction that resulted in an erroneous
decision. See Camenisch, 451 U.S. at 395.
Therefore, this panel adheres to the
decision in Hotel Association II that the
WDA, as applied to employees, is not
preempted by the NLRA.
2. Preemption of the WDA as Applied to
Supervisors:
Turning to the issue left open by
Hotel Association II, we hold that the
District Court in Hotel Association III
erred in concluding that the WDA , as
applied to supervisors, is not preempted by
the NLRA. The Supremacy Clause of the
United States Constitution provides that
the laws of the United States “shall be the
supreme Law of the Land . . . any Thing in
the Constitution or Laws of any State to
the Contrary notwithstanding.” U.S.
Const. Art. VI, cl. 2. This principle
applies to the laws of the Virgin Islands
through the Revised Organic Act, which
authorizes the Virgin Islands legislature to
enact territorial laws that are “not
inconsistent with . . . the laws of the
United States made applicable to the
Virgin Islands . . . .” 48 U.S.C. § 1574(a).
Under this Clause:
The Supreme Court has
recognized three general
ways in which federal law
may preempt, and thereby
displace, state law: 1)
“ e x p r e s s p re e m pt i o n ,”
which arises when there is a
a n e x p l i c i t st a t u to r y
command that state law be
displaced, see Morales v.
Trans World Airlines, Inc.,
504 U.S. 374 (1992); 2)
“field preemption,” which
arises when federal law “so
thoroughly occupies a
legislative field as to make

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reasonable the inference that
Congress left no room for
the states to supplement it,”
Cipollone v. Liggett Group,
Inc., 505 U.S. 504, 516
(1992) (internal quotation
omitted); and 3) “conflict
preemption,” which arises
when a state law makes it
impossible to comply with
both state and federal law or
when state law “stands as an
o b s t a c l e t o t h e
a c c o m p l i s h m e n t a n d
execution of the full purpose
and objectives of Congress,”
Hines v. Davidowitz, 312
U.S. 52, 67 (1941).
Hotel Association II, 218 F.3d at 238.
Since the NLRA does not contain
an express preemption provision and it
regulates an area traditionally regulated by
the states, there is a presumption that
Congress did not intend to displace state
law. See id. Thus, state law will not be
preempted by the NLRA unless the state
law conflicts with the NLRA’s express
provisions or underlying goals and
policies. See id. A state or territorial law
conflicts with the NLRA if it stands as an
obstacle to the accomplishment and
execution of the full purposes and
objectives of Congress. See id.4
Section 14(a) of the NLRA
provides that “no employer . . . shall be
compelled to deem individuals defined
herein as supervisors as employees for the
purpose of any law, either national or
local, relating to collective bargaining.”
4The District Court in Hotel
Association III correctly recognized that
the proper analysis in this case is not
guided by the two dominant federal labor
law preemption principles set forth in
San Diego Building Traders Council v.
Garmon, 359 U.S. 236 (1959) and
International Ass’n of Machinists v.
Wisconsin Employment Relations
Comm’n, 427 U.S. 132 (1976). See
Hotel Association III, 216 F. Supp. 2d at
465 n. 4. Garmon preemption displaces
state jurisdiction over conduct which is
“arguably within the compass of § 7 or §
8 of the Act.” Hotel Association II, 218
F.3d at 239 (quoting Garmon, 359 U.S.
at 246). Machinists preemption is a form
of conflict preemption under which state
regulation of the bargaining conduct of
private parties is displaced because it
conflicts with the purpose of Congress in
enacting the NLRA to leave that conduct
“to be controlled by the free play of
economic forces.” Id. (quoting
Machinists, 427 U.S. at 140). However,
while the subspecies of Garmon and
Machinists preemption often are invoked
in connection with the NLRA, the field
of labor law also is subject to the general
preemption principles outlined above.
See id. Thus, the issue in the present
case is whether, under general principles
of conflict preemption, the WDA
conflicts with the NLRA. See id.;
Livadas v. Bradshaaw, 512 U.S. 107, 120
(1994).

