Carpenters Local Union No. 1846 of United Broth. of Carpenters and Joiners of America, AFL-CIO v. Pratt-Farnsworth, Inc.
| Decision Date | 04 November 1982 |
| Docket Number | No. 81-3222,PRATT-FARNSWORT,AFL-CIO,INC,81-3222 |
| Parties | 111 L.R.R.M. (BNA) 2787, 112 L.R.R.M. (BNA) 2525, 95 Lab.Cas. P 13,877, 1982-83 Trade Cases 65,021, 3 Employee Benefits Ca 2273 CARPENTERS LOCAL UNION NO. 1846 OF the UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA,, et al., Plaintiffs-Appellants, v.; Halmar, Inc.; Associated General Contractors of Louisiana, Inc., At-Large District; and Associated General Contractors of Louisiana, Inc., New Orleans District, Defendants-Appellees. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Jerry L. Gardner, Jr., Marie Healey, New Orleans, La., for plaintiffs-appellants.
Frederick A. Kullman, Michael S. Mitchell, Frederick S. Kullman, New Orleans, La., for defendants-appellees.
James Burton, H. Bruce Shreves, New Orleans, La., for Pratt-Farnsworth and Halmar, Inc.
Appeal from the United States District Court for the Eastern District of Louisiana.
Before WISDOM, RANDALL and TATE, Circuit Judges.
This appeal essentially involves an all-out assault by two unions and other related parties on the so-called "double breasted" 1 system of conducting business utilized by contractor employers in the construction business in the New Orleans area. Hotly contested causes of action are alleged under several legal theories, primarily pursuant to the federal labor and antitrust laws; the district court dismissed all claims against the many defendants involved in this action. As explained more fully infra, we affirm the dismissal of certain claims, reverse the dismissal of others, and remand to the district court for further proceedings and development of a more complete factual record.
This lawsuit was brought by Carpenters Local Union No. 1846 and Piledrivers Local Union No. 2436 of the United Brotherhood of Carpenters and Joiners of America, AFL-CIO (hereinafter "Unions"), both unincorporated labor organizations engaged in representing construction employees within the jurisdiction of the United States District Court for the Eastern District of Louisiana. Also party plaintiffs in the suit are three employee benefit funds established on the basis of various collective bargaining agreements between the Unions and signatory employers in the construction industry: the Carpenters District Council of New Orleans and Vicinity Pension Trust, the Carpenters District Council of New Orleans and Vicinity Health and Welfare Plan, and the Carpenters District Council of New Orleans and Vicinity Apprenticeship, Educational and Training Program (hereinafter "Funds"). Additionally, the suit was brought as a class action on behalf of proposed classes of all members of and all persons seeking employment through the Unions and all participants and beneficiaries of the named Funds. No class has at present been certified by the district court.
Four defendants were named: Pratt-Farnsworth, Inc. ("Farnsworth"); Halmar, Inc. ("Halmar"); Associated General Contractors of Louisiana, Inc., New Orleans District ("AGC-New Orleans"); and Associated General Contractors of Louisiana, Inc., At Large District ("AGC-At Large"). The Associated General Contractors, Inc., is a trade organization consisting of various construction companies throughout Louisiana. It is divided administratively into several geographic districts. AGC-New Orleans is one of those districts. AGC-At Large is not limited to any geographical area. Farnsworth is a construction company in the New Orleans area and a member of AGC-New Orleans. Halmar is also a construction company in New Orleans and a member of AGC-At Large.
One of AGC-New Orleans' activities is the negotiation, on behalf of certain of its members, of collective bargaining agreements with local trade unions. AGC-New Orleans is not itself a signatory to these bargaining agreements; rather, the agreements are signed only by the member and non-member contractors who wish to be bound. In the instant case, AGC-New Orleans negotiated a collective bargaining agreement between a multiemployer bargaining unit and the Unions covering the period from May 1, 1977 to April 30, 1980. This agreement constitutes the controverted subject matter of this suit.
Defendant Farnsworth affiliated itself with the AGC organizations, and authorized AGC-New Orleans to bargain on its behalf with the Unions over wages, terms, and conditions of employment. Farnsworth is a signatory to the collective bargaining agreement negotiated by AGC-New Orleans and the Unions. AGC-New Orleans, AGC-At Large, and Halmar are not signatories to the collective bargaining agreement.
