453 F.2d 1035 (6th Cir. 1972), 71-1021, Riverton Coal Co. v. United Mine Workers of America

Docket Nº:71-1021, 71-1022.
Citation:453 F.2d 1035
Party Name:RIVERTON COAL COMPANY and Davison Fuel and Dock Company, Plaintiffs-Appellants and Plaintiffs-Appellees, v. UNITED MINE WORKERS OF AMERICA, Defendant-Appellee and Defendant-Appellant.
Case Date:January 21, 1972
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit
 
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Page 1035

453 F.2d 1035 (6th Cir. 1972)

RIVERTON COAL COMPANY and Davison Fuel and Dock Company, Plaintiffs-Appellants and Plaintiffs-Appellees,

v.

UNITED MINE WORKERS OF AMERICA, Defendant-Appellee and Defendant-Appellant.

Nos. 71-1021, 71-1022.

United States Court of Appeals, Sixth Circuit.

January 21, 1972

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[Copyrighted Material Omitted]

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J. Mack Swigert, Cincinnati, Ohio, for Riverton Coal Co., et al.; Robert J. Townsend, Cincinnati, Ohio, on brief; Taft, Stettinius & Hollister, Cincinnati, Ohio, of counsel.

Harrison Combs, Washington, D. C., for United Mine Workers; Edward L. Carey, Washington, D. C., E. H. Rayson, Knoxville, Tenn., Robert I. Doggett, Cincinnati, Ohio, M. E. Boiarsky, Charleston, W. Va., on brief.

Before PHILLIPS, Chief Judge, and WEICK and CELEBREZZE, Circuit Judges.

WEICK, Circuit Judge.

Riverton Coal Company (Riverton) and Davison Fuel and Dock Company (Davison) have appealed from a judgment of the District Court dismissing their joint action against United Mine Workers of America (UMW) for recovery of damages under Section 303 of the Labor Management Relations Act of 1947, as amended (29 U.S.C. § 187), because of violations of Section 8(b) (4) and Section 8(e) of the Act.

The case was tried to the Court without a jury. Findings of fact and conclusions of law were adopted, in which the Court held that UMW had not violated the Act, and dismissed the complaint. Because of the difficult nature of the case and the closeness of the questions involved, the Court made findings of fact as to damages against UMW in the amount of $150,312.50, plus interest, for use of the Appellate Court so that the case could be finally disposed of on appeal without remand for retrial on the issue of damages, in the event the judgment was reversed on the issue of liability.

UMW filed a cross-appeal complaining of errors in the findings of fact and conclusions of law adopted by the District Court.

Both Riverton and Davison are corporations; the former is organized under the laws of West Virginia, and the latter under Ohio laws. Riverton was engaged in the business of coal mining and loading river barges on the Kenawha River at Crown Hill and Marmet, West Virginia. Davison had offices at North Bend, Ohio, and was engaged in the business of selling coal. Davison was exclusive sales agent for all of Riverton's mined and purchased coal, receiving a commission ranging from six to eight per cent of the selling price. Riverton was a wholly owned subsidiary of Davison, which kept Riverton's books and records. The capital stock of Davison was closely held and a majority of the stock was owned by the Davison family.

Riverton entered into a collective bargaining agreement with UMW, effective December 1, 1958, which was not subject to termination prior to November 30, 1959, but thereafter either party could

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terminate the agreement upon thirty days' written notice to the other.

UMW is an unincorporated labor organization with headquarters in Washington D. C. and a district office in Charleston, West Virginia. It was the exclusive bargaining representative of Riverton's employees, who worked in the coal mines in West Virginia. The employees belonged to Local 1209 of UMW.

It was customary for Riverton to purchase coal to supplement its production to fill orders and to meet market requirements. It operated its own mines to full capacity but could not mine enough coal to meet all of its sales requirements because of limited financial resources and lack of necessary mining equipment.

In 1962-63 Davison sold 2,170,000 tons of coal, of which 44 1/2% was coal which had been purchased by Riverton and Davison from other coal mine operators, some of whom were signatory to UMW agreements and others of whom were not. The base price of coal purchased was the same from all operators, namely, four dollars per ton. Also, the quality of the coal was the same. During nine months prior to April, 1964, 78% of the coal purchased by Riverton was purchased from nonsignatory mines, and 22% was purchased from signatory mines.

Some of the suppliers of coal operated on lands in which Riverton and Davison had no interest; others operated on lands owned by Davison and leased to them by Riverton.

