International L. Garment Work. Un. v. Donnelly G. Co.

Decision Date30 April 1945
Docket NumberNo. 12931.,12931.
Citation147 F.2d 246
PartiesINTERNATIONAL LADIES' GARMENT WORKERS' UNION et al. v. DONNELLY GARMENT CO. et al.
CourtU.S. Court of Appeals — Eighth Circuit

COPYRIGHT MATERIAL OMITTED

Charles A. Horsky, of Washington, D. C. (Emil Schlesinger, of New York City, Clif. Langsdale, of Kansas City., Mo., and Amy Ruth Mahin and Covington, Burling, Rublee, Acheson & Shorb, all of Washington, D. C., on the brief), for appellants.

William S. Hogsett, of Kansas City, Mo. (R. J. Ingraham and Burr S. Stottle, both of Kansas City, Mo., on the brief), for appellees Donnelly Garment Co., Donnelly Garment Sales Co., and Central Surety & Insurance Co.

Frank E. Tyler, of Kansas City, Mo. (Gossett, Ellis, Dietrich & Tyler, of Kansas City, Mo., on the brief), for appellee Donnelly Garment Workers' Union.

Before SANBORN, THOMAS, and RIDDICK, Circuit Judges.

Writ of Certiorari Denied April 30, 1945. See 65 S.Ct. 1088.

RIDDICK, Circuit Judge.

This action began with a motion of the defendants in the case of Donnelly Garment Company et al. v. International Ladies' Garment Workers' Union et al. for a hearing to assess damages and expenses caused defendants by the erroneous issue and continuance of certain injunctive orders issued by the district court in the case mentioned, and for a decree against the plaintiffs, the interveners, and the surety on their injunction bonds for the amount of defendants' damages and expenses determined by the court. Under the order of the court made upon the motion, the defendants filed a bill of complaint setting forth their claims; the plaintiffs, interveners, and the surety answered; and the matter was heard on evidence before the court which awarded judgment in favor of defendants in the sum of $2,000. The defendants have appealed. In this opinion they will be designated the defendants, and the appellees will be referred to as the plaintiffs.

In order to understand the issue arising on this appeal, it is necessary to state in some detail the history of the litigation in which the restraining orders and injunctions were issued.

On July 5, 1937, the Donnelly Garment Company, a corporation engaged in the manufacture of women's garments in Kansas City, Missouri, and the Donnelly Sales Corporation, a subsidiary handling the sales of the garment company's products, brought an action in the United States District Court for the Western District of Missouri to enjoin the International Ladies' Garment Workers' Union, its officers and agents, and a number of its employees from picketing, boycotting, and otherwise interfering with plaintiffs' business, employees, and customers, in the furtherance of a conspiracy in violation of the Sherman Anti-Trust Act, 15 U.S.C.A. § 1 et seq., 15 note. Among the individual defendants were residents of Missouri and of other States. The jurisdiction of the Federal court was grounded exclusively upon the Sherman Act.

On the filing of the complaint the district court issued a temporary restraining order, returnable in five days. The court required and the plaintiffs gave a bond on the restraining order in the sum of $2,000, conditioned to pay defendants "such costs and damages as may be incurred or suffered by reason of the wrongful issuance of said restraining order or injunction should it be thereafter dissolved or it be decided that said temporary restraining order was wrongfully obtained."

On the return day the defendants moved to dismiss the bill and vacate the restraining order. The ground for this motion was that the controversy alleged in the bill involved a labor dispute within the meaning of the Norris-LaGuardia Act, 29 U.S.C.A. § 101 et seq., and that, by virtue of that Act, a Federal court was without jurisdiction to issue a restraining order or a temporary or permanent injunction on the allegations of the complaint. On August 13, 1937, defendants' motion was denied, the district court saying in its opinion (Donnelly Garment Co. v. International Ladies' Garment Workers' Union, D.C., 20 F.Supp. 767, 768) that the defendants, conceding that the court formerly had jurisdiction of the action set out in the complaint, contended that its jurisdiction had been taken away by the Norris-LaGuardia Act. The temporary restraining order was by the court continued in effect with the consent of the parties until the ruling on plaintiffs' application for a temporary injunction.