In their complaint, plaintiffs have alleged causes of action under three different sets of federal statutes, namely, (1) section 301(a) of the Labor Management Relations Act, 29 U.S.C. § 185(a) (hereinafter "LMRA"); (2) the Employee Retirement Income Security Act, 29 U.S.C. §§ 1001-1461 (hereinafter "ERISA"); and (3) the Sherman and Clayton Antitrust Acts, 15 U.S.C. §§ 1-7, 12-27.
Multiple allegations were made by the plaintiffs under each of these statutory causes of action. First, the plaintiffs alleged violations of the antitrust laws. The gravamen of their antitrust complaint is that the four defendants have conspired to restrain competition in the contractor services market in the New Orleans area by carving out an enclave of non-union carpentry work, access to which is denied union contractors in the industry. They contend that the effect of this alleged conspiracy is to nullify the multiemployer bargaining agreement between the Unions and the signatory contractors, and to coerce third parties in the construction industry to hire non-union contractors and subcontractors.
The plaintiffs' claims under section 301 of the LMRA echo their antitrust allegations. They allege that a "double breasted" operation exists between defendants Farnsworth and Halmar and is being used to channel construction work into Halmar, the non-union part of the operation, while operations of Farnsworth are being phased out slowly to the point of nonexistence. The plaintiffs argue that Farnsworth and Halmar should be treated as a single employer or as alter egos with the result that Halmar would be bound by the collective bargaining agreement that Farnsworth executed with the Unions.
The ERISA cause of action is likewise interrelated with the section 301 labor action. The plaintiffs argue that Farnsworth and Halmar have breached the collective bargaining agreement by failing to submit fringe benefit contributions on behalf of their employees to the Funds as required by the agreement.
Defendants moved for dismissal for failure to state a claim and in the alternative for dismissal for lack of subject matter jurisdiction and for summary judgment. Affidavits were attached to these motions. 2 Plaintiffs thereafter filed a set of interrogatories addressed to the defendants. 3
Before the defendants had filed any answers to the plaintiffs' interrogatories, the district court granted the defendants' motions to dismiss. Carpenters Local Union No. 1846 v. Pratt-Farnsworth, Inc., 511 F.Supp. 509 (E.D.La.1981). The district court held that AGC-New Orleans and AGC-At Large were not proper defendants to the section 301 labor claims and the ERISA claims because they had never signed the collective bargaining agreement with the Unions. Id. at 511-12, 514-15. The court dismissed the section 301 and ERISA claims against Farnsworth on the ground that the plaintiffs had never alleged any breach of the collective bargaining agreement on the part of Farnsworth in regard to its own employees. Id. at 512-15.
As to Halmar, the court dismissed the section 301 and ERISA claims on the basis that it had no authority to determine that Farnsworth and Halmar were a single employer or alter egos without also determining the appropriate bargaining unit of their employees, which, it held, would be an impermissible invasion of the jurisdiction of the National Labor Relations Board (hereinafter "NLRB" or "the Board"). Id. at 512-13. Additionally, the court held that dismissal of the section 301 and ERISA claims as to all defendants was required because of the plaintiffs' failure to exhaust the contractual grievance procedures provided in the collective bargaining agreement. Id. at 513-15.
Finally, the district court dismissed the antitrust allegations because it decided that the bargaining agreement fell within certain nonstatutory exemptions to the antitrust laws, and that the plaintiffs' causes of action were in reality labor law issues parading as antitrust claims. Id. at 512-22. The plaintiffs have appealed to this court, contesting the district court's dismissal on all claims as to all defendants.
Our task now is to determine whether the district court acted properly in dismissing the plaintiffs' claims. Except with respect to the question of exhaustion of contractual grievance procedures, we treat the district court's actions as dismissals under Rule 12(b)(6). 4 In our review of those claims dismissed under Rule 12(b)(6), we may not go outside the pleadings; we must accept all well pleaded facts as true and view them in the light most favorable to the plaintiffs. Dike v. School Board, 650 F.2d 783, 784 (5th Cir. 1981); Brett v. First Federal Savings & Loan Association, 461 F.2d 1155 (5th Cir. 1972). We cannot sustain the district court's dismissal for failure to state a claim "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-102, 2 L.Ed.2d 80 (1957). The district court did go beyond the pleadings in addressing the question of exhaustion of contractual grievance proceedings, and thus we will review its dismissal on that ground as a grant of summary judgment. Our review in...
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