Iron Molders' Union Local No. 68 v. Niles-Bement-Pond Co.

Citation258 F. 408
PartiesIRON MOLDERS' UNION, LOCAL NO. 68, et al. v. NILES-BEMENT-POND CO. et al.
Decision Date06 November 1918
CourtUnited States Courts of Appeals. United States Court of Appeals (6th Circuit)

W. B Rubin, of Milwaukee, Wis., and R. J. Shank, of Hamilton Ohio, for appellants.

Murray Seasongood, of Cincinnati, Ohio, and Allen Andrews, of Hamilton, Ohio, for appellees.

Before KNAPPEN and DENISON, Circuit Judges, and McCALL, District judge.

PER CURIAM.

This case presents a question of jurisdiction of the District Court, dependent entirely upon diversity of citizenship. The bill was filed by appellee Niles-Bement-Pond Company, a New Jersey corporation, as sole plaintiff, against the Niles Tool Works Company, an Ohio corporation, doing business at Hamilton, Ohio (hereinafter called the defendant company or the Tool Works), together with a large number of individual defendants (including two unincorporated Iron Molders' Union locals, located at Hamilton); the others being officers, representatives, or members of the respective unions or persons acting in sympathy therewith. The individual defendants are all residents of Ohio. If the defendant company is properly aligned with the individual defendants, jurisdiction exists. If, however, it should be aligned as a coplaintiff jurisdiction fails; for, in determining jurisdiction, the parties must be aligned, as plaintiffs or defendants respectively, according to their mutual interests. Dawson v. Columbia Trust Co., 197 U.S. 178, 25 Sup.Ct. 420, 49 L.Ed. 713; Hamer v. N.Y. Railways Co., 244 U.S. 266, 274, 37 Sup.Ct. 511, 61 L.Ed. 1125.

This suit is an outgrowth of a strike by former employes of the Tool Works (the defendant company) who are members of one of the Molders' Union locals. Its object is to restrain defendants other than the Tool Works from acts of intimidation, threats, abuse, and violence directed toward the Tool Works' employes and their families, as well as the congregating by individual defendants, and those acting in concert or sympathy with them, at or about the Tool Works factory and plant, as well as at the homes of that company's workmen. The District Court granted a preliminary injunction. 246 F. 851. This appeal is from that action.

Plaintiff's interest in and relations to the strike, and the grounds on which its claim to relief is based, are these: It has contracts for machinery and munitions to be furnished the government of the United States, amounting in value to about $3,000,000, the greater part thereof being for work necessary for the prosecution of the present war; its contracts therefor being either directly with the government or with concerns which have such contracts therewith, priority for such work being given by the National Defense Act (Act June 3, 1916, c. 134, 39 Stat. 166). Plaintiff has placed orders for a large amount of this work with the defendant company and cannot well have it performed elsewhere; the work so contracted for being nearly all partially manufactured and constructed, and being of such kinds and sizes that it cannot profitably be removed from the Tool Works' plant or completed elsewhere. Indeed, industrial plants generally which are equipped for manufacturing this class of machinery have prior orders in such amount as to forbid taking on the orders in question. Plaintiff is also prevented by the strike from taking further profitable contracts for similar work offered by the governments allied with the United States, as well as by other contractors. The strike will occasion plaintiff heavy loss of profits, besides subjecting it to danger of forfeiture of contracts and large damages. But for the threatened violence on the part of strikers and sympathizers, the defendant company could perform the contracts with plaintiff.

It is clear that plaintiff has a right to complain of unlawful injuries to its rights, but it seems equally clear that the defendant company, if it is to be a party, is interested on the same side of the suit with plaintiff, and that as between these two parties there is no adverse interest. The plaintiff absolutely controls the defendant company, through plaintiff's ownership of the entire common stock and a majority of the preferred stock of that company-- the two corporations having a common president, one vice president in common, a majority of the board of directors of the defendant company being also directors of the plaintiff company. Each company, however, has a separate manager. The defendant company is essentially a subsidiary of the plaintiff. Ninety-five per cent. of the work done by the defendant company is allotted to it by the plaintiff. From the gross price under plaintiff's contracts with the government and others so allotted to defendant company, plaintiff receives a commission of 10 per cent. The defendant company receives the balance. The president of the two companies is authorized to fix the prices under its contracts with the government and others, and thus in effect the prices which the defendant company shall receive. Naturally and normally, the two corporations would stand together in every way, so far as their interests in this suit are concerned. That they do so stand together is affirmatively shown. The defendant company employed and paid the guards and watchman, and the representatives of the two companies consulted together regarding the strike, 'how to manage it and how to get men into the foundry. ' The defendant company seems not to have appeared of record in the suit; its works manager testified that he 'should say' that the counsel present at the trial (employed by plaintiff) represented both plaintiff and defendant company (presumably in reference to the conduct of the strike), that the witness had consulted with the attorneys named 'in regard to matters connected with this strike,' and that one of them represented the defendant company when one of the strikers was arrested, apparently during the strike now in question.

The bill states no case for relief against the defendant company and no such relief is asked, unless by the general prayer that the 'court grant plaintiff any and all other equitable relief which in equity and good conscience it is entitled to receive. ' Indeed, plaintiff's control of the defendant company, and the complete harmony between them, renders relief at the hands of the court as against defendant company entirely unnecessary. It is equally clear that the interests of the defendant company and those of the individual defendants are wholly adverse to each other.

The pivotal question thus is whether the defendant company has such a real interest in the subject-matter of the litigation as to render its presence necessary to make the final decree effectual. If so, it is an indispensable party. Hamer v N.Y. Railways Co., 244 U.S. 266, 274, 37 Sup.Ct. 511, 61 L.Ed. 1125, and cases there cited; Steele v. Culver, 211 U.S. 26, 29, 29 Sup.Ct. 9, 53 L.Ed. 74; Lindauer v. Compania Palomas, etc. (C.C.A. 8) 247 F. 428, 432, 159 C.C.A. 482; South Penn Oil Co. v. Miller (C.C.A. 4) 175 F. at page 737, 99 C.C.A. 305; Waterman v....

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