Hohe v. Casey

Decision Date10 February 1992
Docket NumberNo. 91-5002,91-5002
Citation956 F.2d 399
Parties139 L.R.R.M. (BNA) 2468, 60 USLW 2576 Mary A. HOHE; Timothy L. Cassel; Joseph F. Clover, III; Vickie M. Clover; Steven A. Ebersole; Linda R. Garman; Arlene J. Hetzel; Carol D. Hench; Francis D.M. Hill, Jr.; Mark A. Kantorczyk; Nancy Lebo; Gerald J. Maher; Jeri Morris; Jack H. Reefer, Jr.; Thompson M. Young, II, Appellants, v. Robert P. CASEY, Governor, Commonwealth of Pennsylvania; Joseph L. Zazyczny, Secretary of Administration, Commonwealth of Pennsylvania; G. Davis Greene, Jr., State Treasurer, Commonwealth of Pennsylvania; Commonwealth of Pennsylvania; and Council 13, American Federation of State, County and Municipal Employees, v. Leroy S. ZIMMERMAN, Attorney General, Commonwealth of Pennsylvania; Don Bailey, Auditor General, Commonwealth of Pennsylvania; Frederick T. Marens, Executive Director, Pennsylvania Crime Commission; Kenneth R. Reeher, Executive Director, Pennsylvania Higher Education Assistance Agency; William R. Shane, Chairman, Public Utility Commission; Donald W. Bagenstose, Executive Director, State Public School Building Authority; James H. McCormick, Chancellor, State System of Higher Education; Robert J. Bray, Jr.
CourtU.S. Court of Appeals — Third Circuit

Raymond J. LaJeunesse, Jr. (argued), National Right To Work Legal Defense Foundation, Springfield, Va., John G. Milakovic, Thomas A. Beckley, Charles O. Beckley, II, Beckley & Madden, Harrisburg, Pa., for appellants.

Alaine S. Williams (argued), Caren Litvin Sacks, Walters, Willig, Williams & Davidson, Philadelphia, Pa., for appellee Council 13 of the American Federation of State, County and Municipal Employees, AFL-CIO.

Susan J. Forney (argued), Sr. Deputy Atty. Gen., Calvin R. Koons, Sr. Deputy Atty. Gen., John G. Knorr, III, Chief Deputy Atty. Gen., Office of the Attorney General of Pennsylvania, Harrisburg, Pa., for appellees Commonwealth of Pennsylvania, Robert P. Casey, Joseph L. Zazyczny, G. Davis Greene, Jr., Leroy S. Zimmerman, Dan Bailey, Frederick T. Martens, Kenneth R. Reeher, William T. Shane, Donald W. Bagenstose, James H. McCormick.

Before HUTCHINSON, COWEN, and SEITZ, Circuit Judges.

OPINION OF THE COURT

SEITZ, Circuit Judge.

Class action plaintiffs, nonunion employees, appeal the order of the district court to the extent it grants final judgment in favor of various officials of the Commonwealth of Pennsylvania, (the "Commonwealth"), and Council 13 of the American Federation of State, County and Municipal Employees, ("Council 13"), (collectively "the defendants"). Plaintiffs' sought, inter alia, declaratory and injunctive relief against the implementation of Section 2 of The Public Employee Relations Act No. 84 of 1988 (S.B. 291), Pa.Stat.Ann. tit. 71, § 575 (Purdon Supp.1990) [hereinafter "Act" ]. This section permits the Commonwealth and the exclusive representative selected by the unionized employees of the Commonwealth to enter into a fair share fee agreement. 1

I. FACTUAL AND PROCEDURAL BACKGROUND

In July 1988, the General Assembly of the Commonwealth of Pennsylvania passed the Act, which became effective immediately. Pursuant to the Act, the Commonwealth of Pennsylvania and Council 13, the exclusive bargaining representative for approximately 54,000 Commonwealth employees, amended their collective bargaining agreement to provide for the deduction of fair share fees. Between August 8 and 12, 1988, Council 13 mailed notices to approximately 18,000 nonmembers for whom it served as the exclusive collective bargaining representative. This notice informed the nonmembers that beginning August 16, the Commonwealth would deduct fair share fees from their wages and transmit those fees to Council 13. The notice also provided nonmembers with certain information concerning Council 13's calculation of the fair share fee and the procedures it had established to enable the nonmembers to challenge the fee.

On August 26, 1988, the fifteen named plaintiffs, Commonwealth employees represented by, but not members of, Council 13, initiated this action against Council 13 and various officials of the Commonwealth. They sought injunctive and declaratory relief under 42 U.S.C. § 1983 barring the implementation of the Act, and certain subsections related to provisions in the collective bargaining agreement between the Commonwealth and Council 13, as well as the collection procedures adopted by Council 13. Plaintiffs also requested damages for the alleged constitutional violations. The basis of the nonmembers' § 1983 claims was that the challenged subsections, provisions and procedures violated the First and Fourteenth Amendments of the United States Constitution.

