The opinion of the court was delivered by: SIMMONS
This action was originally filed on July 23, 1976, as a class action by eleven Western Pennsylvania coal haulers against the Defendants United Mine Workers of America [UMWA], District 2 of the United Mine Workers of America, and Local 1600 of the United Mine Workers of America [hereinafter collectively referred to as "Defendant" or "Defendant Union"]. The Plaintiffs sought to recover damages resulting from the Union's attempts to force them to sign the 1974 National Bituminous Coal Wage Agreement [hereinafter referred to as the "NBCWA" or the "Wage Agreement"] and to prevent the Bituminous Coal Operator's Association [hereinafter "BCOA"] from using non-signatory haulers to transport coal. Count One of the Complaint, brought under section 303 of the National Labor Relations Act (NLRA), 29 U.S.C. § 187, alleged that the Union violated sections 8(b)(4) and 8(e) of the Labor Act, 29 U.S.C. §§ 158(b)(4) and (e), because Article II(g) of the 1974 Wage Agreement contained an unlawful hot cargo clause.
Specifically, the Plaintiffs claimed that the Defendant Union engaged in an illegal strike to compel them to sign a collective bargaining agreement with the United Mine Workers of America, by using a hot cargo clause in the contract with the BCOA, which prevented the BCOA from subcontracting with coal haulers, such as Plaintiffs, who failed to sign the 1974 Wage Agreement. Plaintiffs alleged that the use of Article II(g) by the Union caused a secondary boycott of the coal haulers. Counts Two and Three of the Complaint charged that the Union violated the federal antitrust laws.
On September 13, 1977, the above-captioned case was certified as a class action under Rule 23(b)(2) and 23(b)(3) of the Federal Rules of Civil Procedure, and the class was defined to include: "All coal haulers whose principal place of business was or is now located in Western Pennsylvania who, at any time from on or about November 1, 1974, have been engaged in the business of coal hauling from points in Western Pennsylvania to locations in Western Pennsylvania and other locations in the United States. Feather v. United Mine Workers of America, 494 F. Supp. 701, 704 (W.D. Pa. 1980).
This case was originally assigned to the late Judge William Knox of this Court, who conducted a bench trial on the liability issues, and in an opinion dated June 27, 1980, found the Union to be liable as to Count 1, but found them to be exempt from liability as to Counts 2 and 3. The matter was then referred to the United States Magistrate for a calculation of damages. The case was reassigned to this Judge after the death of Judge Knox, and this Judge adopted the recommendations of the Magistrate with respect to damages in an Order dated June 23, 1982. Both sides then appealed, and on June 30, 1983, the United States Court of Appeals for the Third Circuit affirmed the district court's conclusion that the Union was exempt from liability under the antitrust laws, and also affirmed the Union's section 8(b)(4) liability for the period of the BCOA strike, but vacated the damage award and remanded for additional findings of fact on the issue of causation.
Our affirmance of the Union's section 8(b)(4) liability for the period of the BCOA strike does not mandate a conclusion that the plaintiffs are entitled to recover damages under section 303 for all losses that might be attributable to that strike, regardless of causation. Section 303(a) makes it unlawful for a labor union to violate section 8(b)(4), 29 U.S.C. § 187(a). See Local 20, Teamsters Union v. Morton, 377 U.S. 252, 84 S. Ct. 1253, 12 L. Ed. 2d 280 (1964). When a union strikes, and one purpose of that strike is to obtain or enforce a hot cargo agreement, sections 8(b)(4) and 303(a) are violated. National Labor Relations Board v. Denver Building & Construction Trades Council, 341 U.S. 675, 71 S. Ct. 943, 95 L. Ed. 1284 (1951). In a companion case to [ Denver Building & Construction ], the Court stressed that "it was sufficient that an objective of the picketing, although not necessarily the only objective of the picketing, was to force [the employer] to . . . cease doing business with [another employee]. " 341 U.S. at 700, 71 S. Ct. at 957. In the case before us, Article II(g) of the 1974 NBCWA was a hot cargo clause, and one of the objectives of the BCOA strike was to seek agreement on that clause. Therefore, by engaging in that strike, the UMWA violated section 303(a).
Feather v. United Mine Workers of America, 711 F.2d 530, 537 (3d Cir. 1983).
The Court of Appeals went on to say with respect to the issue of the causation requirement of section 303(b):
To receive a damage award under [section 303], the plaintiffs in this case must demonstrate not that the unlawful hot cargo clause was an object of the BCOA strike, but that it was a substantial factor in or materially contributed to the Union's decision to call and maintain that strike. The mere fact that the agreement the Union sought to obtain by striking contained a hot cargo clause is not enough, without more, to support a finding that the clause was a substantial factor.
