O'Neill v. Airline Pilots Ass'n, Intern.

• Decision Date: 28 August 1991
• Docket Number: No. 88-2848,88-2848
• Citation: 939 F.2d 1199
• Parties: 138 L.R.R.M. (BNA) 2213, 119 Lab.Cas. P 10,898 Joseph E. O'NEILL, et al., Plaintiffs-Appellants, v. AIR LINE PILOTS ASSOCIATION, INTERNATIONAL, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1199

939 F.2d 1199

138 L.R.R.M. (BNA) 2213, 119 Lab.Cas. P 10,898

Joseph E. O'NEILL, et al., Plaintiffs-Appellants, v. AIR LINE PILOTS ASSOCIATION, INTERNATIONAL, et al Defendants-Appellees.

No. 88-2848.

United States Court of Appeals, Fifth Circuit.

Aug. 28, 1991.

Rehearing Denied Sept. 26, 1991.

Marty Harper, Allen R. Clarke, Lewis & Roca, Phoenix, Ariz., William E. Schweinle, Jr., Reginald H. Wood, Stubberman, McRae, Sealy, Laughlin & Browder, Houston, Tex., for plaintiffs-appellants.

Harold G. Levison, Mudge, Rose, Guthrie, Alexander & Ferdon, New York City, John A. Irvine, Thelen, Marrin, Johnson & Bridges, Houston, Tex., for defendants-appellees.

Appeal from the United States District Court for the Southern District of Texas.

ON REMAND FROM THE UNITED STATES SUPREME COURT

Before POLITZ, DAVIS and DUHE, Circuit Judges.

W. EUGENE DAVIS, Circuit Judge:

This labor case is again before us on remand from the Supreme Court. We conclude that the pilots did not present a triable issue of material fact on the union's alleged bad faith breach of its duty of fair representation. We therefore affirm the district court's summary judgment for the union.

I.

This dispute arises out of the settlement of a two-year strike by the Air Line Pilots Association, International (ALPA) against Continental Air Lines (Continental). ¹ The strike was settled by an "Order and Award" entered by the bankruptcy court supervising Continental's reorganization. ALPA consented to entry of the order and award without notice to or ratification by Continental pilots or the Continental Master Executive Council (MEC). ² A certified class of Continental pilots then sued ALPA for its actions in connection with the settlement, claiming ALPA breached its duty of fair representation (DFR) under the Railway Labor Act, 45 U.S.C. Secs. 151-188. ³ The district court granted ALPA's motion for summary judgment from the bench. We reversed, concluding that a jury would be entitled to find that the strike settlement breached the union's DFR on at least two grounds: (1) it was so unfavorable as to be arbitrary; and (2) it impermissibly discriminated between strikers and nonstrikers. O'Neill v. Air Line Pilots Ass'n, Int'l, 886 F.2d 1438, 1448-49 (5th Cir.1989).

The Supreme Court reversed. Air Line Pilots Ass'n, Int'l v. O'Neill, 499 U.S. ----, 111 S.Ct. 1127, 113 L.Ed.2d 51 (1991). The Supreme Court held that "a union's actions are arbitrary only if, in light of the factual and legal landscape at the time of the union's actions, the union's behavior is so far outside a 'wide range of reasonableness' as to be irrational." Id. 499 U.S. at ----, 111 S.Ct. at 1130, 113 L.Ed.2d at 58 (citation omitted). Applying this test, the Supreme Court found that the union's strike settlement was not so unreasonable or discriminatory as to be arbitrary and therefore the union did not breach its DFR on those grounds. However, the Supreme Court noted that "[b]ecause it reversed the District Court's grant of summary judgment on the arbitrariness component, the Court of Appeals did not decide whether summary judgment on the fair representation claim might be precluded by the existence of other issues of fact." Id. at ----, 111 S.Ct. at 1133, 113 L.Ed.2d at 61. The Court further "express[ed] no opinion on whether respondents have put forth a triable issue concerning whether ALPA acted in bad faith." Id. at ----, 111 S.Ct. at 1133, 113 L.Ed.2d at 61 n. 6.

Thus the question we are faced with on remand is whether the pilots have raised a genuine issue of material fact that ALPA has violated its DFR in bad faith. We find that the pilots have not raised such a triable issue.

II.

Vaca v. Sipes, 386 U.S. 171, 87 S.Ct. 903, 17 L.Ed.2d 842 (1967), is "the leading case" in the area of a union's duty of fair representation. O'Neill, 499 U.S. at ----, 111 S.Ct. at 1134, 113 L.Ed. at 63. In Vaca, Justice White explained:

The statutory duty of fair representation was developed over 20 years ago in a series of cases involving alleged racial discrimination by unions certified as exclusive bargaining representatives under the Railway Labor Act and was soon extended to unions certified under the N.L.R.A. Under this doctrine, the exclusive agent's statutory authority to represent all members of a designated unit includes a statutory obligation to serve the interests of all members without hostility or discrimination toward any, to exercise its discretion with complete good faith and honesty, and to avoid arbitrary conduct.