The District Court found that in the fall of 1963 UMW, through District 17, called to plaintiffs' attention "the fact that it was doing business with nonunion operators operating under leases from plaintiff on lands controlled by plaintiff and the purpose was to secure plaintiff's 'help' in organizing these operators in exchange for a Union 'consent' to a business enterprise plaintiff was interested in." Riverton officials did not commit themselves.

In November, 1963, District 17 again contacted Riverton to ascertain what it was doing to force nonsignatory operators to become signatories to a UMW contract. Riverton asked for a list of such operators, which was supplied. It was not claimed that the employees of the nonsignatory operators desired UMW to act as their bargaining representative. Riverton did nothing to induce any of the nonsignatory operators to become signatories.

I

THE 1964 STRIKE

The District Court found that while the 1958 Collective Bargaining Agreement was in full force and effect, UMW, in violation of the terms and provisions thereof, authorized a work stoppage at Riverton's mines commencing on April 10, 1964, which continued until the evening of April 15, 1964. The strike was also a violation of Section 8(d) of the Act.

The Court found that an object of the April 1964 strike was to force or require Riverton to enter into the proposed 1964-form of printed amendment to the National Bituminous Coal Wage Agreement of 1950. The Court further found:

"Another object of the said strike was to force or require Riverton and Davison to cease using, selling, handling, transporting or otherwise dealing in the products of coal producers who were not signatories to an agreement with the defendant Union and to cease doing business with such producers. Another effect of the said strike was to encourage coal producers selling coal to Riverton or Davison to recognize or bargain with the defendant Union as the representative of the employees of such producers even though the defendant Union had not been certified as the representative of such employees under the provisions of Section 9 of the Act. After Riverton signed the 80-cent clause, and as a result

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thereof, some fifteen nonunion producers from which Riverton had been buying supplemental coal became signatories to the UMW agreement. Some twenty-two did not-so the effect was not to 'force' or 'compel' but to encourage."

In order to settle the strike and resume operation of its mines, Riverton was forced to sign the National Bituminous Coal Wage Agreement of 1950, as amended, effective April 2, 1964, which it did under protest on April 15, 1964, and UMW then withdrew its pickets and permitted the mines to resume operations.

The 1964 amendment contained the so-called "80-cent penalty clause" and the "coal lands clause", which Riverton objected to as being illegal. 1 The Protective Wage Clause was dropped from the agreement in that year. Prior to the 1964 Amendment signatories were required to pay into the Welfare Fund forty cents per ton of coal produced by them. The purpose of the amendment was to require signatories who procured or purchased from non-signatories soft coal for sale or use, to pay into the Welfare Fund eighty cents per ton of coal so purchased or procured.

In South-East Coal Co. v. Consolidation Coal Co., 434 F.2d 767 at 781 (6th Cir. 1970), we said:

"While the stated purpose of the amendment was to protect work standards by equalizing labor costs between employees of signatories and nonsignatories, the obvious effect was to discourage signatories from purchasing or acting as sale agents for coal companies which produced coal with non-UMW laborers."

The District Court stated that the eighty cent penalty clause and the "coal lands" clause were the "legal" substitutes for the PWC clause in the 1958 agreement after PWC had been held by the National Labor Relations Board to violate Section 8(e) of the Act. Raymond O. Lewis, et al., 144 NLRB 228 (1963). 2

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It was the opinion of the District Court that the primary purposes of the eighty cent penalty and the coal land clauses were to protect work opportunities and wages of UMW members and to maintain the integrity of the UMW Welfare and Retirement Fund. Much evidence was offered by UMW on the history of its bargaining and the plight of its members due to competition with other fuels, with a substantial loss of business.

Notwithstanding this, the District Court specifically found that "an object" of the 1964 strike was to force Riverton to sign the agreement containing the eighty cent penalty clause. Another object was to compel Riverton and Davison to cease doing business with, and to cease using the products of, other coal producers who were nonsignatories. The foreseeable purpose of the eighty cent clause was "the unionization of some non-union employers."

It is clear that Section 8(b) (4) of the Act forbids strike action if "an object" is to force an employer to do any of the things prohibited by Section 8(e). The statute does not mention primary object or purpose. If any object of the strike is forbidden by Section 8(b) (4), it is a secondary boycott. It is not necessary to find that it was the sole object. N.L.R.B. v. Denver Bldg. & Const. Trades Council, 341 U.S. 675, 71 S.Ct. 943, 95 L.Ed. 1284 (1951).

Granting that UMW at all times desired to protect and preserve the work opportunities of its members and their pension fund, which is certainly a worthy motive, this intention does not give UMW a license to violate other laws which violation the District Court found was an object of the strike. UMW v....

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