Kinslow v. American Postal Workers Union

• Decision Date: 02 August 2000
• Docket Number: No. 99-2293,99-2293
• Citation: 222 F.3d 269
• Parties: (7th Cir. 2000) William Kinslow, Plaintiff-Appellee, v. American Postal Workers Union, Chicago Local, Defendant-Appellant
• Court: U.S. Court of Appeals — Seventh Circuit

Page 269

222 F.3d 269 (7th Cir. 2000)

William Kinslow, Plaintiff-Appellee, v. American Postal Workers Union, Chicago Local, Defendant-Appellant.

No. 99-2293

In the United States Court of Appeals For the Seventh Circuit

Argued February 11, 2000

Decided August 2, 2000

Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 92 C 4120--Milton I. Shadur, Judge. [Copyrighted Material Omitted]

Before Posner, Manion and Kanne, Circuit Judges.

Manion, Circuit Judge.

The late Tommy Briscoe used his presidency of the Chicago Local of the American Postal Workers Union to facilitate several different criminal schemes, including the embezzlement of Union funds. For obvious reasons, Briscoe and the Union secretary Elizabeth Bell didn't take kindly to Union member William Kinslow's persistent complaints and inquiries about Union finances. When Kinslow went so far as to request access to the Union's financial records and to sue the Union, it retaliated by expelling him. Kinslow sued Briscoe, Bell, and the Union under the Labor Management Reporting and Disclosure Act of 1959 ("LMRDA"). After a bench trial, Kinslow prevailed on his retaliation and access to financial records claims. He was awarded overtime pay, punitive damages, attorney's fees, and injunctive relief. The Union appeals, raising numerous arguments. Only its argument concerning overtime pay might have merit, so we vacate the award of overtime pay and remand the case for more specific findings on this claim. We affirm in all other respects.

I.

Tommy Briscoe was first elected president of the 4,000-member Chicago Local of the American Postal Workers Union in 1982. He soon began using his office for criminal schemes and was eventually indicted for embezzling Union funds. One of his partners in crime was codefendant Elizabeth Bell, who served as the Union's secretary and treasurer from 1981 until 1992. Briscoe was eventually convicted on fourteen counts, including charges of making illegal loans, destruction of financial records, mail and wire fraud, income tax evasion, and theft and embezzlement of union funds. United States v. Briscoe, 65 F.3d 576, 582 (7th Cir. 1995).¹ For her part, Bell pleaded guilty to aiding and abetting Briscoe in obtaining illegal loans from the Union. Because the present case was suspended due to Briscoe's criminal case, by the time it went to trial, Briscoe had died.

William Kinslow was a member of the Union since 1971. During the early part of the Briscoe administration, Kinslow served as executive vice president of the Local, during which time he began to suspect that something was amiss with Briscoe's use of Union funds. On many occasions he accused Briscoe and Bell of financial improprieties, such as using Union funds to lease Briscoe's car, bouncing checks drawn on Union accounts, and illegally "borrowing" funds from the Union. In October 1991, after Briscoe and Bell were indicted for their crimes, Kinslow requested from Bell copies of the Union's financial records, as was his right under federal law. For reasons that are now obvious, Bell ignored his requests.

Various Union leaders became fed up with Kinslow and began to retaliate against him. Several Union stewards refused to file grievances on Kinslow's behalf regarding the Postal Service's refusal to assign Kinslow overtime work. In an apparent effort to silence Kinslow or at least to make his charges seem incredible, the stewards threatened Kinslow and disparaged him to other Union members. In response, Kinslow submitted repeated complaints to Briscoe and the national Union about the objectionable treatment. These complaints were essentially ignored. The final straw came in July 1992, when Kinslow sent a letter to the Local's executive board outlining Briscoe's pattern of conduct and reminding the board of Briscoe's indictment. When Briscoe learned of the letter, he invited Kinslow to attend a board meeting to present his case. Kinslow declined, not only because of his claimed fear of bodily injury, but also because he recognized the futility of attending a Briscoe- led meeting. He did, however, urge the board to conduct its own investigation of Briscoe. Instead, the board charged Kinslow with engaging "in conduct that would expose the Union to civil liability," meaning his filing of this suit. Ironically, it is this charge that set in motion the events which would contribute to the Union's civil liability in this case. Although the accusation was out of line, in October 1992 the Union members voted unanimously to expel Kinslow. This gave Kinslow the distinction of being the only member expelled from the Union in at least twenty years. Undeterred, Kinslow appealed his expulsion to the national Union, but as usual he received no response.

