Liberal Post‑Judgment Amendment and Union Repudiation as an Exhaustion Exception in § 301 LMRA Suits

Introduction

In Yellow Corporation v. International Brotherhood of Teamsters, the Tenth Circuit confronted a high‑stakes labor dispute born from the collapse of Yellow Corporation, formerly the nation’s third-largest less‑than‑truckload carrier. The lawsuit alleges that the International Brotherhood of Teamsters (IBT), the Teamsters’ National Freight Industry Negotiating Committee (TNFINC), and several Kansas locals breached the YRCW National Master Freight Agreement (NMFA) by stonewalling “Phase 2” of Yellow’s “One Yellow” restructuring plan through the Change of Operations (CHOPS) process.

The district court dismissed the complaint under Rule 12(b)(6), holding Yellow failed to exhaust the NMFA’s grievance procedures, denied a footnoted request to amend, and immediately entered judgment. Yellow then moved under Rules 59(e) and 60(b), attaching a proposed amended complaint grounded in late‑produced discovery that, according to Yellow, demonstrated the Teamsters’ repudiation of the grievance process. The district court denied post‑judgment relief and leave to amend, finding the new materials either improper at the 12(b)(6) stage or duplicative.

The Tenth Circuit reversed, holding that when judgment is entered contemporaneously with a first‑time dismissal, post‑judgment leave to amend should be assessed under Rule 15(a)(2)’s liberal standard; that Yellow adequately pleaded the “repudiation” exception to grievance exhaustion for § 301 claims; and that the case is a genuine § 301 contract dispute not committed to the National Labor Relations Board’s primary jurisdiction. The court remanded with instructions to allow amendment and proceed.

Summary of the Opinion

• Standard for post‑judgment leave to amend: Where a district court enters final judgment at the same time it first dismisses a complaint under Rule 12(b)(6), requests to amend are governed by Rule 15(a)(2)’s “freely give when justice so requires” standard (procedurally raised via Rule 59(e)).
• Abuse of discretion: The district court erred by applying a restrictive Rule 59(e) lens and by refusing to consider the significance of newly obtained discovery in evaluating whether amendment should be allowed.
• Futility rejected: Assuming without deciding that Yellow had to exhaust contractual grievance procedures, Yellow’s proposed amended complaint adequately pleaded that the Teamsters repudiated the NMFA’s grievance process—an exception excusing exhaustion—so amendment would not be futile.
• NLRB primary jurisdiction: The dispute is a bona fide § 301 contract case about alleged breach/repudiation of the NMFA’s dispute‑resolution mechanisms, so the NLRB does not have primary jurisdiction under Garmon.
• Remand: The district court must permit amendment and then consider remaining issues, including whether Yellow Corporation and IBT are proper parties.

Analysis

Precedents Cited and Their Influence

• Foman v. Davis (U.S. 1962): The Supreme Court established that leave to amend should be “freely given when justice so requires.” The Tenth Circuit hewed closely to Foman’s liberal ethos, particularly where dismissal and judgment arrive simultaneously, and relied on Foman to resist “technicalities” that would defeat merits‑based adjudication.
• Triplett v. LeFlore County (10th Cir. 1983) and Glenn v. First Nat’l Bank in Grand Junction (10th Cir. 1989): These decisions instruct that plaintiffs should be afforded a chance to correct pleading defects, and that the proper mechanism post‑judgment is Rule 59(e) or Rule 60(b), followed by Rule 15—but the substantive standard remains the liberal Rule 15 test when judgment and first dismissal coincide.
• Tool Box, Inc. v. Ogden City (10th Cir. 2005) and Taylor v. Salvation Army (7th Cir. 2024): Tool Box warned against liberal amendment after judgment where the movant could have amended earlier; Taylor clarified that when judgment issues at first dismissal, Rule 15(a)(2) still controls. The Tenth Circuit aligned with Taylor, distinguishing Tool Box because Yellow lacked a meaningful pre‑judgment opportunity to amend given the timing of discovery and immediate entry of judgment.
• BLOM Bank SAL v. Honickman (U.S. 2025): The Supreme Court clarified that Rule 60(b)(6) relief requires “extraordinary circumstances,” even when a party seeks to reopen to amend. The Tenth Circuit reconciled Honickman by emphasizing this case was postured under Rule 59(e) within 28 days of judgment, avoiding the finality concerns that trigger the more stringent Rule 60(b)(6) standard, and therefore still governed by Rule 15(a)(2)’s liberal principles.
• Frank v. U.S. West (10th Cir. 1993) and Watson v. Beckel (10th Cir. 2001): These frame the Rule 15 considerations (undue delay, prejudice, bad faith, repeated failure to cure, futility) and the futility inquiry (amended complaint would still be dismissed). The court found no undue delay or prejudice and rejected futility.
• Republic Steel v. Maddox (U.S. 1965) and United Paperworkers v. Misco (U.S. 1987): These anchor the general rule that bargained‑for grievance mechanisms must be exhausted before suit. The Tenth Circuit accepted that premise arguendo, then focused on exceptions.
• Drake Bakeries v. Local 50 (U.S. 1962): Employers, no less than employees, are bound to grievance procedures unless the contract says otherwise. This framed the default setting in which Yellow had to show a recognized exception.
• Vaca v. Sipes (U.S. 1967) and Glover v. St. Louis–San Francisco Ry. (U.S. 1969): Vaca recognized that repudiation by the other party excuses exhaustion; Glover recognized a futility exception. The Tenth Circuit identified the “repudiation” branch as most apt here and did not need to draw precise lines between repudiation and futility.
• Garcia v. Eidal International (10th Cir. 1986), United Food & Commercial Workers Local 7R v. Safeway (10th Cir. 1989), and Sidhu v. Flecto (9th Cir. 2002): These supply the repudiation standard—an express refusal to use grievance/arbitration machinery, or conduct making compliance impossible or apparently so; a party need not formally disclaim arbitration if conduct supports an inference of repudiation. The Tenth Circuit applied this to unions just as to employers.
• Marquez v. SAG (U.S. 1998) and San Diego Bldg. Trades Council v. Garmon (U.S. 1959): While Garmon sends “arguably protected/prohibited” conduct to the NLRB, the Tenth Circuit emphasized the § 301 carve‑out for genuine contract suits.
• William E. Arnold Co. v. Carpenters (U.S. 1974) and Smith v. Evening News (U.S. 1962): Section 301 contract‑based claims remain judicially cognizable even where conduct also touches NLRA sections 7/8. This supported rejecting the primary jurisdiction defense.
• Int’l Bhd. of Elec. Workers Local 71 v. Trafftech (6th Cir. 2006) and Ketchikan Pulp (9th Cir. 1980): Courts guard against “end‑run” § 301 pleading that is really an NLRA dispute. The panel concluded Yellow’s case is not such an end‑run; it squarely concerns alleged breach/repudiation of NMFA dispute‑resolution clauses.

