Air Line Pilots Ass'n, Intern. v. Texas Intern. Airlines, Inc., 850

• Decision Date: 24 August 1981
• Docket Number: No. 850,D,850
• Citation: 656 F.2d 16
• Parties: 107 L.R.R.M. (BNA) 3185, 92 Lab.Cas. P 12,946 AIR LINE PILOTS ASSOCIATION, INTERNATIONAL, Plaintiff-Appellant, v. TEXAS INTERNATIONAL AIRLINES, INC., New York Air Lines, Inc., and Texas Air Corp., Defendants-Appellees. ocket 80-9102.
• Court: U.S. Court of Appeals — Second Circuit

Page 16

656 F.2d 16

107 L.R.R.M. (BNA) 3185, 92 Lab.Cas. P 12,946

AIR LINE PILOTS ASSOCIATION, INTERNATIONAL, Plaintiff-Appellant, v. TEXAS INTERNATIONAL AIRLINES, INC., New York Air Lines Inc., and Texas Air Corp., Defendants-Appellees.

No. 850, Docket 80-9102.

United States Court of Appeals Second Circuit.

Argued March 23, 1981.

Decided July 29, 1981.

As Amended Aug. 24, 1981.

Michael E. Abram, New York City (Robert S. Savelson, Cohen, Weiss and Simon, New York City, of counsel), for plaintiff-appellant.

Marvin E. Frankel, New York City (Saul G. Kramer, Joseph R. Knock, Proskauer Rose Goetz & Mendelsohn, New York City, of counsel), for defendants-appellees.

Before OAKES and MESKILL, Circuit Judges, and SAND, District Judge. ^*

MESKILL, Circuit Judge:

The plaintiff, Air Line Pilots Association, International (ALPA), appeals from a judgment dismissing its complaint for lack of subject matter jurisdiction. Air Line Pilots Association v. Texas International Airlines, 502 F.Supp. 423 (S.D.N.Y.1980) (Nickerson, J.). The complaint alleged various substantive violations of the Railway Labor Act (RLA), 45 U.S.C. §§ 151-188 (1976), ¹ and sought damages and injunctive relief. Judge Nickerson found that since the complaint raised a "representation dispute" under section 2 Ninth of the RLA, 45 U.S.C. § 152 Ninth, the action was not justiciable. We affirm.

BACKGROUND

The allegations of the complaint, which must be regarded as true for the purposes of this appeal, reveal the following facts. ALPA, a widely recognized union among airline pilots, ² is the collective bargaining representative for more than 400 pilots employed by Texas International Airlines, Inc. (TXI). Prior to February 1980, TXI was directly controlled by Jet Capital Corporation. In February 1980, a corporate restructuring took place in which a new corporation, New York Airlines, Inc. (New York Air) was formed to serve the New York-Washington, D.C. route. Under the restructuring, Jet Capital Corp. formed a holding company, Texas Air Corporation (Texas Air), of which both New York Air and TXI became wholly owned subsidiaries. New York Air then filed an application with the Civil Aeronautics Board (CAB) for a certificate of public convenience and necessity to operate air passenger service between, among other cities, New York and Washington. On December 11, 1980, the CAB approved New York Air's application, New York Air Lines, Inc., CAB Order No. 80-12-57, and regular service began a week later. ³

Upon learning of New York Air's application to the CAB, ALPA notified New York Air and TXI on September 10, 1980 of ALPA's position that "the proposed new routes, whether operated through certificates issued to Texas International or New York Air, constituted flying which must be performed by the Texas International pilots under the pilot collective bargaining agreement." (A. 9). New York Air, however, entered into individual employment contracts with the newly hired pilots and declined to recognize ALPA as their representative.

ALPA contends that the corporate restructuring which resulted in the creation of New York Air was part of a plan by TXI to defeat the existing collective bargaining relationship between ALPA and the TXI pilots. The complaint alleges that, in fact, TXI "has ... directed and controlled New York Air through the officers, directors, management and resources of Texas International and Texas Air Corp." (A. 8). Specifically, ALPA charges that TXI has transferred to New York Air valuable landing slots at airports in New York and Washington, leased TXI aircraft to New York Air, and provided New York Air "with extensive and comprehensive management ALPA charges that the foregoing conduct violates TXI's statutory duty (1) to "treat with" ALPA as the exclusive representative of TXI's pilots, § 2 Ninth; (2) to maintain the collective bargaining agreement, § 2 First; (3) to allow representatives to be designated without interference, influence or coercion, § 2 Third; (4) to refrain from interference in the organization of the employees, § 2 Fourth; and (5) to refrain from attempting to unilaterally change rates of pay, rules, and working conditions, § 2 Seventh, § 6. The complaint requested an order requiring TXI to deal exclusively with ALPA, to cease hiring New York Air pilots except in accordance with the ALPA agreement, to cease operating New York Air except in accordance with the ALPA agreement, and to cease its efforts to nullify the collective bargaining relationship with ALPA.

employee, technical and financial resources, direction and control." (A. 7-8). The purpose of this corporate maneuvering, ALPA alleges, is to deprive ALPA of its representative status, to deprive the TXI pilots of their collective bargaining rights, and to frustrate the rights of TXI pilots to organize and collectively bargain.