On August 30, 1988, the district court issued a temporary restraining order prohibiting the Commonwealth from deducting the fair share fees pending a hearing on plaintiffs' motion for a preliminary injunction. See Hohe v. Casey, 704 F.Supp. 581 (M.D.Pa.1988). On September 15th, after the hearing, the district court lifted the restraining order and denied plaintiffs' request for a preliminary injunction. The plaintiffs appealed that order to this court, which affirmed on the ground that plaintiffs failed to show irreparable harm. See Hohe v. Casey, 868 F.2d 69, 70 (3d Cir.1989).

Subsequent to the denial of their motion for a preliminary injunction, plaintiffs amended their complaint and sought class certification. On January 18, 1989, the court ordered that

the action shall be maintained as a class action under Fed.R.Civ.P. 23(b)(1)(A) and 23(b)(2) by the plaintiffs on behalf of class comprised of the plaintiffs and all other individuals employed since August 16, 1988, by the Commonwealth of Pennsylvania, or its departments, boards, commissions, agencies, authorities, systems and other instrumentalities, who are represented exclusively for purposes of collective bargaining by Council 13 ... and who are not members of said labor organization.

Hohe v. Casey, 128 F.R.D. 68, 72 (M.D.Pa.1989).

In April 1989, Council 13 moved for summary judgment, the Commonwealth moved for judgment on the pleadings, and plaintiffs for partial summary judgment. In ruling on these motions, the district court determined that the "Act 84 can be applied constitutionally, and that for the most part, the fair share fee deduction program implemented by AFSCME Council 13 comports with" the constitutional requirements set forth in Chicago Teachers Union, Local No. 1 v. Hudson, 475 U.S. 292, 106 S.Ct. 1066, 89 L.Ed.2d 232 (1986). Nonetheless, it denied all of the parties' motions on the ground that there existed a genuine issue of material fact as to whether the financial data set forth in the notice sent to nonmembers in August 1988 had been properly verified as required by Hudson. The Court ordered that a hearing be held "to receive evidence on the sole remaining issue remaining in this matter: whether the expense figures for AFSCME International have been verified by an independent auditor."

On December 11, 1989, after the hearing, the district court concluded that "the breakdown of chargeable and non-chargeable expenses [for 1988-89] ... were not subjected to verification by an independent auditor as required by Hudson." 727 F.Supp. 163, 166 It further noted "that Hudson was violated because AFSCME International's Special Reports were prepared after the notices to nonmembers were sent." For this constitutional violation, the district court awarded plaintiffs nominal damages in the amount of $1.00 apiece. The court also concluded that it could not, at that time, order a rebate of any of the collected fees because even though the breakdown of expenses was not verified, "[t]he figures may indeed be accurate." Id. at 168. It issued an order permitting defendants and plaintiffs to submit audits and evidentiary materials for the purpose of determining whether the expense figures contained in the notice were in fact accurate. Id. at 169.

After reviewing the submissions of the parties, the district court accepted the conclusion of the defendants' auditor that "the schedules of expenses ... present fairly, in all material respects, the expenses ... and the allocation between chargeable and nonchargeables expenses...." App. at 1301. It then determined that plaintiffs were only entitled to the nominal damages of $1.00 apiece. 727 F.Supp. 163.

In response to plaintiffs' motion for the entry of final judgment, the district court entered final judgment consistent with its prior rulings. Plaintiffs filed a timely notice of appeal from that order.

The district court had jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1343 (1988). This court has jurisdiction pursuant to 28 U.S.C. § 1291 (1988). Our review of all issues is plenary.

II. DISCUSSION
A. The Facial Constitutional Challenges to the Act

We must decide facial federal constitutional challenges by plaintiffs to subsections (d) and (g) of the Act.

1. The Commonwealth's Obligation to Deduct Fees

Plaintiffs challenge the last sentence in § 575(d) on the ground that it requires public employers to make unconstitutional deductions of fair share fees. To analyze this contention, it is necessary to place the challenged sentence within the relevant statutory context. Thus, we set forth both subsections (c) and (d) of § 575.

(c) To implement fair share agreements ... the exclusive representative shall provide the public employer with the name of each nonmember who is obligated to pay a fair share fee, the amount of the fee that he or she is obligated to pay and a reasonable schedule for deducting said amount from the salary and wages of such nonmember. The public employer shall deduct the fee in accordance with said schedule and promptly transmit the amount deducted to the exclusive representative.

(d) As a precondition to the collection of fair share fees, the exclusive representative shall establish and maintain a full and fair procedure, consistent with constitutional...

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