Kinslow's suit was brought pursuant to the LMRDA, which was enacted to ensure that unions and their officials "adhere to the highest standards of responsibility and ethical conduct." 29 U.S.C. sec. 401(a). After the expulsion, Kinslow amended his complaint to allege that the Union retaliated against him for bringing the suit and for exercising his right to protest unethical conduct, and that the Union refused him access to the financial records. 29 U.S.C. sec.sec. 411(a)(2), 411(a)(4), 431(c). Because much of the evidence was undisputed, the district court needed only a three-day bench trial to find for Kinslow on all claims. The court granted equitable relief in the form of Kinslow's reinstatement and an injunction against further retaliation. It also awarded $40,000 for overtime wages that Kinslow lost because the Union failed to file grievances on his behalf, $1 for his loss of his LMRDA free speech rights, $150,000 in punitive damages, and attorneys' fees. Although Briscoe and Bell were also defendants, Briscoe died on the eve of trial and Bell is presumably judgment-proof, which explains why only the Union appeals.

II.

A. Examination of Union Financial Records

The Union presents a series of arguments asserting that the district court erred in finding that the Union violated Section 431 of the LMRDA by refusing Kinslow access to the Union's financial records. To understand the Union's arguments, a little background concerning the LMRDA is necessary.

After determining that some union leaders were running their organizations primarily for their own benefit, Congress enacted the Labor Management Reporting and Disclosure Act of 1959, in part to curb embezzlement and other unlawful activities. Finnegan v. Leu, 456 U.S. 431, 434 (1982); Mallick v. International Bhd. of Elec. Workers, 749 F.2d 771, 776 (D.C. Cir. 1984). Among other things, the LMRDA requires unions to file annual financial reports with the Secretary of Labor--known as LM-2 reports--detailing the union's assets, liabilities, and disbursements. 29 U.S.C. sec. 431(b). Because union members are often in the best position to discover union corruption and have a vested interest in honest union leaders, the Act also requires unions to make available to their members those records which purportedly corroborate the LM-2 reports. 29 U.S.C. sec. 431(c); Conley v. United Steelworkers of Am., Local Union No. 1014, 549 F.2d 1122, 1123 (7th Cir. 1977). The provision is designed "to make full information related to the financial affairs of unions available to members in order that they would be 'strengthened in their efforts to rid themselves of untrustworthy or corrupt officers.'" Conley, 549 F.2d at 1124 (quoting Antal v. District 5, United Mine Workers of Am., 451 F.2d 1187, 1189 (3d Cir. 1971)). But access to these reports is not unfettered. Believing that some union members might harass union officials with repeated requests for documents, the LMRDA only requires the production of financial records when the request is based on good cause. Specifically, the LMRDA states

Every labor organization required to submit a report under this subchapter shall make available the information required to be contained in such report to all of its members, and every such labor organization and its officers shall be under a duty . . . to permit such member for just cause to examine any books records, and accounts necessary to verify such report.

29 U.S.C. sec. 431(c) (emphasis added). Thus, in pursuing judicial enforcement of this right, the plaintiff has the burden of showing that he has just cause for seeking the information and that his request is not simply based on idle curiosity. Mallick, 749 F.2d at 784.

In attacking the district court's findings on this claim, the Union first argues that Kinslow had no just cause to see the Union's financial records. Many courts have noted that the "standard for determining whether there was just cause is necessarily minimal. Just cause need not be shown beyond a reasonable doubt, nor by a preponderance of the evidence. It need not be enough to convince a reasonable man that some wrong has been done . . . ." Fruit and Vegetable Packers and Warehousemen Local 760 v. Morley, 378 F.2d 738, 744 (9th Cir. 1967); see Landry v. Sabine Indep. Seamen's Ass'n, 623 F.2d 347, 349 (5th Cir. 1980). Indeed, a union member need not even suspect an impropriety, although a reasonably-based suspicion would certainly constitute just cause. The just cause requirement simply entails a showing that the union member had some reasonable basis to question the accuracy of the LM-2 or the documents on which it was based, or that information in the LM-2 has inspired reasonable questions about the way union funds were handled. Mallick, 749 F.2d at 781 ("Typically, union members will be interested in looking at underlying records precisely because they believe the LM-2 reports are accurate, and raise questions about the handling of union funds.").²

In this case, at the time Kinslow initially requested the records, Briscoe and Bell had already been indicted for embezzlement and for issuing improper loans with union funds. The...