Bache v. American Telephone & Telegraph

• Decision Date: 23 March 1988
• Docket Number: Nos. 87-3007,87-3327,s. 87-3007
• Citation: 840 F.2d 283
• Parties: 130 L.R.R.M. (BNA) 2129, 108 Lab.Cas. P 10,407 Robert A. BACHE, Jr., et al., Plaintiffs-Appellants, v. AMERICAN TELEPHONE AND TELEGRAPH, etc., et al., Defendants-Appellees. Jo B. BANKSTON, et al., Plaintiffs-Appellants, v. AMERICAN TELEPHONE AND TELEGRAPH CO., et al., Defendants-Appellees. Carolyn CAREY, Plaintiff-Appellant, v. AMERICAN TELEPHONE AND TELEGRAPH INFORMATION SYSTEMS, INC., et al., Defendants- Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 283

840 F.2d 283

130 L.R.R.M. (BNA) 2129, 108 Lab.Cas. P 10,407

Robert A. BACHE, Jr., et al., Plaintiffs-Appellants, v. AMERICAN TELEPHONE AND TELEGRAPH, etc., et al.,

Defendants-Appellees.

Jo B. BANKSTON, et al., Plaintiffs-Appellants, v. AMERICAN TELEPHONE AND TELEGRAPH CO., et al., Defendants-Appellees.

Carolyn CAREY, Plaintiff-Appellant,

v.

AMERICAN TELEPHONE AND TELEGRAPH INFORMATION SYSTEMS, INC.,

et al., Defendants- Appellees.

Nos. 87-3007, 87-3327.

United States Court of Appeals Fifth Circuit.

March 23, 1988.

Rehearing Denied in No. 87-3007 May 11, 1988.

Walter J. Leger, Jr., Franklin G. Shaw, New Orleans, La., for plaintiffs-appellants.

Sylvan J. Steinberg, New Orleans, La., for Bankston, et al.

T. George Delsa, New Orleans, La., for Carey.

Robert K. McCalla, Keith M. Pyburn, Jr., McCalla, Thompson, Pyburn and Ridley, New Orleans, La., for American Tel. & Tel. Co.

George W. Byrne, Jr., Wayne T. McGraw, Sutherland & Juge, New Orleans, La., for South Central Bell.

John L. Quinn, Birmingham, Ala., Jerry L. Gardner, Jr., Louis L. Robein, Jr., Metairie, La., for Communications Workers of America.

Appeals from the United States District Court for the Eastern District of Louisiana.

Before KING ^* and DAVIS, Circuit Judges, and FELDMAN ^**, District Judge.

KING, Circuit Judge:

Plaintiffs appeal from adverse summary judgments in suits against their former employers for breach of a collective bargaining agreement and against the labor union for breach of the duty of fair representation. Because the plaintiffs failed to exhaust grievance procedures or to make a sufficient showing of unfair representation, the district court properly entered summary judgment against them, and thus we affirm.

I.

This is a consolidated appeal of cases brought by former employees of South Central Bell Telephone Company ("SCB") and American Telephone and Telegraph Information Systems, Inc. ("ATTIS"), whose exclusive bargaining representative was Communication Workers of America, AFL-CIO ("CWA"). The suits, originally filed in state court, alleged breaches of contract and fraudulent misrepresentation by the former employers and the labor union in connection with employment layoffs during the fall of 1984 and the spring of 1986. The defendants asserted that section 301 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. Sec. 185, governed the claims and removed the cases to the United States District Court for the Eastern District of Louisiana. The district court subsequently granted the defendants' motions for summary judgment, and the plaintiffs timely appealed from the final judgments dismissing their suits.

The relevant facts presented to the district court are as follows. On January 1, 1984, American Telephone and Telegraph Company ("AT & T") divested itself of the Bell Operating Companies, including SCB, pursuant to court order in federal antitrust litigation. See United States v. American Tel. & Tel. Co., 552 F.Supp. 131 (D.D.C.1982), aff'd, 460 U.S. 1001, 103 S.Ct. 1240, 75 L.Ed.2d 472 (1983). In preparing a plan of reorganization, AT & T negotiated with labor unions concerning the continued employment of union members, and on March 26, 1982, AT & T and CWA executed an Amended Memorandum of Agreement ("AMOA"). The AMOA provided, among other things, that the collective bargaining agreement in effect at SCB would continue to apply to employees who transferred from SCB to a new AT & T subsidiary or affiliate. The AMOA also contained provisions concerning the employment rights of transferred employees; these provisions became the subject of later dispute between ATTIS and CWA and established the basis for the present suits.

