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LOCAL 4076, USW v. USW

January 27, 1972

Local 4076, United Steelworkers of America, Plaintiff,
United Steelworkers of America, AFL-CIO; Local 1465, et al., Defendants

Teitelbaum, District Judge.

The opinion of the court was delivered by: TEITELBAUM

This is an action brought under Section 301 of the Labor Management Relations Act of 1947, as amended, *fn1" (29 U.S.C. § 185, as amended) by a displaced group of employees designated, for the purpose of this action, as Local 4076, United Steelworkers of America ("Local 4076"). The action alleges (1) a breach of a contract between an employer and a labor organization in the form of an arbitration award incident to a collective bargaining agreement, and (2) a breach of a union's duty of fair representation. The defendants are Woodings-Verona Tool Works; the United Steelworkers of America, AFL-CIO ("United Steelworkers"); and Local 1465, United Steelworkers of America ("Local 1465").

 The relevant facts are found in the stipulations of the parties and the evidence introduced at the non-jury trial of this action. Defendant United Steelworkers was, prior to November 20, 1967, the duly certified and authorized bargaining representative of the production employees of both the defendant Woodings-Verona and The Klein Logan Company. To assist it administratively, the United Steelworkers had created Locals 1465 and 4076 to represent the employees of Woodings-Verona and Klein Logan, respectively. On November 20, 1967, Woodings-Verona purchased Klein Logan. Subsequently, Woodings-Verona notified the United Steelworkers that it intended to move the Klein Logan operations, including the Klein Logan employees, from Pittsburgh to Oakmont, Pennsylvania, the site of its principal plant. It is this offer to assimilate the Klein Logan employees which, ironically, is the source of the present problem.

 At the time of the purchase there were existing two labor agreements -- one between Klein Logan and the United Steelworkers, covering the period from September 30, 1965 to September 25, 1968, and another between Woodings-Verona and the United Steelworkers, covering the period from November 25, 1965 to October 1, 1968. Too, there were existing two separate seniority lists -- one covering the Klein Logan employees and the other covering the Woodings-Verona employees. Prior to November 20, 1967, the two lists were completely independent of each other. The proposed interweaving of the employees of the two companies, however, produced the problem of interweaving the two seniority lists as well. The employees of Woodings-Verona (Local 1465) urged that any and all of the incoming employees from Klein Logan be afforded seniority with Woodings-Verona only from November 20, 1967. Conversely, the employees of Klein Logan urged that any and all transferred employees be fully credited with the seniority which they accrued while with Klein Logan. When the parties found themselves unable to resolve the problem, they put it to final and binding arbitration, presumably pursuant to both labor agreements. *fn2"

 Thereafter, between July 29, 1968 and August 19, 1968, the transfer of the Klein Logan employees was effected and with the dissolution of Klein Logan, the labor agreement between it and the United Steelworkers terminated. Consequently, on February 25, 1969, the United Steelworkers cancelled and withdrew the charter of Local 4076. On the other hand, the agreement between Woodings-Verona and the United Steelworkers which expired on October 1, 1968, was succeeded by an agreement covering the period from October 10, 1968 to August 31, 1972.

 The plaintiff to this action is an association of the transferred Klein Logan employees. *fn5" The contract "between an employer and a labor organization" which the plaintiff alleges a violation of is, particularly, the arbitration award of June 19, 1968, as it grew out of the then obtaining labor agreements between Klein Logan and the United Steelworkers and Woodings-Verona and the United Steelworkers. *fn6" The plaintiff construed the award as providing that although Klein Logan employees were not entitled, by virtue of their seniority, to "bump" into positions at Woodings-Verona's Oakmont plant, they were entitled, if and when they were offered and accepted employment with Woodings-Verona, to totally "dovetail" their seniority with the seniority of the incumbent Woodings-Verona employees. *fn7" Mr. Hart, however, interpreted the award differently. He read it to provide that, with respect to Woodings-Verona employees on the payroll at the time of the purchase, the seniority of the transferred Klein Logan employees would be fixed at November 20, 1967. Further, he read it to provide that (1) with respect to the transferred Klein Logan employees inter se, their seniority would be transplanted unchanged, and (2) with respect to employees hired by Woodings-Verona after November 20, 1967, their seniority would be subject to that of all the transferred Klein Logan employees. Not surprisingly, the defendants implemented Mr. Hart's interpretation, and in turn the plaintiff instituted this action.

 Preliminarily, the defendants attack the judicial cognizability of this action. The defendants argue that it focuses primarily on a breach of the duty of fair representation, rather than a breach of a labor agreement, and therefore the jurisdiction of the federal courts is preempted by the jurisdiction of the National Labor Relations Board. The defendants also argue that the plaintiff has failed to exhaust (1) intra-union grievance procedures, and (2) contractual grievance procedures, both of which it is suggested, are indispensable prerequisites to the maintenance of this action.

 Assuming that this action is principally for a breach of the duty of fair representation, the defendants' first contention was squarely rejected in Vaca v. Sipes, 386 U.S. 171, 17 L. Ed. 2d 842, 87 S. Ct. 903 (1967). There the Court held that,

". . . the unique role played by the duty of fair representation doctrine in the scheme of federal labor laws, and its important relationship to the judicial enforcement of collective bargaining agreements . . . render the . . . pre-emption doctrine inapplicable."