Legal Reasoning

1. Procedural standard for amendment after simultaneous dismissal and judgment:
   • The court held that although the vehicle was Rule 59(e), the governing substantive standard for leave to amend was Rule 15(a)(2)’s liberal “freely give” standard because judgment was entered at the same time as the first dismissal. This avoids penalizing a plaintiff who had no realistic chance to amend before judgment and aligns with Foman and the Seventh Circuit’s Taylor.
   • Applying Rule 15, the court found no undue delay (discovery was produced late and near the dismissal), no undue prejudice, no bad faith, and no repeated failures to cure.
   • Even under Rule 59(e), the court reasoned the newly discovered evidence mattered—not as “evidence” to decide a 12(b)(6) motion, but because it informed the proposed amendment’s non‑conclusory allegations; denying relief therefore was an abuse of discretion under either framework.
2. Exhaustion and the repudiation exception:
   • Assuming Yellow was bound to exhaust the NMFA grievance machinery, the panel recognized a settled exception: a party need not exhaust when the other party repudiates the contractual dispute‑resolution process.
   • Repudiation exists where there is an express refusal to use the machinery, or conduct rendering compliance impossible or apparently so; a formal disclaimer is unnecessary if conduct supports a repudiation inference (Garcia; Sidhu).
   • Yellow’s proposed amendment alleged categorical opposition to Phase 2 CHOPS “under any circumstances” absent renegotiation, directives to locals to oppose even revised proposals, public and internal statements (e.g., “done making concessions,” “go after [Yellow]”), walking out of a CHOPS meeting, and unilaterally cancelling a scheduled CHOPS hearing.
   • Although the parties disputed whether the CHOPS process itself is a “grievance” process, the court took reasonable inferences in Yellow’s favor: a refusal to engage the CHOPS process as part of a broader strategy to “walk away from the table” plausibly implies repudiation of the NMFA’s Article 8 grievance procedures as well.
   • The court emphasized a limiting principle: mere “deadlock” is not repudiation. What matters is a refusal to initiate or participate in the grievance machinery. Yellow pleaded more than disagreement; it alleged the Teamsters effectively “walked away.”
3. Primary jurisdiction:
   • Although the Teamsters reframed the case as an NLRA “refusal to bargain” dispute within the NLRB’s primary jurisdiction, the Tenth Circuit held the claim is a genuine § 301 contract suit about breach/repudiation of the NMFA’s dispute‑resolution obligations.
   • Because § 301 contract claims coexist with the NLRA and are not displaced by Garmon where the claim hinges on contract interpretation and enforcement, no stay for primary jurisdiction was warranted.
4. Disposition:
   • The court reversed the denial of the Rule 59(e) motion and leave to amend, held that amendment is not futile given adequately pleaded repudiation, and remanded with instructions to allow amendment (including updates for post‑appeal developments) and to consider unresolved issues (e.g., whether Yellow Corporation and IBT are proper parties).