386 U.S. at 177, 87 S.Ct. at 910 (citations omitted). In other words, "[a] breach of the statutory duty of fair representation occurs only when a union's conduct toward a member of the collective bargaining unit is arbitrary, discriminatory, or in bad faith." Id. at 190, 87 S.Ct. at 916. Because the Supreme Court has held that ALPA's conduct was neither arbitrary nor discriminatory, the pilots must now rest their DFR claim on ALPA's alleged "bad faith." We turn to the summary judgment evidence relating to this issue.

The pilots assert in their summary judgment evidence that ALPA breached its DFR in bad faith by making several misrepresentations. These include statements to the pilots concerning their ability to ratify any settlement agreement and statements to retired and resigned pilots that they would be included in any settlement. The pilots also assert that ALPA fabricated a bankruptcy court "gag order" to avoid keeping the MEC informed about final negotiations. Relatedly, the pilots complain that ALPA implemented the settlement as a bankruptcy court order to circumvent ratification requirements and responsibility for its content. Finally, the pilots state that ALPA violated its own internal union procedures that called for the MEC to ratify any settlement agreement. ⁴ We will address each of these allegations in turn.

A. Alleged misrepresentations

1. Pilot ratification

The pilots first contend that ALPA promised the pilots throughout the strike that they would be able to ratify any strike settlement with Continental. ⁵ The pilots argue that these unfulfilled promises of ratification, if proven at trial, show that ALPA breached its DFR in bad faith.

In our original opinion, we held that the pilots had no right to ratify the Continental settlement under section 101(a)(1) of the Labor-Management Reporting and Disclosure Act (LMRDA), 29 U.S.C. Sec. 411. See O'Neill, 886 F.2d at 1447-48. This LMRDA voting rights decision was not appealed to the Supreme Court and is now final. See O'Neill, 499 U.S. at ---- n. 2, 111 S.Ct. at 1131 n. 2, 113 L.Ed.2d at 60 n. 2. While it is now settled that the pilots did not have the right to ratify the Continental settlement, we have never considered directly whether alleged promises of ratification could support the pilots' claim that ALPA breached its DFR in bad faith. The pilots cite to our original opinion in which we said that "[a] factfinder might infer a breach of ALPA's duty of fair representation if it finds the union misrepresented the right of the membership to ratify any settlement agreement." 886 F.2d at 1448. To support our statement, we relied on Acri v. International Association of Machinists, 781 F.2d 1393, 1397 (9th Cir.), cert. denied, 479 U.S. 816, 107 S.Ct. 73, 93 L.Ed.2d 29 (1986), in which the Ninth Circuit said that "a duty of fair representation cause of action can be maintained when union representatives make misrepresentations to the union membership during the ratification process."

However, ALPA correctly points out that in Acri, unlike the instant case, the membership had the right to ratify the agreement. In Acri, union members struck over a number of issues including limits on severance pay. At a union meeting, union representatives allegedly misrepresented to the union members that the employer had agreed to remove the opposed limit on severance pay. The union members then ratified the new agreement not knowing that it did not contain a change in the severance pay provision. When the union members later learned of the discrepancy, they sued the union for breaching its DFR. It is in this context that the Ninth Circuit said that "the duty of fair representation extends to misrepresentations during ratification." 781 F.2d at 1397. Thus the Ninth Circuit was addressing the issue of a union misrepresenting a settlement to its members, thereby eviscerating the members' right to ratify in breach of the union's DFR. ⁶ ALPA argues that because the pilots had no such ratification right, ALPA could not have breached its DFR in this way.

We need not address this particular argument, however, because ALPA's alleged statements do not present a triable issue that it breached its DFR in bad faith. As the Seventh Circuit has explained in affirming summary judgment based on similar alleged misrepresentations by a union to its members:

[E]very inaccuracy should not form the basis of a federal suit. A strike often presents unique pressures. The atmosphere may be tense, charged and confused. The situation is intensely adversary. Decisions and statements are sometimes made in haste, under pressure and in the belief that the other side is disseminating manipulated or distorted information to which a response is required. Union leaders, in exhorting the membership, may voice opinions that later prove inaccurate, or make claims that turn out to be hyperbole. So long as such statements are not intentionally misleading and are not of a nature to be reasonably relied upon by the membership ... they may not rise to the level of invidious actions barred by the duty of fair representation. To conclude otherwise would have a chilling effect on the right to strike itself by instilling a fear of unjustifiable lawsuits.

Swatts v. United Steelworkers, 808 F.2d 1221, 1225 (7th Cir.1986); see also Bautista v. Pan American World Airlines, 828 F.2d 546, 550-51 (9th Cir.1987) (following Swatts in affirming summary judgment...