In ruling on the defendants' motion to dismiss, the district court acknowledged that in a proper case the courts may enforce a carrier's duty to bargain with a duly designated representative. Judge Nickerson found, however, that in this case there were doubts as to who was the legitimate representative of the New York Air pilots and that under § 2 Ninth the exclusive forum for the resolution of those doubts was the National Mediation Board (NMB). ⁴ The court emphasized that there was no allegation that "the work of the Texas International pilots is to be terminated or curtailed," 502 F.Supp. at 424, nor that the "Texas International activities are being abandoned," id. at 425. Rather, the pervasive question identified by the district court was whether New York Air and TXI should, because of their special relationship, be treated as a single carrier, even though the two airlines were "separate corporations serving different areas and flying over different routes." Id. While acknowledging that it was required to accept the truth of the allegations of the complaint, the district court pointed out that many of ALPA's conclusory allegations assumed the very question which the district court refused to decide. Having found that a representation dispute appeared on the face of the complaint, the district court concluded that it lacked subject matter jurisdiction and therefore dismissed the action. ALPA now appeals.

DISCUSSION

This case is neither a pure representation dispute under § 2 Ninth nor a pure interference claim under § 2 Third and Fourth; rather, the problems raised here "fall( ) between two stools." Brotherhood of Locomotive Firemen & Enginemen v. NMB, 410 F.2d 1025, 1034 (D.C.Cir.), cert. denied, 396 U.S. 878, 90 S.Ct 149, 24 L.Ed.2d 136 (1969) (Burger, J., concurring). Decisionmaking at either end of the spectrum is considerably simpler than in the hazy zone in the middle. We do not doubt, for example, that TXI itself could not commence passenger service between New York and Washington without complying with its collective bargaining agreement with ALPA. See Virginian Railway v. System Federation No. 40, 300 U.S. 515, 57 S.Ct. 592, 81 L.Ed. 789 (1937) (requiring carrier to treat with the certified representative of a given craft or class of employees). Nor could TXI permissibly transfer existing business flown by ALPA pilots to a newly formed corporate alter ego for the purpose of displacing the work of ALPA pilots. Cf. Ruby v. TACA International, Airlines, 439 F.2d 1359 (5th Cir. 1971) (where existing ALPA pilots were forced to relocate to a new headquarters in a foreign country in which bargaining agreement would be unenforceable, carrier's conduct raised a major dispute and violated § 2 Fourth). On the other hand, there are certainly situations in which a carrier or its parent could permissibly form a separate and fully independent company which would hire new pilots to fly separate routes neither flown by nor even certificated to the pre-existing carrier. In such a case, any attempt by the union of the pre-existing carrier to force recognition by the new corporation would raise a representation dispute under § 2 Ninth and would be within the exclusive jurisdiction of the NMB. Cf. Summit Airlines v. Teamsters Local Union No. 295, 628 F.2d 787 (2d Cir. 1980) (union could not, even in absence of competing union, bypass § 2 Ninth and use economic coercion to force recognition where its representative status was in doubt). In the present case, the complaint admits that TXI had not been flying the New York-Washington route, ⁵ that the work of TXI pilots is not being terminated or curtailed, and that the activities of TXI are not being abandoned, but alleges that TXI is authorized to fly the new route and is using New York Air to do so. ALPA argues that in light of TXI's incestuous relationship with its sister company, all work of New York Air must be performed pursuant to the collective bargaining agreement and applicable seniority provisions. The question, according to ALPA, is not whether ALPA is to be designated the new representative of the New York Air pilots, but whether TXI may, through establishment of a company it controls, evade the obligations of its collective bargaining agreement with ALPA. This argument, of course, simply assumes that which the district court was unwilling to decide that TXI and New York Air should be treated as a single carrier. Although the question is a close one, we agree with the district court that this issue is committed to the jurisdiction of the NMB.

A. Judicial Intervention in the RLA

The role of the courts in enforcing substantive obligations under the RLA is circumscribed by the Act's unique history and dispute-resolution framework. The history of the RLA was recently recounted by this Court in Summit Airlines v. Teamsters Local Union No. 295, supra, and need not be rehashed here. For present purposes, it is sufficient to state that the Act was the product of agreement between the carriers and the unions, based on extensive negotiation and compromise as well as decades of...