Impact

• Post‑judgment amendment practice in the Tenth Circuit:
  • This decision clarifies that when a district court enters judgment concurrently with a first dismissal, district courts should evaluate a prompt request to amend under Rule 15(a)(2)’s permissive standard. Parties should attach a proposed amended complaint to any timely Rule 59(e) motion and explain why the Rule 15 factors favor leave.
  • Late‑produced discovery that could not be meaningfully reviewed before dismissal can justify amendment; courts should not exclude it simply because it was “outside the pleadings” for the initial 12(b)(6) ruling—its relevance is to the proposed pleading, not the dismissed one.
• Substance of § 301 LMRA litigation:
  • The decision fortifies the “repudiation” exception to grievance‑exhaustion against unions, not just employers. Allegations of categorical refusal to utilize grievance/CHOPS mechanisms, coupled with concrete obstructive acts, can excuse exhaustion.
  • At the same time, courts will distinguish between hard‑nosed bargaining that produces deadlock (not an excuse) and conduct that amounts to walking away from the grievance table (potential repudiation).
  • By keeping the case in federal court under § 301 and rejecting the primary‑jurisdiction gambit, the panel underscores that contract‑based claims about grievance mechanisms remain judicially resolvable, even when the backdrop is a heated bargaining dispute.
• Practical effects for unions and employers:
  • Unions and employers should avoid categorical public or internal statements that could be construed as refusing to engage contractually mandated dispute‑resolution processes. Strategic cancellation of committee hearings or coordinated refusals may be cast as repudiation.
  • Parties should meet discovery deadlines; tactical delay near dispositive motion practice may backfire, strengthening an opponent’s argument for post‑judgment amendment.
  • Employers, often defendants in exhaustion disputes, may invoke repudiation when unions are alleged to block access to grievance machinery—this opinion collects the doctrinal building blocks and adapts them to that posture.
• Persuasive value:
  • Although issued as a nonprecedential order and judgment, the opinion can be cited for its persuasive value under Fed. R. App. P. 32.1 and Tenth Circuit Rule 32.1. Its harmonization with Foman, Taylor, and Honickman positions it as an influential procedural roadmap for district courts within the circuit.

Complex Concepts Simplified

• Section 301 LMRA suit: A federal cause of action to enforce a collective bargaining agreement (CBA). It lets either side sue over breaches of the CBA, including failures to use agreed‑upon grievance processes.
• Grievance exhaustion: Many CBAs require disputes to go through internal, contractual procedures first. Courts typically require parties to use those procedures before filing suit.
• Repudiation exception: If the other side has effectively refused to engage the grievance process (expressly or by conduct making it impossible or evidently so), you are excused from exhausting and can sue directly.
• Futility exception: If using the grievance process would be wholly pointless (for example, because the process is structurally biased or preordained), a party may be excused from exhaustion. The court focused here on repudiation and did not need to define the outer boundary of “futility.”
• CHOPS vs. grievance procedures: Under the NMFA, CHOPS committees address operational changes affecting seniority/working conditions; Article 8 grievance procedures address disputes over CBA interpretation. A refusal to engage CHOPS can, as a matter of reasonable inference, imply a refusal to engage the broader grievance machinery where both concern the same dispute.
• Rule 15(a)(2) liberal amendment: Courts should “freely give” leave to amend unless there is undue delay, prejudice, bad faith, repeated failure to cure, or futility. This standard applies even after judgment if judgment was entered at the same time as the first dismissal and the request to amend is timely via Rule 59(e).
• Rule 59(e) vs. Rule 60(b)(6): Rule 59(e) allows timely motions to alter or amend judgments within 28 days and does not trigger the same finality concerns as Rule 60(b)(6), which requires “extraordinary circumstances.” When used to seek leave to amend after a first dismissal with immediate judgment, courts look to Rule 15(a)(2)’s liberal standard.
• Primary jurisdiction/Garmon: The NLRB has primary jurisdiction over conduct arguably protected or prohibited by the NLRA (Garmon). But § 301 contract disputes about CBA enforcement are judicially cognizable; calling something a “contract” claim is not enough, but here the core issue—repudiation of grievance machinery—is genuinely contractual.

Conclusion

The Tenth Circuit’s decision delivers two major takeaways. First, it clarifies procedural law: when a district court dismisses a complaint and simultaneously enters judgment, a prompt post‑judgment request to amend is governed by Rule 15(a)(2)’s liberal standard. Courts should permit amendment absent the classic Foman factors, and newly produced discovery that could not be reviewed earlier properly informs whether an amendment would be non‑conclusory and non‑futile.

Second, it refines labor law doctrine in a § 301 setting: at the pleading stage, concrete allegations that a union walked away from the contractually mandated dispute‑resolution machinery can satisfy the repudiation exception to exhaustion. The opinion distinguishes ordinary bargaining impasse from conduct tantamount to refusal to utilize CHOPS/grievance processes, and it keeps genuine contract‑interpretation disputes in court notwithstanding Garmon.

On remand, Yellow gets to file an amended complaint, and the district court will address unresolved issues, including proper parties. More broadly, this decision signals to labor‑management actors that categorical refusals to engage contractual dispute‑resolution processes risk excusing exhaustion and inviting judicial intervention, and it instructs trial courts in the Tenth Circuit to apply Rule 15’s liberal standard when first‑time dismissals and judgments converge.