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United States Steel Corp. v. United Mine Workers of America

decided: February 3, 1972.


Seitz, Chief Judge, Kalodner and Gibbons, Circuit Judges. Kalodner, C. J., concurring in part and dissenting in part.

Author: Gibbons


Appellants, labor unions and individual union members, appeal from the order of the district court denying their motion for costs, expenses, and attorney's fees. United States Steel Corp. v. United Mine Workers of America, 317 F. Supp. 1070 (W.D. Pa. 1970). The dispute had its genesis in actions filed by the appellees, United States Steel Corporation, Jones & Laughlin Steel Corporation, Bethlehem Mines Corporation and Republic Steel Corporation seeking injunctions against work stoppages which they alleged were in violation of union contracts containing "Settlement of Local and District Disputes" grievance-arbitration procedures. The steel companies contended that by virtue of § 301 of the Labor-Management Relations Act of 1947, 29 U.S.C. § 185 (1971), the work stoppages should be enjoined pending resolution of the underlying disputes through the contract grievance-arbitration procedures. After a two-day hearing the district court entered an order in each case granting a preliminary injunction. Each order contained the language:

"Bond in the amount of $1,000.00 has been approved and filed with the Court by plaintiff."

A separate bond, identical in form, was filed by each plaintiff. The condition of the bond was in each case as follows:

" Whereas, plaintiff has applied for a Preliminary Injunction against defendants, enjoining and restraining them from the commission of certain acts, as more particularly described in the Complaint; Now, the condition of this obligation is such, that the plaintiff shall be liable to the defendants for such costs and damages, not exceeding the sum of $1,000.00, as defendants or any other person may sustain by reason of the Preliminary Injunction, if the Court finally decides that plaintiff is not entitled thereto."

Neither the orders granting preliminary injunction nor the bond in any case made reference to the authority under which the court required that the bond be posted. The record discloses no opportunity for the defendants to examine the bond prior to its approval and filing.

The applications for preliminary injunctions were strenuously opposed by the defendants who contended that the work stoppage did not fall within the coverage of the contract grievance-arbitration provisions. When the orders were entered defendants promptly appealed. On their motion we summarily reversed. Bethlehem Mines Corporation v. United Mine Workers of America, No. 19,040 (3rd Cir., filed July 2, 1970). That reversal was on the ground that the district court because of an erroneous view of the applicable law had effectively denied the parties the opportunity to develop their respective positions in the abbreviated hearing which it conducted. The preliminary injunction was, therefore, improvidently granted. We remanded "without prejudice to a request for a hearing de novo on the application for a preliminary injunction." The order on remand specified, "Each side to bear its own costs."

After remand the plaintiffs renewed their request for a preliminary injunction and the district court set the matter down for a de novo hearing commencing July 9, 1970. Instead of proceeding with the hearing, however, the parties with the approval of the district court entered into a stipulation providing:

"At the hearing, counsel for the respective defendants have represented to the Court that, to their knowledge, no picketing, work stoppage or strike exists at present and none is known to be anticipated in the immediate future. Also, counsel for the respective parties have agreed to an indefinite continuance of the hearing upon the oral stipulation that plaintiff, in good faith, will utilize its best efforts to comply with the Federal Coal Mine Health and Safety Act of 1969 and that counsel for the respective defendants, based upon the conditions in the mines as they are known to exist at present, will counsel the officers and membership of defendant-unions to refrain from any work stoppage or picketing at plaintiffs' mines.

Now, Therefore, this 10th day of July, 1970, in accordance with the representations and stipulations of counsel, it is hereby Ordered that the hearing upon plaintiffs' application for preliminary injunction be continued until further notice by the Court."

The effect of this stipulation, although it purported to continue the hearing on plaintiffs' application for a preliminary injunction, was to end the lawsuit for all practical purposes. By then the work stoppages complained of had ceased.

