The opinion of the court was delivered by: WILLIAM W. CALDWELL
Plaintiffs are members of a class of employees of the Commonwealth of Pennsylvania who do not belong to the state employees' union. The defendants are certain Commonwealth officials and Council 13, American Federation of State, County, and Municipal Employees, AFL-CIO ("Council 13" or the "Union"). This action is a constitutional challenge under Chicago Teachers Union v. Hudson, 475 US 292, 106 S. Ct. 1066, 89 LEd2d 232 (1986), to Pennsylvania legislation imposing a fair share fee on nonunion employees of the Commonwealth. See section 2 of Act No. 84 of 1988, 71 PS § 575 (Purdon 1990). The case is here on remand from the Third Circuit which affirmed some of our rulings and reversed others. See Hohe v Casey, 956 F.2d 399 (3d Cir 1992) (Hohe II). We are considering plaintiffs' motion for partial summary judgment and for a preliminary injunction. Our discussion assumes familiarity with the background to this litigation found in Hohe II.
Plaintiffs seek the following declaratory relief: (1) that section 2(g) of Act 84 facially violates the first and fourteenth amendments "because it requires nonunion public employees to submit challenges to the propriety of fair share fees to final and binding arbitration"; and (2) that the Commonwealth defendants and Council 13 violated the plaintiffs' first and fourteenth amendment rights by failing to provide the plaintiffs and other nonunion employees "notice that provides them with sufficient information to gauge the propriety of the portion of the fair share fee allocated to AFSCME Council 13's local affiliates." (plaintiff's motion at pp. 1-2).
The first request for declaratory relief is based on the Third Circuit's discussion in Hohe II of the plaintiffs' challenge to the facial validity of section 575(g). Subsection (g) provides that a challenge made under subsection (e) (1) "shall be resolved along with all similar challenges by an impartial arbitrator. . . ." Subsection (e)(1) permits challenges to the "propriety of the fair share fee." Concluding that the latter phrase includes challenges to the constitutionality of the fee, the Third Circuit held that subsection (g) was unconstitutional because it required nonunion employees to submit constitutional challenges to arbitration before seeking relief in court. It was therefore contrary to Patsy v Board of Regents, 457 US 496, 102 S. Ct. 2557, 73 LEd2d 172 (1982), which held that exhaustion of nonjudicial remedies was not required before filing a 42 USC § 1983 action.
The second request for declaratory relief is based on the Third Circuit's rejection of the "local presumption." Council 13 gives a certain portion of its dues to local unions affiliated with it. In calculating the portion of the locals' expenditures chargeable to nonunion employees, it assumed that the percentage of the locals' expenditures on chargeable expenses was at least as great as Council 13's.
We denied the plaintiffs' attack on the use of the presumption, see 695 F Supp 814, 818-19 (M D Pa 1988); 740 F Supp 1092, 1095-96 (M D Pa 1989), but the Third Circuit reversed, stating:
By making the assumption and offering no explanation or justification for it, Council 13 failed to provide nonmembers with any information identifying the major categories of expenses of the affiliated locals. . . .
We conclude that the notice sent by Council 13 left nonmembers in the dark about the portion of the fee attributable to chargeable expenses and placed them in the position of having to object to obtain the information needed to gauge the propriety of the fee. Thus, we believe that the notice sent by Council 13 failed to meet the constitutional standard set forth in Hudson.
The Commonwealth defendants have no objection to the declaratory relief sought by plaintiffs. Council 13, however, argues that the Third Circuit has already decided these issues and that the plaintiffs' attempt to obtain declaratory relief on remand violates the doctrine of the law of the case. In its view, the plaintiffs are improperly trying to relitigate issues already decided on appeal. We do not agree with this argument.
As noted by plaintiffs, they are not attempting to relitigate issues already decided by the appellate court. Rather, they are attempting to implement that court's decision by obtaining an order for declaratory relief consistent with the appellate rulings. Further, we must note here that the Third Circuit's mandate did not grant any affirmative relief; it merely remanded the action to us for further proceedings consistent with its opinion. Undoubtedly then, the plaintiffs are entitled to an order effectuating the victories they achieved on appeal.
We must disagree, however, with the language of the proposed declaration submitted by the plaintiffs in connection with subsection (g). Plaintiffs would have us declare that subsection unconstitutional because its second sentence requires objecting nonunion employees to submit their claims to binding arbitration. The Third Circuit, however, specifically refused to address this issue, concluding that the entire subsection was unconstitutional because the first sentence requires an objector to exhaust nonjudicial remedies. 956 F.2d at 409. We will issue a declaration consonant with the Third Circuit's holding.
Based on the Third Circuit's conclusion that the notice to nonunion employees did not provide them with sufficient information on the expenses of the locals, the plaintiffs also seek, pursuant to Fed R Civ P 65, a preliminary injunction against continued collection of the local portion of the fair share fee and restitution of the local portion already collected. The plaintiffs want this injunction to remain in effect until Council 13 adopts a notice that provides sufficient information to assess the propriety of the local portion of the fair share fee. The Union has used the same notice for all the years at issue in this litigation, beginning with the first fiscal year following passage of the Act, 1988-89, and subsequent fiscal years, 1989-90, 1990-91 and 1991-92.
Some additional facts important to the resolution of this part of the plaintiffs' motion are as follows. While the action was being litigated in this court previously, Council 13 had escrowed all of the fair share fees. However, subsequent to our determination that the procedures used essentially complied with Hudson, and after the arbitrator had approved the manner in which the fee had been calculated for 1988-89, the fees in escrow were released to Council 13. Thereafter, and prior to the Third Circuit's decision in Hohe II, only the fees of objecting nonunion employees were escrowed and then only until the arbitrator had ruled on the objections.
After the Third Circuit invalidated the local presumption, Council 13 calculated the total amount of the fair share fee attributable to the local portion of the fee and placed all past contributions based on the local share, totalling $ 2,205,624, in an escrow account. The Union has also begun putting into ...