The prior opinions in this case have not resolved this issue. The district court's liability opinion is confined to a discussion of sections 8(b)(4) and 303(a). It contains no determination of the proximate cause issue presented by the section 303(b) damage claim.
The Court directed that the matter be considered de novo, and that additional evidence be taken if necessary. The parties have deposed Richard Banks, who had previously testified as a witness for the Defendants at the non jury trial on liability. The issue presently before this Court is whether Article II(g) of the 1974 NBCWA was a substantial factor in, or materially contributed to the Union's decision to call and maintain the BCOA strike.
The clause in the 1974 Wage Agreement which was previously found by the district court to be an illegal hot cargo clause provides as follows:
Article II: Scope and Coverage
Section (g) -- Contracting and Subcontracting.
(1) Transportation of Coal -- The transportation of coal as defined in paragraph (a) may be contracted out only to a contractor employing members of the UMWA under this Agreement and only where contracting out such work is consistent with prior practice and custom of the employer.
(2) Repair and Maintenance Work -- Repair and maintenance work customarily performed by classified employees at the mine or central shop shall not be contracted out except (a) where the work is being performed by a manufacturer or supplier under warranty or (b) where the employer does not have the available equipment or regular employees with necessary skills available to perform the work at the mine or central shop, provided, however, that the work at the mine or central shop shall be performed by UMWA members to the extent and in the manner permitted by law.
The relevant statutory provisions are contained in 29 U.S.C. §§ 158 and 187. 29 U.S.C. § 158 provides in relevant part:
4(i) to engage in, or to induce or encourage any individual employed by any person engaged in commerce or in an industry affecting commerce to engage in, a strike or a refusal in the course of his employment to use, manufacture, process, transport, or otherwise handle or work on any goods, articles, materials, or commodities or to perform any services; or (ii) to threaten, coerce, or restrain any person engaged in commerce or in an industry affecting commerce, where in either case an object thereof is --
(A) forcing or requiring any employer or self-employed person to join any labor or employer organization or to enter into any agreement which is prohibited by section 8(e) [subsec. (e) of this section];
(B) forcing or requiring any person to cease using, selling, handling, transporting, or otherwise dealing in the products of any other producer, processor, or manufacturer, or to cease doing business with any other person, or forcing or requiring any other employer to recognize or bargain with a labor organization as the representative of his employees unless such labor organization has been certified as the representative of such employees under the provisions of section 9 [ 29 U.S.C. § 159]: Provided, That nothing contained in this clause (B) shall be construed to make unlawful, where not otherwise unlawful, any primary strike or primary picketing;
29 U.S.C. § 187 provides:
§ 187. Unlawful activities of labor union -- Right of action for injury.
(a) It shall be unlawful, for the purpose of this section only, in an industry or activity affecting commerce, for any labor organization to engage in any activity or conduct defined as an unfair labor practice in section 8(b)(4) of the National Labor Relations Act, as amended [ 29 U.S.C. § 158(b)(4)].
(b) Whoever shall be injured in his business or property by reason or [of] any violation of subsection (a) may sue therefor in any district court of the United States subject to the limitations and provisions of section 301 hereof [ 29 U.S.C. § 185] without respect to the amount in controversy, or in any other court having jurisdiction of the parties, and shall recover the damages by him sustained and the cost of the suit.
In its June 30, 1983 opinion, the Third Circuit determined that the prior district court opinion contained no determination of the proximate cause issue presented by the section 303(b) damage claim, vacated the damage award, and then remanded the case to this Court for a specific finding on the issue of causation during the period of the BCOA strike and a determination of the agency question with respect to the Magistrate's recommendation relating to the H & H damage award.
Section 303(b) of the National Labor Relations Act requires that there be a causal nexus between the unlawful secondary activity and the injury suffered by the Plaintiff. The Third Circuit, in Feather v. United Mine Workers, supra, has determined that the causal requirement as articulated by the Ninth Circuit in Mead v. Retail Clerks International Association, 523 F.2d 1371 (9th Cir. 1975), is the proper standard to be used in determining the proximate cause issue presented by a section 303(b) damage claim. In Mead, supra, the Union had proposed that an agreement between the Union and grocery stores contain a "demonstrator clause" which provided that food demonstrators who distributed product samples to customers must be covered by the collective bargaining agreement whether or not the demonstrators were employed by the grocery store or by the supplier of the product being promoted. When the grocery store owner rejected the proposed contract and objected to the demonstrator clause as well as the wage, health and welfare benefits and pension provisions, the Union called a strike and began picketing.
