Beardsly v. Chicago & North Western Transp. Co.

• Court: U.S. Court of Appeals — Eighth Circuit
• Writing for the Court: Before HEANEY, BOWMAN and WOLLMAN; HEANEY; Two former Rock Island employees
• Citation: Beardsly v. Chicago & North Western Transp. Co., 836 F.2d 1493 (8th Cir. 1988)
• Decision Date: 08 January 1988
• Docket Number: 86-1372,86-1370,Nos. 86-1369,s. 86-1369
• Parties: 127 L.R.R.M. (BNA) 2313 L. Lee BEARDSLY, Appellant, v. CHICAGO & NORTH WESTERN TRANSPORTATION CO., et al., Appellees. Francis E. AMIOT, Appellant, v. CHICAGO & NORTH WESTERN TRANSPORTATION CO., et al., Appellees. John E. REECE, et al., Appellants, v. CHICAGO & NORTH WESTERN TRANSPORTATION CO., et al., Appellees. Jack L. CHAMBERS, et al., Appellants, v. CHICAGO AND NORTH WESTERN TRANSPORTATION COMPANY, et al., Appellees. Roger L. SWIFT; Oscar D. Overton; W.R. Urton; Robert W. Luth; Mark R. Pomery; David G. Dickey; Terry B. Turvold and Clyde R. Thomas, Appellants, v. CHICAGO AND NORTH WESTERN TRANSPORTATION COMPANY; United Transportation Union, an unincorporated labor organization; and The Brotherhood of Locomotive Engineers, an unincorporated labor organization, Appellees. Harold L. KING; James L. Knox; Steven Arthur Newton; George R. Etherton; Larry L. Williams; John F. Keith; and Joseph A. Rush, Appellants, v. CHICAGO AND NORTH WESTERN TRANSPORTATION COMPANY and The United Transportation Union, an unincorporated labor organization, Appellees. Vane NEWTON; Robert R. Bailey; Wayne A. Moore; Robert L. Duncan; Harold E. Johnson; Donald L. Kidd, Sr.; H.L. Kidd, Jr.; B.J. Rude; Max A. Eads; Jack E. Brown; Milton E. Capps; Wilbur Stanton; J.W. Burke, Jr.; E.D. Snyder; Daniel V. Middour; Donald P. McCaleb; Sam H. Dean; Donald E. Bisgaard; Robert W. Shaner; LaDon E. Crane; Roger L. Rothamel; Arnold M. Scheel; Frank M. Ramey; A.M. McQuade; Lloyd G. Andrews; Richard D. Thorsland; John R. Vincent; Stephen R. Early; Leo T. Seehan; and Richard A. Nitcher; John E. Beghtol; Dennis E. Chaplin; Paul W. Strawn; Max R. Williams; David Yackle; Francis E. Amiot; James F. Ramsey; Allan P. Sherling; Jerry E. Payne; Richard A. Clark; Kenneth W. Brevig; Stephen D. Rosentangle and William H. Rosentangle, Appellants, v. CHICAGO AND NORTHWESTERN TRANSPORTATION COMPANY; United Transportation Union, an Unincorporated Labor Organization; and Brotherhood of Locomotive Engineers and Unincorporated

Page 1493

836 F.2d 1493

127 L.R.R.M. (BNA) 2313

L. Lee BEARDSLY, Appellant, v. CHICAGO & NORTH WESTERN TRANSPORTATION CO., et al., Appellees.

Francis E. AMIOT, Appellant, v. CHICAGO & NORTH WESTERN TRANSPORTATION CO., et al., Appellees.

John E. REECE, et al., Appellants, v. CHICAGO & NORTH WESTERN TRANSPORTATION CO., et al., Appellees.

Jack L. CHAMBERS, et al., Appellants, v. CHICAGO AND NORTH WESTERN TRANSPORTATION COMPANY, et al., Appellees.

Roger L. SWIFT; Oscar D. Overton; W.R. Urton; Robert W.

Luth; Mark R. Pomery; David G. Dickey; Terry B.

Turvold and Clyde R. Thomas, Appellants, v. CHICAGO AND NORTH WESTERN TRANSPORTATION COMPANY; United

Transportation Union, an unincorporated labor organization;

and The Brotherhood of Locomotive Engineers, an

unincorporated labor organization, Appellees.

