Cuneo Press v. KOKOMO PAPER HANDLERS'UNION NO. 34

Decision Date30 July 1956
Docket NumberNo. 11611.,11611.
Citation235 F.2d 108
PartiesCUNEO PRESS, Inc., Plaintiff-Appellee, v. KOKOMO PAPER HANDLERS' UNION NO. 34, and Kokomo Printing Pressmen & Assistants' Union No. 302, International Printing Pressmen & Assistants' Union of North America, A. F. L., Defendants-Appellants, and International Printing Pressmen & Assistants' Union of North America, A. F. L., Defendant.
CourtU.S. Court of Appeals — Seventh Circuit

John S. McLellan, Kingsport, Tenn., Hugh E. Reams, Kingsport, Tenn., Minter, McLellan & Tipton, Kingsport, Tenn., of counsel, for appellants.

John K. Ruckelshaus, Indianapolis, Ind., John C. O'Connor, Indianapolis, Ind., Ruckelshaus, Reilly, Rhetts & O'Connor, Indianapolis, Ind., of counsel, for appellee.

Before DUFFY, Chief Judge and LINDLEY and SCHNACKENBERG, Circuit Judges.

SCHNACKENBERG, Circuit Judge.

The defendant unions Nos. 34 and 302, above named,1 have appealed from an order of the district court overruling their motion to stay proceedings in a suit theretofore filed in that court by Cuneo Press, Inc., in which said defendants and the international union above named were sued.

The following facts appear from the verified complaint filed in said suit by plaintiff:

Said action was brought pursuant to § 301 of the National Labor Management Relations Act of 1947.2 Plaintiff, engaged in the printing business in Kokomo, Indiana, and the unions on April 10, 1953 entered into a contract providing for its employees' wages, hours and working conditions. Article XIV of said contract provides:

"Article XIV. Work Stoppage.
"Section (1) It is understood that the Union is without power to compel its members to work with nonunion employees, and any such refusal to work shall not constitute a breach of this Agreement. The parties to this contract shall undertake to avoid any lockout, strike, slow down or stoppage of work during the life of this Agreement. In case of an unauthorized stoppage, the Union and the Employer will cooperate to fix responsibility and take appropriate action, disciplinary or otherwise, to remove the cause or causes." (Emphasis supplied.)

From January 24, 1955 to January 27, 1955, when said complaint was filed, the unions engaged in, induced, encouraged and caused the employees of plaintiff to engage in a strike or work stoppage. The officers, agents and employees of local No. 34 induced plaintiff's employees who are members of said union to cease working at the plant and to refuse to report for work "since January 24, 1955". The officers, agents and employees of local No. 302 engaged in, induced and encouraged all of plaintiff's employees who are members of said union to present themselves on the property and in the plant of plaintiff, but all of said employees refused to perform any work and participated in what is commonly termed a sit down strike. The unions caused said work stoppage of the entire operation of plaintiff's plant, because of their dispute with another union over certain work in that plant, amounting to not more than 1/10th of 1 per cent of the entire operations of the plant, and said work stoppage "was and is without just cause". Said unions are subsidiaries of the international union. The plant is primarily engaged in the publication of magazines and other periodicals which have a wide-spread national and international circulation. Said work stoppages "have rendered plaintiff" unable to carry out its contracts with publishers, to its irreparable damage. Defendants should be enjoined from further violating said contract, particularly article XIV thereof. Said contract provides for arbitration in the event of a dispute, but, notwithstanding such contract provision, the defendants "have refrained and refused" to arbitrate alleged grievances.

Plaintiff asks damages, a temporary restraining order and an injunction from further violation of said contract.

Upon the filing of the suit in the district court, the work stoppage ended. In oral argument here, it was stated and not denied that the stoppage lasted three days. There are entries in the district court's docket, incorporated in the record before us, which corroborate this statement.

On February 15, 1955, the unions moved "pursuant to the Arbitration Act, Title 9 U.S.C.A. § 3"3 "to stay the proceedings brought against them," in which motion they set forth: "since the issues involved are properly referable to arbitration under the contract between the plaintiff and these defendants, which said contract is referred to in paragraph II of the complaint, and these defendants being not in default in proceeding with such arbitration." In opposition to that motion plaintiff filed the affidavit of Frank H. Ingram, its vice-president, in which he averred, inter alia, that:

"* * * on January 24, 1955, the defendant Unions as charged in plaintiff\'s complaint, did engage in what is commonly termed a `sitdown strike\'; that such strike was called and conducted by said Unions in direct violation of the contract which was in full force and effect by and between such Unions and the plaintiff herein; that the Unions at no time made any attempt whatsoever to submit any agreement or complaint to arbitration, but on the contrary, proceeded to call such strike without warning or notice to the plaintiff; that if there were any grievances, which were submitted to arbitration in accordance with such contract of employment, the defendants were wholly in default in calling such strike without attempting to arbitrate any alleged complaint or grievance."

The district court, on September 12, 1955, denied the motion and this appeal followed.

1. Plaintiff asks us to dismiss the appeal because, so it says, the appeal is taken from an order which is not final or appealable.

We hold that the motion for a stay in this case was an application for an interlocutory injunction based upon the motion setting up the special defense of a duty to arbitrate. Shanferoke Co. v. Westchester Co., 293 U.S. 449, at page 452, 55 S.Ct. 313, 79 L.Ed. 583. See also Enelow v. N. Y. Life Ins. Co., 293 U.S. 379, 55 S.Ct. 310, 79 L.Ed. 440. Title 28 U.S.C.A. § 1292 provides that courts of appeals shall have jurisdiction of appeals from:

"(1) Interlocutory orders of the district courts of the United States, * * * refusing * * * injunctions, * * * except where a direct review may be had in the Supreme Court; * * *."

Hence the order in question is interlocutory and appealable.

Plaintiff relies on Baltimore Contractors v. Bodinger, 348 U.S. 176, 75 S.Ct. 249, 99 L.Ed. 233. There the court, 348 U.S. at page 184, 75 S.Ct. 249, distinguished that case from the Shanferoke case, which we believe is controlling here.

2. The local unions rely on § 3 of the Federal Arbitration Act, Title 9 U.S.C. A., § 3, supra, note (3). For the purpose of our disposition of this case, we

shall assume, without deciding, that said act is applicable to this case.4

It is obvious that the unions were not entitled to a stay unless it appeared that they were "not in default in proceeding with such arbitration." That is a part of § 3 and was recognized as essential by the unions when they stated in their motion for a stay, "these defendants being not in default in proceeding with such arbitration". According to the record, they...

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