In the fall of 1983, all of the plaintiffs in these cases were SCB employees with substantial seniority, and on or about January 1, 1984, all transferred from SCB to ATTIS (then named American Bell Company). The plaintiffs state that they transferred because company and union representatives assured them of job security at ATTIS, because various informational materials represented that the AMOA guaranteed their continued employment for seven years after transfer, and because SCB told them that the type of work they were doing would be performed at ATTIS in the future. During the fall of 1984, however, ATTIS reduced its workforce and laid off or downgraded the plaintiffs from the first suit (Bache ). In response, CWA processed grievances on behalf of the Bache plaintiffs, which ATTIS denied, but did not proceed to arbitration. CWA states that it made this decision because it determined that the layoffs resulted from economic conditions and thus were contractually permissible.

In August of 1985, ATTIS announced a nationwide elimination of jobs affecting thousands of CWA-represented employees. In response, CWA filed an unfair labor practice charge against ATTIS with the National Labor Relations Board ("NLRB") on October 25, 1985. CWA complained that the 1985 layoffs resulted from divestiture-related reorganization and therefore violated the AMOA. To support its claim, CWA alleged that ATTIS' economic justification for the layoffs was pretextual because ATTIS was assigning overtime work to, and contracting out work of, targeted work groups in many locations. On January 29, 1986, the NLRB Regional Director rejected CWA's position that the AMOA imposed restrictions on ATTIS' ability to reduce its workforce and dismissed the charge. CWA appealed the adverse ruling to the NLRB, which affirmed the decision on April 21, 1986.

ATTIS laid off the plaintiffs from the second suit (Bankston ) in March 1986. No grievances were filed to protest these layoffs, but the Bankston plaintiffs contend that this omission resulted from CWA's refusal to represent them in the grievance process. The Bankston plaintiffs also assert that they have been denied preferential rehiring rights provided by the AMOA. They have not grieved these claims but similarly contend that CWA has refused to represent them in this regard.

On October 30, 1986, the district court entered summary judgment in Bache on the ground that there were no genuine issues of material fact concerning the plaintiffs' claims under section 301 of the LMRA. ¹ Relying on Sturgeon v. Airborne Freight Corp., 778 F.2d 1154, 1158 (5th Cir.1985), the court held that to prevail against any of the defendants, the plaintiffs must prove that their discharges violated the labor contract and that the union breached its duty to represent them fairly. The court found that the terms of the applicable collective bargaining agreement and the AMOA permitted ATTIS to layoff and downgrade transferred employees and that, therefore, there was no breach of contract as a matter of law. The court also found that the plaintiffs offered no evidence that CWA acted in bad faith, with malice, or in a discriminatory manner when it determined that arbitration was unwarranted and thus they failed to demonstrate unfair representation. Accordingly, the court held that the plaintiffs were bound by the results of the grievance proceedings. In Bankston, the district court granted summary judgment on the basis of its previous decision in Bache.

II.

On appeal, the plaintiffs contend that summary judgment was improper because factual disputes exist concerning (1) whether the AMOA guaranteed them seven years of employment, (2) whether the law required them to exhaust contractual remedies under the circumstances, and (3) if so, whether CWA's conduct excused their failure to complete the grievance process. The plaintiffs forcefully argue that facially inconsistent provisions of the AMOA--for example, one section stating that "no transferred employee shall be deprived of his or her employment" for a seven-year period following transfer and another providing that transferred employees laid off during the seven-year period have preferential rights of rehire--rendered the contract ambiguous and that extrinsic evidence they presented in response to the defendants' summary judgment motions created factual issues of contractual interpretation. They also urge us to consider whether an employer and union who make affirmative representations to employees concerning the contract's meaning should be estopped from later asserting another interpretation. We conclude, however, that we need not reach these issues because the plaintiffs' failure to establish an essential element of their claims--that the union breached its duty of fair representation--is dispositive of this appeal.

Under the Federal Rules of Civil Procedure, summary judgment is proper if, when viewing the evidence most favorably to the nonmoving party, "the pleadings [and other documentary evidence on file] show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). See Russell v. Harrison, 736 F.2d 283, 287 (5th Cir.1984). In reviewing a summary judgment, we apply the same standard that governs the district court's determination. Russell, 736 F.2d at 287. Recent Supreme Court pronouncements also guide our inquiry:

In our view, the plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial. In such a situation, there can be "no genuine issue as to any material fact," since a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial.

Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986). Thus to determine which factual issues are material, we must first examine the substantive law that governs the case, and to determine if an issue of material fact is genuine, we must then decide whether ...