Harold L. KING; James L. Knox; Steven Arthur Newton;

George R. Etherton; Larry L. Williams; John F.

Keith; and Joseph A. Rush, Appellants, v. CHICAGO AND NORTH WESTERN TRANSPORTATION COMPANY and The

United Transportation Union, an unincorporated

labor organization, Appellees.

Vane NEWTON; Robert R. Bailey; Wayne A. Moore; Robert L.

Duncan; Harold E. Johnson; Donald L. Kidd, Sr.; H.L.

Kidd, Jr.; B.J. Rude; Max A. Eads; Jack E. Brown; Milton

E. Capps; Wilbur Stanton; J.W. Burke, Jr.; E.D. Snyder;

Daniel V. Middour; Donald P. McCaleb; Sam H. Dean; Donald

E. Bisgaard; Robert W. Shaner; LaDon E. Crane; Roger L.

Rothamel; Arnold M. Scheel; Frank M. Ramey; A.M. McQuade;

Lloyd G. Andrews; Richard D. Thorsland; John R. Vincent;

Stephen R. Early; Leo T. Seehan; and Richard A. Nitcher;

John E. Beghtol; Dennis E. Chaplin; Paul W. Strawn; Max

R. Williams; David Yackle; Francis E. Amiot; James F.

Ramsey; Allan P. Sherling; Jerry E. Payne; Richard A.

Clark; Kenneth W. Brevig; Stephen D. Rosentangle and William H. Rosentangle, Appellants, v. CHICAGO AND NORTHWESTERN TRANSPORTATION COMPANY; United

Transportation Union, an Unincorporated Labor Organization;

and Brotherhood of Locomotive Engineers and Unincorporated

Labor Organization, Appellees.

Angeline V. BOLL, Robert J. Tollakson and Dennis L. Stowe, Appellants, v. CHICAGO AND NORTH WESTERN TRANSPORTATION COMPANY, and Brotherhood of Railway, Airline and Steamship Clerks,

Freight Handlers, Express and Station Employees, an

unincorporated labor organization, Appellees.

Nos. 86-1369, 86-1370, 86-1372 to 86-1374, 86-1950 and 87-1325.

United States Court of Appeals Eighth Circuit.

Submitted Aug. 31, 1987.

Decided Jan. 8, 1988.

Bruce Stolz, Des Moines, Iowa, for appellants.

Norton Newborn, Cleveland, Ohio, Ralph J. Moore, Washington, D.C., and Harold A. Ross, Cleveland, Ohio, for appellees.

Before HEANEY, BOWMAN and WOLLMAN, Circuit Judges.

HEANEY, Circuit Judge.

I. OVERVIEW

One hundred fifty-eight former employees of the Chicago, Rock Island and Pacific Railroad (Rock Island or Rock Island Railroad) appeal from decisions of the United States District Court for the Southern District of Iowa dismissing or denying their claims against the Chicago & Northwestern Transportation Co. (CNW) and four railroad labor organizations. ¹ The suits allege violations of a labor protective agreement and a United States statute, both designed to protect the job status of the former Rock Island employees.

We affirm the district court insofar as it dismissed several of the actions for lack of jurisdiction. We reverse the district court's denial of appellants' request to vacate an arbitration decision between the CNW and the United Transportation Union (UTU) regarding former Rock Island ground service employees. We find that the October 22, 1980 and February 16, 1982 seniority implementing agreements are invalid and direct that they be renegotiated. Finally, we hold the remaining employees have a right to arbitration, subject to the right of the CNW and the appellee unions to assert the defense of laches.

II. FACTUAL BACKGROUND

A. Attempted Reorganization, Interim Operation and Purchase of the Rock Island Railroad

In 1975, the Rock Island Railroad commenced reorganization proceedings. These efforts were unsuccessful. In September of 1979, the Interstate Commerce Commission (ICC) concluded that Rock Island had insufficient cash assets to continue its operations "in the face of national transportation requirements." On March 18, 1980, the ICC granted the CNW authority to conduct temporary operations over certain Rock Island lines from March 24 until May 31, 1980. ² The ICC subsequently authorized the CNW to continue providing interim service over those lines until June 20, 1983, at which time a United States Bankruptcy Court approved the sale by the Rock Island trustee to the CNW of the lines upon which it had been conducting interim service.