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29 U.S.C. § 164(a). The purpose of this
section is to redress a perceived imbalance
in labor-management relationships that
arose from putting supervisors in the
position of serving two masters with
opposing interests, namely their employer
and their union. See Beasley v. Food Fair
of North Carolina, 416 U.S. 653, 657
(1974). The Supreme Court in Beasley
recognized that “‘Congress’ propelling
intention [in enacting Section 14(a)] was
to relieve employers from any compulsion
under the Act and under state law to
countenance or bargain with any union of
supervisory employees . . ..’” Id. at 657
(quoting from Hanna Mining Co. v.
District 2, Marine Engineers Beneficial
Ass’n, 382 U.S. 181, 189 (1965)). Thus,
the Court struck a state statute that
permitted supervisors to seek damages
against employers who discharged them
for union membership because it “plainly
put pressure on [the employers] ‘to accord
to the front line of management the
anomalous status of employees,’ and
would therefore flout the national policy
against compulsion upon employers from
either federal or state agencies to treat
supervisors as employees.” Id. at 662
(quoting S.Rep. No. 105 80th Cong., 1st
Sess. at 5 (1947)). Beasley, thus, teaches
that state (or territorial) laws that pressure
employers to accord supervisors the status
of employees for collective bargaining
purposes conflict with Section 14(a) of the
NLRA. See id. As noted in the Senate
Report quoted in Beasley, the result of
supervisors serving two masters, and not
being loyal to the employers’ interests, was
evident in the coal mines, where, after
supervisory employees were organized,
disciplinary slips fell off by two thirds and
the accident rate doubled. Id. at 661
(quoting S.Rep. No. 105 at 3, 4).
Turning then to the territorial law
before us, if the WDA is applied to
supervisors, the only way for an employer
to alter or expand the WDA’s nine
enumerated grounds for terminating a
supervisor/employee would be to enter a
“union contract” with the supervisor. But
the qualities an employer looks for in
supervisors are not the same as those an
employer looks for in employees. There
are aspects of management that extend
beyond the work qualities enumerated in
the causes for discharge permitted under
the WDA. An employer may consider it
essential that a supervisor’s mastery of
these aspects of management be a
condition of employment. Under the
WDA, however, in order to incorporate
those other grounds for discharge into an
employment contract with a supervisor, the
employer would have to bargain with the
supervisor as an employee. Moreover, if
the supervisors, as the front line of
management, were answerable not only to
the employer but also to the union, the
employer’s ability to safely, efficiently,
and productively manage the business
might suffer.
Under Beasley, pressure upon
employers to treat supervisors as
employees and to bargain with them as
such violates Section 14(a). See 416 U.S.
at 657. We conclude that the WDA would
have such an effect on employers by

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exerting a significant degre e of
compulsion upon employers to bargain
with supervisors as employees; thus the
WDA violates Section 14(a).
The District Court in Hotel
Association III, however, read Beasley as
holding that a state or territorial statute
conflicts with Section 14(a) only when the
effect of the statute is to “afford
supervisors a cause of action that they
would not otherwise have under the
NLRA.” Hotel Association III, 216 F.
Supp. 2d at 465. This reading of Beasley
is incomplete. The holding in Beasley is
not merely that it is a violation of Section
14(a) if state law affords supervisors a
cause of action that they would not have
under thE NLRA. Beasley goes further to
establish that it is a violation of Section
14(a) if the state law “relating to collective
bargaining,” – whether or not it affords a
cause of action to supervisors – “‘puts
pressure on [employers] to accord to the
front line of management the anomalous
status of employees.’” 416 U.S. at 662
(quoting S .Rep. No. 105 at 5). Such a law
would “flout the national policy against
compulsion upon employers from either
federal or state agencies to treat
supervisors as employees.” Id.
So long as a state or territorial
statute creates some pressure to bargain
collectively with supervisors, be it direct
or indirect, the statute creates the
possibility of forcing employers to divide
the loyalties of their supervisors between
the employer and the union. As Beasley
recognized, it is this pressure that Section
14(a) seeks to combat. The directness of
the pressure may affect the strength of the
incentive rather than its existence.
However, the Supreme Court, by stating in
Beasley that Congress intended to prevent
“any compulsion,” clearly recognized that
Section 14(a) prohibits the creation of any
pressure to collectively bargain with
supervisors. 416 U.S. at 657.
Thus, in Washington Service
Contractors Coalition v. District of
Columbia, the District Court for the
District of Columbia held that a statute that
indirectly compelled an employer to
bargain collectively with supervisors
conflicted with Section 14(a). See 858 F.
Supp. 1219, 1221 (D.D.C. 1994), rev’d on
other grounds, 54 F.3d 811 (D.C. Cir.
1995). In that case, the District of
Columbia enacted a statute that required
contractors to retain many of their
predecessor’s employees af ter the
contractors took over a service contract.
The District Court held that the statute
compelled the employer to bargain with
the supervisors collectively in violation of
Section 14(a). The court found that,
because the statute applied to supervisors,
if a predecessor’s supervisors were
unionized, the statute could indirectly
compel an employer to bargain collectively
with supervisors by preventing the
e m p l o y er f r o m t e r m i n a t i n g t h e
predecessor’s supervisors. See id. at 1225.
As in Washington Service
Contractors Coalition, the WDA does not
directly require that an employer
collectively bargain with supervisors.

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Nevertheless, the WDA indirectly compels
an employer to bargain collectively with
supervisors by requiring that an employer
who wishes to alter the WDA’s grounds
for terminating a supervisor enter into a
collective bargaining agreement. Since
this limitation constitutes pressure to
bargain with supervisory employees, the
WDA, as applied to supervisors, conflicts
with Section 14(a) of the NLRA
IV. Conclusion
For the reasons stated above, the
judgment of the District Court as to
general preemption will be affirmed. The
judgment in favor of the government
defendants as to the application of the
WDA to supervisors will be vacated and
this question will be remanded to the
District Court with instructions to enter
judgment in favor of plaintiffs.

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