On August 14, 1970 the defendants moved for the award of reasonable costs, expenses and attorneys' fees. This claim was based upon § 7 of the Norris-LaGuardia Act, 29 U.S.C. § 107 (1971) which in relevant part provides:

"No temporary restraining order or temporary injunction shall be issued except on condition that complainant shall first file an undertaking with adequate security in an amount to be fixed by the court sufficient to recompense those enjoined for any loss, expense, or damage caused by the improvident or erroneous issuance of such order or injunction, including all reasonable costs (together with a reasonable attorney's fee) and expense of defense against the order or against the granting of any injunctive relief sought in the same proceeding and subsequently denied by the court.

The undertaking mentioned in this section shall be understood to signify an agreement entered into by the complainant and the surety upon which a decree may be rendered in the same suit or proceeding against said complainant and surety, upon a hearing to assess damages of which hearing complainant and surety shall have reasonable notice, the said complainant and surety submitting themselves to the jurisdiction of the court for that purpose. But nothing in this section contained shall deprive any party having a claim or cause of action under or upon such undertaking from electing to pursue his ordinary remedy by suit at law or in equity."

At the hearing on this motion the parties stipulated the amount of expenses incurred and the reasonable value of legal services rendered in opposing the preliminary injunctions and in procuring their reversal by this court.*fn1 The stipulated fees and expenses exceed $11,350.00. The four bonds total $4,000.00. The district court denied the motion in its entirety "without prejudice to [defendants'] right to re-submit similar motions should the outcome of the proceedings warrant the same." This appeal followed.

The appellees moved before this court to dismiss the appeal on the ground that it was interlocutory. Another panel denied that motion without opinion, apparently on the ground that the order appealed from, although in form interlocutory, was in practical effect final on the issue here presented since no further proceedings would take place in the district court and was therefore appealable under the "collateral order" doctrine. See Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 93 L. Ed. 1528, 69 S. Ct. 1221 (1949); Greene v. Singer Co., 509 F.2d 750 (3rd Cir. 1971). Thus we must treat the appeal as a final decision denying defendants' motion for costs, expenses and attorneys' fees.

Since the reasonableness of the requested amounts has been stipulated the only question before us is whether on legal grounds the district court properly refused to make an award. Appellees advance several legal contentions in support of that conclusion.

First, appellees contend that because they brought suit under § 301 of the Labor-Management Relations Act the procedural provisions of § 7 of the Norris-LaGuardia Act are inapplicable. They urge that there is no warrant in law outside § 7 for the award of counsel fees incurred in setting aside an injunction improvidently issued. As authority for the proposition that § 7 is inapplicable, appellees cite Boys Markets, Inc. v. Local 770, Retail Clerks, 398 U.S. 235, 26 L. Ed. 2d 199, 90 S. Ct. 1583 (1970).

Appellees read far too much into the Boys Markets opinion. In expressly overruling its earlier decision in Sinclair Refining Co. v. Atkinson, 370 U.S. 195, 8 L. Ed. 2d 440, 82 S. Ct. 1328 (1962), and in approving the analysis of the Sinclair dissent, the Supreme Court worked out a careful and narrow accommodation between the earlier Norris-LaGuardia Act and the later Labor-Management Relations Act. It held only that the express prohibitions against certain specific injunctions contained in § 4 of Norris-LaGuardia, 29 U.S.C. § 104, were deemed not to bar injunctions necessary to accomplish the purposes of the Labor-Management Relations Act through contract arbitration. The Court very carefully in Part V of the opinion, 398 U.S. at 253-55, made clear that it was dealing only with the prohibitions of § 4 of Norris-LaGuardia, and then only in cases where the court first holds that a strike is over a grievance which both parties are contractually bound to arbitrate. The opinion says nothing about the procedural steps which must be taken in making that determination or about the safeguards which must surround the issuance of a preliminary injunction.

The thrust of § 4 of the Norris-LaGuardia Act is quite different from that of § 7. The former is a list of injunctive orders which the federal district courts are flatly prohibited from entering. The latter is essentially a procedural section. It prohibits the entry of an injunction growing out of a labor dispute

"except after hearing the testimony of witnesses in open court (with opportunity for cross-examination) in support of the allegations of a complaint made under oath, and ...

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