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PANZA v. ARMCO STEEL CORP.

August 22, 1962

Orest PANZA, Frank Smith, Frank Panza, Stanley Halovanic, Joseph Mali, Sam La Cava, and Ralph Zoerb, Plaintiffs,
v.
ARMCO STEEL CORPORATION, Defendant



The opinion of the court was delivered by: GOURLEY

This matter comes before the Court on defendant's motion to dismiss plaintiffs' class suit containing two causes of action:

1. To recover damages for breach of plaintiffs' seniority rights under certain collective bargaining agreements on the shutting down and movement of certain of defendant's plant facilities from Etna to Ambridge, Pennsylvania.

 2. To recover damages based upon defendant's alleged fraud in misrepresenting certain material facts to the Labor Union and the District Court.

 HISTORY

 In order to view the motion in its proper perspective, it is incumbent to review the history of all proceedings which give rise to the present dispute. Since this member of the Court disposed of all matters which related to the controversy since the date that the United States District Court first assumed jurisdiction, I am personally familiar with all the facets and ramifications of the dispute which involved innumerable hours of extra-judicial negotiation and discussion.

 The seeds of the controversy are planted, nurtured and cultivated in the soil of automation and glaringly demonstrates the ruthless toll which automation, as a necessary concomitant to industrial progress, is taking in the stark, bleak reality of loss of livelihoods among so many of our industrial employees.

 The lawsuit is the culmination of the defendant steel company, which has plants at both Etna and Ambridge, Pennsylvania, closing the Etna plant and constructing a new, modern combination pipe mill as an adjunct to the Ambridge plant.

 The closing of the Etna plant was precipitated by its antiquated condition and the inability to operate it profitably. For many years the Etna plant manufactured welded pipe and electrical conduit, and was capable of producing a small range of pipe sizes at only moderate speeds. The decision was therefore made to install a modern combination pipe mill at Ambridge, where the new mill and facilities would be integrated into the Ambridge operations.

 The employment dislocation is glaringly brought into focus in the realization that 328 men employed with the new and modern equipment are producing the equivalent of the same product for which 850 men were employed at Etna.

 At the time that defendant announced its intention of closing the Etna plant, a State Court action was brought in behalf of the United Steelworkers of America by its Locals Nos. 1244 and 2592, and their District Director against the defendant from repudiating collective bargaining agreements between the parties by terminating and discharging the members in the Etna plant of the defendant company and from filling any new job created in Ambridge as a result of the new facilities with members other than those transferred from Etna.

 Thereupon, this member of the Court, after a most extended and protracted argument, ordered the parties to negotiate in an attempt to settle their differences and to proceed to arbitration if a satisfactory settlement was not accomplished.

 As a preliminary to the Court's directed negotiation, the three local unions and their directors were requested by the International Union President, David J. McDonald, to meet in order to develop a harmonious position with respect to the transfer of the Etna employees. In this connection, the extraordinary and conscientious efforts which Mr. McDonald extended in solving a tragic dilemma brought on as a by-product of industrial progress is a tribute and example of dedicated, responsible and competent union leadership.

 The International President selected a three-member commission of the International Executive Board of the Union to assist the locals in reconciling their differences and in developing a unified union position as a ...


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