After these proceedings the Donnelly Garment Workers' Union, an organization of the plaintiffs' employees, was permitted to intervene in the case, alleging that it included in its membership all of the employees of the Donnelly Garment Company, by which it had been recognized as the agency for collective bargaining between the company and its employees, and that contracts between it and the plaintiff company concerning rates of pay and hours and conditions of work had been made. The intervener joined in the prayer of the bill of complaint for an injunction restraining the defendants from the acts charged in the complaint, and further asked that the plaintiffs be enjoined from abrogating their contracts with the intervener and from attempting to coerce or compel the members of the intervener organization to join the International Union. The intervener denied that a labor dispute was involved in the controversy set forth in the original bill, asserted that neither the Norris-LaGuardia Act nor the National Labor Relations Act, 29 U.S.C.A. § 151 et seq., was applicable on the issues involved, and alleged the unconstitutionality of both Acts if interpreted to apply in the situation before the court.

Because of the allegations in the intervening petition concerning the unconstitutionality of the Norris-LaGuardia Act and the National Labor Relations Act, defendants conceived the idea that an injunction was sought against the operation of an Act of Congress within the Act of August 24, 1937, 50 Stat. 752, 28 U.S.C.A. § 380a. Accordingly, on their suggestion, a three-judge court was empaneled, and plaintiffs' application for a temporary injunction and defendants' motion to dismiss came on for hearing before that court. The issue was the same as that presented to the district court on the temporary restraining order, the court stating in its opinion (21 F.Supp. 807, 809) that the only ground of defense relied upon by defendants was the contention that the Norris-LaGuardia Act applied and deprived the district court of jurisdiction. This contention the court overruled. The temporary injunction was granted effective December 31, 1937. The court required and the plaintiffs gave a bond in the sum of $10,000, conditioned to pay all "such costs and damages as may be incurred or suffered by any party who may be found to have been wrongfully enjoined or restrained by said temporary injunction if it be finally held that said temporary injunction was improvidently granted."

From the above order defendants took a direct appeal to the Supreme Court which held that the case was not one for a three-judge court within the Act of August 24, 1937; and, by its order of May 16, 1938, dismissed the appeal at the cost of the defendants, vacated the temporary injunction, and remanded the case for further proceedings in the district court, 304 U.S. 243, 251, 58 S.Ct. 875, 82 L.Ed. 1316.

Plaintiffs amended their bill by alleging facts which, in their belief, sustained the jurisdiction of the district court in the event it should be determined that the controversy involved a labor dispute as defined by the Norris-LaGuardia Act, reserving their contention that the Act was not applicable and that no labor dispute was involved. The defendants renewed their motion to dismiss on the same ground as that advanced at previous hearings. The district court reached the conclusion that the controversy between the parties involved a labor dispute, and that the plaintiffs' bill failed to allege that plaintiffs had made every reasonable effort to settle the dispute, the Norris-LaGuardia Act requiring such an effort as a condition precedent to the granting of a restraining order, and that for this reason the complaint should be dismissed and the temporary restraining order vacated (23 F.Supp. 998, 1001). On motion of the plaintiffs, the district court on July 18, 1938, resurrected the original restraining order, modified it in certain particulars, and, as modified, continued it in effect pending an appeal, on condition that the plaintiffs execute a bond to defendants in the sum of $25,000. This bond, as required and approved by the court, was conditioned as follows:

"The condition of the above obligation is such that, whereas, the temporary restraining order heretofore issued in this cause is continued as modified on this 18th day of July 1938, pending appeal of this cause, now, therefore, if the obligors and each of them shall well and truly pay all costs, damages and expenses, including attorneys' fees, suffered by defendants or any of them, by reason of the improvident or erroneous issuance or continuance of said restraining order, then this bond shall be void, otherwise to remain in full force and effect."

On the appeal this court reversed. In its opinion, 99 F.2d 309, 314, the court pointed out that at the time this action came on for hearing before the three-judge court, the question whether a labor dispute was involved was a debatable one. It held, however, that the question had been settled by decisions of the Supreme Court handed down after the hearing before the three-judge court, and that a labor dispute was involved in the controversy within the meaning of the Norris-LaGuardia Act. It overruled the action of the district court in disposing of the case upon the pleadings, holding that the question whether the plaintiffs failed to use every reasonable effort to settle the labor dispute was a question of fact to be determined from the evidence adduced at a hearing on the...

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