CARPENTERS, ETC., PA. v. UNITED CONTR. ASS'N OF OHIO, INC.

• Decision Date: 14 September 1973
• Docket Number: No. 72-2209.,72-2209.
• Citation: 484 F.2d 119
• Parties: CARPENTERS DISTRICT COUNCIL OF MAHONING AND TRUMBULL COUTIES, OHIO AND MERCER COUNTY, PENNSYLVANIA, et al., Plaintiffs-Appellants, v. UNITED CONTRACTORS ASSOCIATION OF OHIO, INC., et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

484 F.2d 119 (1973)

CARPENTERS DISTRICT COUNCIL OF MAHONING AND TRUMBULL COUTIES, OHIO AND MERCER COUNTY, PENNSYLVANIA, et al., Plaintiffs-Appellants, v. UNITED CONTRACTORS ASSOCIATION OF OHIO, INC., et al., Defendants-Appellees.

No. 72-2209.

United States Court of Appeals, Sixth Circuit.

Argued April 9, 1973.

Decided September 14, 1973.

Eugene Green, Green, Schiavoni, Murphy & Haines, Youngstown, Ohio, on brief, for plaintiffs-appellants.

Eldon S. Wright, Louis M. Davies, Youngstown, Ohio, Burton C. Duerring, Pittsburgh, Pa., Stephen J. Knerly, Cleveland, Ohio, for defendants-appellees; Jay Tims, Harrington, Huxley & Smith, Youngstown, Ohio, on brief.

Before WEICK and PECK, Circuit Judges, and CECIL, Senior Circuit Judge.

CECIL, Senior Circuit Judge.

The plaintiffs herein appeal from an order of the United States District Court for the Northern District of Ohio, Eastern Division, dismissing their petition.

The plaintiffs are Carpenters District Council of Mahoning and Trumbull Counties, Ohio and Mercer County, Pennsylvania, a labor organization composed of labor unions on whose behalf it represents carpenters in the building construction trades in the states of Ohio and Pennsylvania for collective bargaining purposes and ten other local labor unions affiliated with AFL-CIO.

The action is against sixty-one defendants including United Contractors Association of Ohio, Inc., and Associated Trades and Crafts. It is alleged that the United Contractors Association, is an Ohio corporation purporting to represent, for trade association and collective bargaining purposes, employers engaged in the construction industry in the states of Ohio and Pennsylvania. Associated Trades and Crafts is International Construction Union Local No. 1 and Local No. 2. It is alleged that it purports to represent, for collective bargaining purposes, employees employed in the construction industry in Ohio and Pennsylvania.

Three of the named defendants are trustees of the United Contractors Association, four are officers of the Associated Trades and Crafts International Construction Union and one is Business Agent of the Trades and Crafts Union. Other defendants are individuals and firms, members of the United Contractors Association.

The thrust of the complaint is that the defendant individuals have entered into a conspiracy and created combinations for the purpose of restraining trade and interstate commerce and eliminating competition in the construction industry, with the object of preventing the plaintiff unions from representing, for collective bargaining purposes, the employees of the individual defendant employers. Briefly stated, it is charged that the conspiracy is accomplished by the individual defendants organizing the Defendant United Contractors Association of Ohio, Inc., and the Defendant Associated Trades and Crafts International Construction Union.

The purpose of the Contractors Association is to act as bargaining representative of its members. It is alleged that the Associated Trades and Craft Union purports to be a labor organization for employees employed in the construction industry. Funds to support this Union are supplied by the employers in the guise of dues for the employees who are compelled by the employers to become and maintain membership in the Union. It is further claimed that a sham collective bargaining agreement was executed between the Contractors Association and the Union. A distinctive feature of these organizations is that membership in the Contractors Association automatically entitles its members to membership in the Trades and Craft Union. Thus through this dual membership the individual defendant employers are able to control the activities of both organizations. The plaintiffs conclude that these arrangements are combinations in restraint of trade in violation of the Sherman and Clayton Anti-trust Acts.

The defendant Associated Trades and Crafts International Construction Union moved to dismiss the petition on the grounds that the defendants were immune from prosecution under federal anti-trust laws.

"Nothing contained in the antitrust laws shall be construed to forbid the existence and operation of labor, * * * organizations, instituted for the purposes of mutual help, * * *."

Sec. 17, Title 15, U.S.C. (See also Secs. 52 and 102, Title 29, U.S.C.) And that all allegations of the complaint allege violations of the Labor Management Relations Act.

At the time this case was pending in the District Court a similar case was pending in the United States District Court for the Western District of Pennsylvania. The district judge sustained defendants' motions to dismiss. International Association of H. & F. I. & A. W. v. United Contractors Association, 331 F.Supp. 1298. The district judge of the Northern District of Ohio likewise sustained a motion to dismiss on authority of the opinion of the district judge in the above entitled case. The Court of Appeals for the Third Circuit vacated the order of the District Court and remanded the case with instructions to certify labor issues to the Labor Board. Upon receiving a finding of facts from the Labor Board the District Court would proceed to determine the antitrust issues. International Association of Heat and Frost Insulators and Asbestos Workers, etc., et al., appellants v. United Contractors Association, Inc. of Pittsburgh, Pennsylvania, a corporation, and Associated Trades and Crafts Union, appellees. 483 F.2d 384, 3rd Cir. 1973.

Two issues are presented. Do the charges made by the appellants constitute unfair labor practices subject to the primary jurisdiction of the National Labor Relations Board or alternatively are the defendants entitled to the immunity of labor organizations from the antitrust laws?

The District Court in Pennsylvania held that its jurisdiction to entertain the action was not preempted by the primary jurisdiction of the National Labor Relations Board and it proceeded to determine whether the activities of the association and the Trades and Craft Union were immune from antitrust attack. The district judge said:

"Notwithstanding the bold conclusion that competition in the construction industry of Western Pennsylvania is adversely affected by the instant collective bargaining agreement (competition in which the plaintiffs, in any event, have no justiciable interest), the plaintiffs in this case allege no facts which would even remotely taint the immunity provided the defendant Associated Trades from the antitrust laws. By § 6 of the Clayton Act, the existence of Associated Trades is expressly insulated from the anti-trust laws. * * *" 331 F.Supp. 1298, 1301.

We consider first whether the defendants in the case before us are entitled to this immunity.

At the threshold we are met with the distinction in the relationship between the defendants in this case and the usual relationship between unions and employer organizations where they deal at arm's length with each other. Here, membership in the...