The Mead Court held that under section 303, injury occurs "by reason of" particular unlawful conduct if that conduct materially contributes to the injury or is a substantial factor in bringing it about, 523 F.2d at 1376, and stated as follows:
Nor were the Meads required to establish the fact of resultant injury to their business with certainty. "Regarding the quantum of proof required to establish the fact of damage, the rule is that the plaintiff is required to establish with reasonable probability the existence of some causal connection between the defendant's wrongful act and some loss of anticipated revenue." [Citations omitted]. It is sufficient if the evidence "supported a just and reasonable inference that [the Mead's] were damaged by [the Union's] action." Bigelow v. RKO Radio Pictures, Inc., 327 U.S. 251, 266, 66 S. Ct. 574, 580, 90 L. Ed. 652 (1946).
III. REVIEW OF THE EVIDENCE
A thorough review of the record indicates that prior to 1974 the NBCWA did not contain a work jurisdiction clause, and that work jurisdiction was a prime concern of the Defendants throughout the history of the negotiations between the UMWA and the BCOA. The two issues of work jurisdiction and subcontracting were treated as similar objectives by the UMWA throughout the negotiations, and the record clearly indicates that the UMWA strongly bargained for Article II(g) so that it could expand both the subject matter jurisdiction of the Union as well as the number of its members. When the UMWA was unable to obtain what it considered to be an acceptable form of Article II(g) prior to the expiration of the 1971 Wage Agreement, the strike against the BCOA began. This Court's review of the record reveals the following relevant information with respect to the history of the negotiations between the parties.
In 1973 and 1974, a series of district collective bargaining conferences was held to familiarize district representatives with the 1971 Wage Agreement, and to solicit information, feedback and recommendations for the negotiation of the 1974 collective bargaining agreement. Tom Bethell, a UMWA official, submitted a confidential memorandum to the UMWA on June 14, 1974, in which he reported on the concerns that had been expressed to him in the district collective bargaining conferences. With respect to non-economic concerns, Mr. Bethell reported as follows:
In non-economic areas, the greatest concerns not suprisingly focus on seniority and the grievance procedure. Again, detailed summaries available next week will be more helpful than a simplification here; however, there are generally very strong feelings on the need to determine seniority on length of service alone, with no continuation of "qualifications;" district-wide or company-wide seniority; elimination of subcontracting, especially maintenance and contract haulage; . . .
P.Ex. 6, p. 2. Thus, as early as June of 1974, the elimination of subcontracting was seen as an important objective of the collective bargaining process.
The UMWA issued its proposals to the Bituminous Coal Industry prior to the 1974 collective bargaining sessions, which proposals constitute Plaintiffs' Exhibit 8. In the Scope and Coverage section of that proposal, the UMWA stated:
With the possible exception of Article XIII (Seniority), there is probably no other article in the current agreement which has caused more problems, more disputes, more work stoppages and more rank-and-file discontent than Article II. It is a literal mine field of explosive issues. It is confusing to the miner and to mine management. It says too much in some sections, too little in others. It is out-of-date in some areas, and is not designed to remedy critical issues which regularly arise.
With respect to subleasing and contracting, the proposal stated:
During the term of the present agreement, the jurisdictional rights of the UMWA have repeatedly been infringed upon and undermined by the subcontracting of work. Because of serious problems which may result in any attempt to limit subcontracting, other than to impose an absolute ban on subcontracting, the UMWA proposes that subcontracting of unit work be absolutely prohibited. Furthermore, the Union reserves the right to resort to free collective bargaining when any employer attempts to evade the prohibition on subcontracting.
The UMWA also sought to expand its work jurisdiction:
Section (f) is entirely inadequate to cover the existing jurisdiction of the UMWA. It does not deal with problems which have regularly recurred during the term of the 1971 agreement such as the trucking of coal from mine sites, the removal of overburden and reclamation of strip sites and the maintenance of mine roads. This section should be redrafted in its entirety to make it clear that all work related to or incident to the removal of coal from the earth, its processing, the hauling of coal from the mine site, the removal of coal waste and maintenance of gob piles, the restoration and reclamation of the mine site, the maintenance of mine roads, and all repair and maintenance work in and around the mine or at a central repair shop shall be performed solely by members of the UMWA employed by the mine owner or operator.
It is evident that from the beginning of the negotiations the UMWA wished to expand its work jurisdiction and eliminate all subcontracting by non-union personnel. The district conferences had previously recommended that the jurisdiction clause be amended to cover independent truckers. (P.Ex. 7, 9). At a September 10, 1974 bargaining session, William Hartman of the BCOA brought up the question of subleasing, subcontracting and work jurisdiction. The notes of this main table session reflect the following exchange between William Hartman (WH), Guy Farmer (GF), and Walter Wallace (WW) of the BCOA, and Rick Bank (RB) and Chip Yablonski (JY) of the UMWA:
WH: Subleasing and Subcontracting and Work Jurisdiction are pretty much the same thing. We've contracted trucking historically. How would ...