170 F.3d 779 (7th Cir. 1999), 98-2659, International Oil, Chemical & Atomic Workers, Local 7-517 v. Uno-Ven Co.

Docket Nº:98-2659.
Citation:170 F.3d 779
Party Name:INTERNATIONAL OIL, CHEMICAL & ATOMIC WORKERS, LOCAL 7-517, and International Oil, Chemical & Atomic Workers, International, AFL-CIO, Plaintiffs-Appellants, v. UNO-VEN COMPANY, et al., Defendants-Appellees.
Case Date:March 19, 1999
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit

Page 779

170 F.3d 779 (7th Cir. 1999)


and International Oil, Chemical & Atomic Workers,

International, AFL-CIO, Plaintiffs-Appellants,


UNO-VEN COMPANY, et al., Defendants-Appellees.

No. 98-2659.

United States Court of Appeals, Seventh Circuit

March 19, 1999

Argued Dec. 4, 1998.

Page 780

Jeffrey B. Gilbert (argued), Johnson, Jones, Snelling & Gilbert, Chicago, IL, Reuben A. Guttman, Provost & Umphrey, Washington, DC, for Plaintiffs-Appellants.

Columbus R. Gangemi, Jr., Winston & Strawn, Chicago, IL, for Defendant-Appellee Uno-Ven Company.

Jeffrey R. Witham, Dewey Ballantine LLP, Los Angeles, CA, for Defendant-appellee Union Oil Company of California.

Julia A. Martin, Matkov, Salzman, Madoff & Gunn, Chicago, IL, for Defendants-Appellees Petroleos de Venezuelas, SA, PDV America, Incorporated and PDV Midwest Refining, L.L.C.

Paul W. Schroeder, Jones, Day, Reavis & Pogue, Chicago, IL, Stanley Weiner (argued), Jones, Day, Reavis & Pogue, Dallas, TX, for Defendant-Appellee Citgo Petroleum Corporation.

Before POSNER, Chief Judge, and EASTERBROOK and KANNE, Circuit Judges.

POSNER, Chief Judge.

This is a suit by a union (actually an international and one of its locals, but we can ignore that detail) against an employer and others, to enforce a collective bargaining contract. 29 U.S.C. § 185. The suit was dismissed on summary judgment, on the ground that none of the defendants is a party to the contract or otherwise bound by it. There are a couple of subsidiary issues that we take up later, but the principal issue is whether the employer, though not a signatory of the collective bargaining contract, should be bound nevertheless as an agent or successor of the signatory, an affiliate of the employer.

The union signed a collective bargaining contract with Uno-Ven Company covering workers at an oil refinery in Illinois that Uno-Ven owned. Uno-Ven was a 50-50 partnership between VPHI Midwest, Inc. (a wholly owned subsidiary of Venezuela's national petroleum company, PDV) and a wholly owned subsidiary of Unocal. Unocal wanted to get out of the domestic refining business. So it decided to relinquish its interest in the Illinois refinery and, to this end, to dissolve Uno-Ven. On the eve of dissolution, VPHI Midwest transferred its interest in the partnership to PDV Midwest Refining, LLC, another wholly owned subsidiary of PDV. (The parties call PDV Midwest Refining, LLC, "LLC," and we shall follow their usage, though, like "Inc.," the term LLC merely denotes a form of business organization--the limited liability company, similar to a corporation.) After the transfer, Uno-Ven, the partnership, was dissolved, with LLC receiving the Illinois refinery as its share of the partnership assets and the Unocal subsidiary receiving the remaining partnership assets as its share.

LLC, now the sole owner of the refinery, hired another wholly owned subsidiary of PDV, Citgo Petroleum Corporation, to operate it. Citgo hires and fires the workers employed in the refinery, establishes the conditions of their employment, and determines and pays their salaries and fringe benefits. Citgo is thus their "employer" in the ordinary sense of the word, as well as the sense it bears in federal labor law. NLRB v. E.C.

Page 781

Atkins & Co., 331 U.S. 398, 413-14, 67 S.Ct. 1265, 91 L.Ed. 1563 (1947); NLRB v. International Measurement & Control Co., 978 F.2d 334, 340 (7th Cir.1992) ("enterprise with effective direction over labor relations"). But it is not a signatory of the collective bargaining contract.

The union's complaint names as defendants all the companies mentioned in the preceding paragraph, even though the only employer of workers represented by the union is Citgo. Although an employer's duty to bargain collectively over terms and conditions of employment ceases when he leaves the business and thus ceases to be the employer of the workers in the bargaining unit, see, e.g., Pittsburgh & Lake Erie R.R. v. Railway Labor Executives' Ass'n, 491 U.S. 490, 507, 109 S.Ct. 2584, 105 L.Ed.2d 415 (1989); Textile Workers Union v. Darlington Mfg. Co., 380 U.S. 263, 270-72, 85 S.Ct. 994, 13 L.Ed.2d 827 (1965); NLRB v. Bell Co., 561 F.2d 1264, 1268 (7th Cir.1977); Railway Labor Executives' Ass'n v. CSX Transportation, Inc., 938 F.2d 224, 228 (D.C.Cir.1991); MT Properties, Inc. v. Transportation-Communications Int'l Union, 914 F.2d 1083, 1087-90 (8th Cir.1990), he remains bound by the contract, just like any other obligor who decides to go out of business before the contract expires. E.g., Textile Workers Union v. Darlington Mfg. Co., supra, 380 U.S. at 271, 85 S.Ct. 994; Wheelabrator Envirotech Operating Services Inc. v. Massachusetts Laborers District Council Local 1144, 88 F.3d 40 (1st...

To continue reading