B. The March 4th Agreement

On March 4, 1980, thirteen railroads who were operating or contemplating operations on Rock Island lines, including the CNW, entered into a labor protective agreement ³ with national representatives of rail labor organizations, including the national representatives of appellee unions involved in the present action.

The March 4th Agreement was designed to ease a potentially troublesome transition. The acquiring railroad agreed to make accommodations in terms of providing rights of first hire and seniority to the employees of the acquired company. In exchange, the international unions agreed to assure labor peace during the transition. Specifically, the stated purpose of this agreement was to provide:

a fair, equitable and complete arrangement for protection of ... Rock Island employees taken into the employ of interim service operators and purchasing carriers signatory hereto and to enable the interim service operator or purchasing carrier to be operated in the most efficient manner, as set forth herein, immediately upon authorization for such operation.

March 4th Agreement at 1.

Article II of the Agreement provides that the purchasing carrier shall determine by craft its necessary additional manpower requirements "due to its taking over ... [the] Rock Island lines." Id. at 3. The acquiring carrier further agreed to provide a detailed explanation of these needs, to "discuss" its requirements with representatives of the crafts employed by both the acquiring and acquired railroad, and to extend to employees of the acquired railroad the right of first hire in all work stemming from the acquisition. Id. This right of first hire was to accrue to employees in order of their seniority. ⁴

Article II, section 9, of the Agreement sets forth procedures to determine job seniority for former Rock Island employees hired by the CNW. It states:

[A]greements will be reached on each purchasing carrier concerning the manner in which seniority will be allocated in filling additional job assignments, between the purchasing carrier's employees and the bankrupt carrier employees hired by the purchasing carrier.

C. The Rock Island Railroad Transition and Employee Assistance Act--RITEA

On May 30, 1980, the President signed into law the Rock Island Railroad Transition and Employee Assistance Act (RITEA) Pub.L. No. 96-254, 94 Stat. 399 (1980) (codified as amended at 45 U.S.C. Sec. 1001 et seq.). The purpose of this act was twofold: (1) to protect the interests of former Rock Island employees and (2) to protect the railroads against labor strife and ensure continued operation of the lines formerly controlled by the Rock Island railroad. ⁵

Section 105 of the Act, 45 U.S.C. Sec. 1004, entitled "Railroad Hiring," provides a broader right of first hire than the March 4th Agreement. Where the March 4th Agreement limits the right of first hire to work stemming from the acquisition of the Rock Island, RITEA provides a blanket right of first hire to former Rock Island employees. ⁶ Specifically, it states that former employees of the Rock Island:

shall, unless found to be less qualified than other applicants, have the first right of hire by any other rail carrier that is subject to regulation by the [ICC] for any vacancy that is not covered by [an affirmative action plan].

45 U.S.C. Sec. 1004 (emphasis added).

On January 14, 1983, the arbitration provision of the Regional Rail Reorganization Act, 45 U.S.C. Sec. 797c(g), was amended to subject disputes regarding the right of first hire under RITEA to mandatory arbitration. See Rail Safety and Service Improvement Act of 1982, Pub.L. No. 97-468, Sec. 235, 96 Stat. 2543, 2547 (1983). Prior to this time, an action could theoretically be brought in federal court to enforce this right. See Brotherhood of Locomotive Engineers v. Burlington Northern, 580 F.Supp. 797 (D.Colo.1984).

D. Propriety of Implementing Agreements Negotiated Under the March 4th Labor Protective Agreement

1. Factual Background

To understand appellants' claims concerning the validity of the implementing agreements negotiated under the authority of the March 4th labor protective agreement, it is important to take note of certain circumstances surrounding the negotiation of these agreements. Specifically, the effect of the closing and consolidation of local unions must be understood, as well as obligations imposed on the negotiating unions by their own constitutions.

a. National Unions Close Down Local Rock Island Locals

Shortly after the March 4th Agreement and RITEA went into effect, the international unions here involved closed down or consolidated many of the locals serving former Rock Island employees. They maintain these closings or consolidations were an economic necessity because members had ceased paying dues. See Affidavit of Robert L. Hart, 5 Joint Appendix 1057, 1057-58. The appellants maintain that the closing or consolidation of the locals resulted from a conspiracy among the international unions, the CNW, and the local unions representing CNW employees to undermine the bargaining strength of the former Rock Island employees. See generally, 1 Joint Appendix 16-130. As evidence of this, they note that local union officials...