 Further, that an action by an employee (or a group of employees) against both his employer and his union alleging breaches of both a labor contract and the duty of fair representation is within the ambit of § 301 (a) was settled in Humphrey v. Moore, 375 U.S. 335, 11 L. Ed. 2d 370, 84 S. Ct. 363 (1964). *fn8"

 The defendants' second contentions are equally unobstructive to the jurisdiction of this court. With respect to the defendant unions' contention that the doctrine requiring the exhaustion by union members of intra-union charge procedures prior to proceeding in the courts has not been satisfied, we look initially to Section 101(a)(4) of the Labor Management Reporting and Disclosure Act, 29 U.S.C. § 411(a)(4). That section provides that a labor organization may not limit the right of any member to institute an action in any court, except that a member may be required to exhaust reasonable internal hearing procedures (not to exceed four months in duration) before resorting to the courts to seek redress of an internal grievance. *fn9" In Giordani v. Upholsterers International Union of North America, 403 F.2d 85 (2d Cir. 1968), it was deemed to be,

". . . beyond question that the statutory exhaustion requirement § 101(a)(4) does not give the union authority to compel its members to pursue internal remedies before resorting to the courts, but rather preserves the discretionary exhaustion doctrine as it had been Judaically developed, subject to the four-month limitation."

 See also NLRB v. Industrial Union of Marine & Shipbuilding Workers of America, AFL-CIO, 391 U.S. 418, 20 L. Ed. 2d 706, 88 S. Ct. 1717 (1968); Fulton Lodge No. 2 of the International Association of Machinists and Aerospace Workers, AFL-CIO v. Nix, 415 F.2d 212 (5th Cir. 1969); and Detroy v. American Guild of Variety Artists, 286 F.2d 75 (2d Cir. 1961).

 This principle was thoroughly reviewed in Brady v. Trans World Airlines, Inc., 401 F.2d 87 (3rd Cir. 1968), cert. denied, 393 U.S. 1048, 89 S. Ct. 680, 21 L. Ed. 2d 691 (1969). In Brady, the plaintiff, because he was delinquent in his dues, was expelled from his union, and consequently, at the instance of his union, from his employment for violating the union security provision of the collective bargaining agreement. To the action which he brought against (1) his employer for wrongful discharge and (2) his union for breach of the duty of fair representation, the defendant union asserted as a bar, his failure to exhaust intra-union grievance procedures. Distinguishing between the two prongs of the action, the Court held that the doctrine of exhaustion of internal union remedies was inapplicable as against the employer, reasoning that since that prong of the complaint centered on the employment relationship rather than the union relationship, the internal union procedures could not possibly afford the plaintiff a remedy. As against the union, however, the Court held that,

"It has been the general rule, and the rule of this circuit, that before a suit against a union for breach of its duty of fair representation may be brought in the courts, the member must first exhaust the available internal union remedies, or show an adequate reason for failing to do so." *fn10"

 To apply the principles of Brady, it becomes necessary to similarly distinguish between the claims of this action. The complaint states two causes of action, one against all of the defendants for breach of a labor contract, and one against only the defendant unions for breach of the duty of fair representation. Initially, all of the defendants argue that even if their implementation of Mr. Hart's interpretation of the arbitration award amounted to breaches respectively, of the labor agreement and the duty of fair representation, that the expirations of the agreements make this action moot.

 In our view, the plaintiff seeks by this action (1) primarily to compel the restructuring of the present seniority at Local 1465 to comport with the arbitration award of Myron Joseph, and (2) only secondarily to recover damages for the wages lost by its members as a result of their inaccessibility to extra and higher paying jobs. With respect to the claim for damages, we think that since "Local 4076" as an unincorporated association has suffered no damages, it may recover none. Nor do we think it may recover damages on behalf of its members since we have here recognized it as a jural entity solely for the purpose of prosecuting the common complaints of its members, and damages are individual claims. Removing the request for damages, then, we are left with the request to restructure the seniority list of Local 1465, a request which concerns only the defendant unions. In this context, the fact that the agreements underlying the arbitration award have expired serves not to make this action moot, but to crystallize the issue with which we are faced -- whether or not the United Steelworkers and Local 1465 breached their duties to fairly represent their members in the negotiation of the agreement which succeeded the expired contracts, that of October 10, 1968, in providing for seniority at Woodings-Verona's Oakmont plant. Our focus thus sharpened, we think it appropriate to apply the rule of Brady which relates to actions against a union for a breach of the duty of fair representation. And since it is not contended that the plaintiff exhausted the available internal union remedies, the question is whether or not it has shown "an adequate reason for failing to do so".

 The internal union remedies available to the members of former Local 4076 are presumably embodied in the Constitution of the International Union, United Steelworkers of America, AFL-CIO-CLC. We are unable to discern from that document, however, what remedies or procedures were available to the plaintiff's members to have Mr. Hart's interpretation reviewed. Article XIII of the Constitution, which deals with "Trials of Members and Local Union Officers", provides that charges against a member or a local union officer must be first submitted, in writing, to the local union of which the individual charged is a member or an officer. While Mr. Hart is probably a member of a local union, whether or not he is subject to a trial at the local level is questionable. Moreover, the members of former Local 4076 did not seek to have anyone "tried", found "guilty", or penalized as Article XIII contemplates. They were not concerned with retribution; they were concerned only with appealing Mr. Hart's interpretation. Article IV, Sections 1 and 22, taken together, provide that the International Executive Board shall have the power to remove a District Director for, inter alia, "maladministration". Again, however, the plaintiff sought to remove no one from office. The most pertinent portion of the Constitution appears to be Article IV, Section 24. That section provides that the International Executive Board shall have the power to decide "all appeals made to it". This would seem to be the section that affords the plaintiff the appropriate internal remedies. Neither the nature nor the scope of the allowable "appeals" is circumscribed, and other than Articles ...

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