James R. Snyder Co., Inc. v. Edward Rose & Sons, Inc., 75-2233

• Decision Date: 14 December 1976
• Docket Number: No. 75-2233,75-2233
• Citation: 546 F.2d 206
• Parties: 94 L.R.R.M. (BNA) 2011, 80 Lab.Cas. P 11,829, 1976-2 Trade Cases 61,189 JAMES R. SNYDER CO., INC., et al., Plaintiffs-Appellants, v. EDWARD ROSE AND SONS, INC., et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 206

546 F.2d 206

94 L.R.R.M. (BNA) 2011, 80 Lab.Cas. P 11,829,

1976-2 Trade Cases 61,189

JAMES R. SNYDER CO., INC., et al., Plaintiffs-Appellants, v. EDWARD ROSE AND SONS, INC., et al., Defendants-Appellees.

No. 75-2233.

United States Court of Appeals, Sixth Circuit.

Argued June 17, 1976.

Decided Dec. 14, 1976.

Donald E. Mather, Mather, Glime & Daoust, Mount Clemens, Mich., Jerry S. Cohen, Michael D. Hausfeld, Washington, D.C., for plaintiffs-appellants.

Irwin Alterman, Hyman & Rice, Southfield, Mich., Joseph T. Brennan, Farmington Hills, Mich., Robert G. Cutler, David M. Fitzgerald, Dykema, Gossett, Spencer, Goodnow & Trigg, Detroit, Mich., for defendants-appellees.

Before PHILLIPS, Chief Judge, and EDWARDS and ENGEL, Circuit Judges.

ENGEL, Circuit Judge.

Plaintiffs brought this suit under Sections 4 and 16 of the Clayton Act, 15 U.S.C. §§ 15 and 26, seeking treble damages and injunctive relief for violation of § 1 of the Sherman Act. 15 U.S.C. § 1. The gist of plaintiffs' complaint is that the defendant-appellees, with other defendant employer associations, conspired with construction trade unions (not named as defendants) to impose the terms of a multi-trade labor agreement upon the plaintiffs for the purpose of forcing them out of business.

Plaintiffs are mason contractors and members of the Detroit Mason Contractors Association. The four named defendants involved in the instant appeal are members of the Builders Association of Metropolitan Detroit (BAMD). These defendants in 1970 each granted a general power of attorney to BAMD as its exclusive agent for the purpose of bargaining with the unions and negotiating a collective contract. ¹ BAMD then joined with approximately 24 other construction employer trade associations in designating the Construction Employers Council (CEC) as its bargaining agent. In turn, CEC chose a six-person committee to carry on actual labor negotiations with a committee representing 24 construction trade unions. The two committees did not attempt to negotiate complete labor contracts, but negotiated instead to establish the level of wages and fringe benefits which their principals would pay and receive, respectively. This multi-employer/multi-union bargaining was a new concept in the Detroit area. A number of employers, including plaintiffs, did not participate. Plaintiffs separately negotiated with the Laborers and Bricklayers Unions after the multi-trade agreements had been reached.

On motion for summary judgment by the four-named corporate appellees, the district court, accepting the plaintiffs' contention that the alleged illegal activities affected interstate commerce, found that jurisdiction existed under the Sherman Act. The district court, however, assuming that a conspiracy violative of the Sherman Act might have been entered into at the labor negotiations, ² granted judgment to the appellees on the basis that Section 6 of the Norris-LaGuardia Act, 29 U.S.C. § 106, precluded finding them liable solely on the existence of the powers of attorney, observing:

The powers of attorney are the only evidence which plaintiffs present to connect the moving defendants with the alleged conspiracy. These powers of attorney fail to provide any evidence of actual authorization to enter into the conspiracy, let alone clear proof of such authorization. Therefore the moving defendants are entitled to summary judgment. ³

Section 6 of the Norris-LaGuardia Act provides:

No officer or member of any association or organization, and no association or organization participating or interested in a labor dispute, shall be held responsible or liable in any court of the United States for the unlawful acts of individual officers, members, or agents, except upon clear proof of actual participation in, or actual authorization of, such acts, or of ratification of such acts after actual knowledge thereof.

Central to the consideration of § 6 is United Brotherhood of Carpenters v. United States, 330 U.S. 395, 67 S.Ct. 775, 91 L.Ed. 973 (1947). Both parties rely on it. Its proper construction, we think, compels the decision reached by the district judge. ⁴ There, the Supreme Court reviewed in detail the history of the enactment of § 6. In large part the impetus for the statute originated in the federal courts' alacrity to impose liability on unions for the lawless actions of their members. Particularly, the advocates of § 6 wished to overrule Lawlor v. Loewe, 235 U.S. 522, 35 S.Ct. 170, 59 L.Ed. 341 (1915), popularly known as the Danbury Hatters Case. In that case, damages were sought from labor unions and their members for an alleged unlawful conspiracy to deprive non-union manufacturers of hats from access to interstate markets. The Supreme Court, speaking through Mr. Justice Holmes, held that traditional rules of agency would suffice to support a jury finding that the unions and their members authorized the allegedly unlawful activities which constituted the antitrust violation. It was this decision which prompted the enactment of § 6 of the Norris-LaGuardia Act. While many attacked the provision as a restriction on the general law of agency in labor disputes, the Senate Committee deemed the statute a new rule of evidence rather than a rule of agency. The Supreme Court in Carpenters found it unnecessary to determine which field of law it altered. Its effect was clear:

We need not determine whether § 6 should be called a rule of evidence or one that changes the substantive law of agency. We hold that its purpose and effect was to relieve organizations, whether of labor or capital, and members of those organizations from liability for damages or imputation of guilt for lawless acts done in labor disputes by some individual officers or members of the organization, without clear proof that the organization or member charged with responsibility for the offense actually participated, gave prior authorization, or ratified such acts after actual knowledge of their perpetration Carpenter, 330 U.S. at 403, 67 S.Ct. 775.

The defendants in Carpenters were local manufacturers of and dealers in millwork and pattern lumber, together with certain unincorporated trade unions and their officials. It was charged the manufacturers and trade unions had conspired to restrain out-of-state manufacturers from selling these commodities in the San Francisco Bay area. In submitting the case to the jury, the district court in its instructions had charged the jury that "the act of an agent done for or on behalf of a corporation and within the scope of its authority, or an act which an agent has assumed to do for a corporation while performing duties actually delegated to him, is deemed to be the act of the corporation". Carpenters, 330 U.S. at 407, n. 19, 67 S.Ct. at 782.

The Supreme Court held that this charge was error and that the authorization as spelled out in § 6 called for something different from traditional agency principles:

We are of the opinion that the requirement of "authorization" restricts the responsibility or liability in labor disputes of employer or employee associations, organizations or their members for unlawful acts of the officers or members of those associations or organizations, although such officers or members are acting within the scope of their general authority as such officers or members, to those associations, organizations or their officers or members who actually participate in the unlawful acts, except upon clear proof that the particular act charged, or acts generally of that type and quality, had been expressly authorized, or necessarily followed from a granted authority, by the association or non-participating member sought to be charged or was...